Early onboarding turnover:
how to retain new employees

Early turnover during onboarding is a serious problem that many companies face. When new employees leave the company shortly after being hired, this not only affects productivity, but also causes high costs and internal tensions. Effective integration of new employees is therefore crucial for the long-term success of a company.

In this article, we look at what early turnover means, what is meant by early turnover, why it is so important for companies and how targeted measures can improve the retention of new employees.

What is early turnover?

Early turnover describes the termination of new employees within a short period after they are hired. Usually, this termination occurs during the probationary period or even before the first day of work. This type of employee turnover is particularly problematic as it often indicates fundamental problems in the recruitment and onboarding process.

The exact definition of early turnover varies, but typically includes the period from contract signing to the end of the probationary period. Many employees leave before their first day of work or within the first few weeks to months at the company. The reasons for this can be false expectations of the position, a lack of integration into the team or insufficient introduction to the corporate culture.

The frequency of early turnover is alarming: according to the Haufe Onboarding Study 2021, 36% of new employees quit before their first day at work, and a further 15% considered quitting on their first day. These figures highlight the need to implement effective onboarding processes in order to optimally support new employees from the outset and promote their long-term loyalty to the company.

Why is early fluctuation a problem?

If new employees leave the company shortly after being hired, this not only results in high costs, but also causes problems in the team and in work processes.

The problem can be broken down into the following points:

  • Cost-intensive: Recruiting and training new employees involves considerable costs. In the event of early turnover, these investments are lost and have to be re-invested.
  • Loss of productivity: If employees leave the company early, there are interruptions and a drop in productivity as remaining team members have to take on additional tasks.
  • Negative impact on company culture: High early turnover can affect the morale and commitment of existing employees as it increases instability and uncertainty in their working environment.
  • Company reputation: A company with high early turnover can gain a bad reputation in the industry, making it difficult to attract new talent.

These problems highlight the need to optimize the onboarding process and ensure that new employees are well-integrated from the outset and supported by meaningful onboarding measures. Effective measures to reduce early turnover help to increase employee loyalty, strengthen the corporate culture, and ensure long-term success.

How to calculate your early turnover rate

You can use a simple formula to calculate the percentage of employees who leave the company shortly after being hired. All you need is the number of new hires who have left and the total number of new hires. It is important that both figures are from a specific period (e.g. a quarter or a financial year) so that the calculation is meaningful.

If your company has hired 20 new employees within 3 months and at the end of the probationary period 14 of these employees are still working for the company because 7 left early, then the calculation is 7/20*100= 35 %

This means that more than a third of the new employees have left the company within the probationary period or even before their first day at work. This clearly indicates that the causes of this early turnover should be urgently investigated.

Reasons for early turnover

Early turnover can be triggered by a variety of factors rooted in the hiring process as well as onboarding and company culture. The most common reasons are:

1. Misunderstandings in the recruitment process

  • Misleading job advertisements: Incorrect or exaggerated information in the job advertisement can create false expectations in the applicant.
  • Unclear communication: Misunderstandings during the interview or unclear information about the role and expectations often lead to disappointment.

2. Inadequate onboarding

  • Unstructured process: A missing or poorly organized onboarding process can leave new employees feeling inadequately prepared and supported.
  • Lack of integration: If new employees are well integrated into the team, they often feel safe and welcome.

3. Problems with the corporate culture

  • Inappropriate cultural fit: If the values and norms of the company do not match those of the new employee, this can lead to tension and dissatisfaction.
  • Lack of appreciation: New employees who do not feel valued or recognized tend to leave the company again quickly.

Companies can take targeted measures to reduce early turnover and ensure long-term employee retention by analyzing these factors in detail.

Costs of early fluctuation

Early fluctuation is not only an organizational problem, but also leads to considerable costs that are often underestimated. These costs can be divided into direct and indirect costs.

Direct costs due to early terminations

  • Recruitment costs: Searching for new employees often requires costly job advertisements, time and resources for interviews, and the selection process. According to the Haufe Onboarding Study 2021, these costs can quickly amount to several thousand euros per hire.
  • Onboarding costs are very time-consuming, especially if these processes have to be repeated. This phase can take several weeks to months, during which time the new employee’s productivity and output are still very low, especially at the beginning.
  • Contract costs: Early turnover often incurs costs for termination interviews, exit interviews, and possibly severance payments. According to the Haufe Onboarding Study 2021, the direct costs of termination, including administrative expenses and possible severance payments, can amount to up to a quarter of the employee’s annual salary.

Indirect costs due to early onboarding fluctuation

  • Loss of productivity: The remaining employees must take on additional tasks, which can lead to overload and inefficient work. When a team member needs to be replaced, this can contribute to a drop in productivity of up to 40%.
  • Loss of motivation: High early turnover can lower the morale and engagement of remaining employees. According to the Gallup Engagement Index, the motivation and commitment of remaining employees can drop by up to 30% if colleagues leave the company early.
  • Damage to reputation: A poor reputation due to high turnover can deter potential applicants, increasing recruitment costs.

By recognizing and specifically eliminating the causes of early turnover, companies can not only strengthen the loyalty of new employees, but also significantly reduce the associated costs.

Effective strategies to reduce early fluctuation

If you are reading this article, you are probably familiar with the weaknesses of your onboarding process. Is your onboarding currently leading to many early departures in your company? If so, you’ll find proven tips in the following section to optimize your recruiting and strengthen employee retention.

1. Optimized recruitment process

A transparent and realistic recruitment process is the first step towards avoiding early turnover:

  • Honest communication: Job advertisements and interviews should clearly describe the tasks, expectations, and corporate culture. According to the Haufe Onboarding Study 2021, false expectations led to premature dismissal for 56% of new employees.
  • Check cultural fit: Make sure that applicants fit into the company professionally and culturally. This can be supported by specific questions in the interview and trial days.

2. Structured preboarding

Prepare new employees optimally before their first day at work:

  • Welcome pack: To make new employees feel welcome, send a welcome pack with important information, login details, and small gifts.
  • Communication: Keep in regular contact to give new employees the feeling that they are part of the team even before they start.

3. Comprehensive onboarding program

Structured and comprehensive onboarding is crucial for the integration of new employees, which is why the following elements can be useful:

  • Induction plan: Create an effective induction plan for new employees that covers the first few days and weeks. This should include both technical training and social integration measures.
  • Mentor/buddy system: Assign each new employee a mentor or buddy who serves as a point of contact and provides support during the induction process. A buddy system makes it much easier to integrate new employees.
  • Regular check-ins: Schedule regular feedback meetings to review progress and identify and resolve any problems at an early stage.

4. Integration into the corporate culture

Social and cultural integration is just as important as professional training.

  • Team events: Organize team events and informal meetings to allow new employees to get to know their colleagues in a relaxed atmosphere.
  • Cultural introductions: Explain the company’s values, policies, and vision and show new employees how they can get involved actively. Eighty percent of employees feel more connected to the company when they see themselves as part of the team.

5. Continuous support and development

Provide ongoing support for new employees and offer development opportunities.

  • Ongoing training: Provide regular training and development opportunities to enhance employees’ skills and give them a sense of progression.
  • Career planning: Discuss possible career paths and development prospects within the company at an early stage. This strengthens loyalty and shows new employees they can be part of the company long-term.

6. Use of digital onboarding tools

Digital tools make the induction process more efficient and quickly provide new employees with all the relevant information.

  • Onboarding software: Implement onboarding software that bundles all important information and tasks centrally. This makes it easier to maintain an overview and ensures a uniform induction process.
  • Digital knowledge databases: Use digital platforms to provide training materials and important documents. This gives new employees access to relevant information at all times.

By implementing these measures and using suitable tools, companies can significantly reduce early turnover and at the same time strengthen the satisfaction and loyalty of new employees in the long term. A well-thought-out and well-structured onboarding program is therefore crucial for a successful start and long-term cooperation.

Our great2know platform makes it easier for you to seamlessly integrate new employees into all areas of the company. Whether it’s general onboarding, position-related knowledge transfer or our digital corporate memory – we offer you the tools to effectively support your team and give every new employee the best possible start.

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Early onboarding fluctuation: our conclusion

Early turnover during onboarding is a severe problem that can cost companies dearly. It reduces productivity, causes high costs, and creates internal tensions. Therefore, targeted optimization of the onboarding process is essential.

By implementing transparent recruitment processes, structured pre-boarding measures and comprehensive onboarding programs, companies can significantly reduce early turnover. Particular attention should be paid to cultural and social integration as well as the continuous support and development of new employees. Invest in your new employees and lay a strong foundation for the future success of your company.

about the author
Lenita Behncke
Lenita writes articles for great2know as a content creator on topics such as knowledge transfer & knowledge management.