Combat or Succumb to High Turnover?
March 5, 2017
What is a veterinary manager to do – aggressively combat, or succumb to high turnover rates?
There are many studies which evaluate the cost of turnover. Some calculations range as high as 2x the annual salary of the team member being replaced1, especially when the person is at an executive level (such as a veterinarian).
Another equation, found in the Center for American Progress, may be applicable to the majority of veterinary team members. “For workers earning less than $50,000 annually—which covers three-quarters of all workers in the United States—the 22 case studies show a typical cost of turnover of 20 percent of salary,” as stated in There are Significant Business Costs to Replacing Employees.
You may be aware that veterinary hospitals experience team turnover at twice the rate of other industries2. When managers begin tracking and calculating their team turnover rates, they may find their average annual turnover is upwards of 25-50%! Calculate your annual team turnover.
Let’s put pen to paper to determine just how much it may be costing veterinary hospitals when they gain and lose employees. Keep in mind, there is a financial equation AND an emotional equation. Turnover is simply STRESSFUL!
For our calculations, we will use a veterinary hospital with 3 full-time veterinarians and 12 support staff experiencing a 30% annual turnover rate with an average salary of $50,000. That veterinary hospital’s cost of turnover may conceivably be $40,000 per year (15 x 0.3 = 4 separations x $10,000.00 = $40,000).
Costs associated with team turnover include:
- manager time in hiring (posting, reviewing applications, and interviewing)
- tangible costs in posting and tracking job announcements
- team time in training
- inefficiency of new hires as they adapt into productive team members (it may take 1-2 years to bring a new employee to the level of the exiting, experienced one)
- stressful impact of team being in a state of morphing, especially if it’s over a long period of time
An earlier CATALYST blog identified 4 Tips in Team Retention. To elaborate on one of these tips, consider applying the cost of team turnover ($40,000 from the above example) to developing a team trainer (a team member who enjoys teaching, is organized and invested in the vision of the practice). OR invest in benefits that are tailored to your team’s needs (child-care, gymnasium membership). OR invest in management training and leadership, embracing concepts in human relations, policies and procedures and implementation of tools for success.
Benefits associated with higher team retention include:
- continuity in delivery of services positively impacting client satisfaction
- continuity in delivery of patient care which can result in improved effectiveness and competence of patient care
- efficient teams, positively impacting speed and trust
Retain and grow your veterinary team by aggressively combating veterinary team turnover! Track your retention rate, participate in exit interviews and ask your team what makes them happy in their work.
Yours in Veterinary Team Development,
Rebecca Rose, CVT