Research Handbook on Employee Turnover

Research Handbook on Employee Turnover

New Horizons in Management series

Edited by George Saridakis and Cary L. Cooper

Covering the period of the financial crisis, this Research Handbook discusses the degree of importance of different driving forces on employee turnover. The discussions contribute to policy agendas on productivity, firm performance and economic growth. The contributors provide a selection of theoretical and empirical research papers that deal with aspects of employee turnover, as well as its effects on workers and firms within the current socio-economic environment. It draws on theories and evidence from economics, management, social sciences and other related disciplines.

Chapter 12: A diagnostic methodology for discovering the reasons for employee turnover using shocks and events

Justin Purl, Kathleen E. Hall and Rodger W. Griffeth

Subjects: business and management, human resource management, organisational behaviour


. . . provides for the first time a set of tools for diagnosing existing jobs – and a map for translating the diagnostic results into specific action steps for change. (Hackman et al., 1975, on job enrichment) Employee turnover has been an organizational resource drain for over 100 years. Fisher (1916) reported that the Ford Motor Company reduced turnover from 400 percent to 23 percent in one year (between 1913 and 1914). The secret was ‘nine months of profit-sharing’ (Fisher, 1916: 144). Fisher (1916) estimated that $2 040 000 was saved, which is equivalent to $47 676 228 today. Over a half-century later, Mirvis and Lawler (1977) estimated that a substantial increase in satisfaction could potentially save a bank $125 160 in a year for 160 employees or approximately $482 686 after adjusting for inflation. After almost another decade, McEvoy and Cascio (1985) reviewed ‘Strategies for reducing employee turnover’, citing two strategies – realistic job previews and job enrichment – with enough evidence to analyze the effect across studies. The researchers estimated that from approximately $10 200 to $120 200 per year, for every 100 employees in an organization, could be saved through use of these methods combined (McEvoy and Cascio, 1985). Today, that would save approximately $22 154 to $261 074. More recently, the conversation has turned to costs alone. Kacmar et al. (2006) cite the retraining costs of the US fast-food industry at $4.3 billion per year.

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