The Canadian Grocery HR Council commissioned a review of the best academic literature on HR practices in retail to provide the industry with proven techniques to improve performance. This is a one of a series of best practices. The following is a summary of turnover issues from classic HR literature.

ISSUES

• Turnover decreases store performance, as measured by profit margin and customer service.
• Valued employees are in increasingly shorter supply and will be increasingly harder to replace as the economy rebounds.
• Turnover rates vary significantly across job category. Turnover is lowest for full-time management and highest, by far, for part-time, non-management.
• Employee turnover has a more negative effect at low process-conformance stores where HR operations are less streamlined, less standardized, and less disciplined. This leads to scenarios in which management does not have a “back-up plan” for when employees leave, and thus organizational knowledge is lost.

FACTORS AFFECTING AN EMPLOYEE’S DECISION TO LEAVE

• Perception of job security.
• Compensation levels – perceived fairness.
• Benefits.
• Demographic variables such as age and gender – young people about to enter university tend not to return.
• Perceptions of organizational culture.
• Local economic and labor market conditions.
• Employees who are dissatisfied with inadequate training and on-boarding are more inclined to leave.

References

Arnold, Hugh J.; Feldman, Daniel C.. 1982. A multivariate analysis of the determinants of job turnover. Journal of Applied Psychology, Vol 67(3)

Arie, C.; Glebeek, Erik., K.; Is high employee turnover really harmful? An Empirical test using company records, The Academy of Management Journal, Vol 47, April 2004

Baysinger, B. D. & Mobley, W. H. Employee turnover: Individual and organizational analysis. In K. M. Rowland & G. R. Ferris (Eds.), Research in personnel and human resources management (Vol. 1). JAI Press, 1983, 269-319.

Huselid, Mark A. “The Impact of Human Resource Management Practices on Turnover, Productivity, and Corporate Financial Performance.” The Academy of Management Journal 38.3 (June 1995): 635-672

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