Advantages of Turnover
Retaining employees is a common objective of human resources professionals and company leaders. Over time, relatively low employee turnover is costly and can decrease overall competency as well as morale of the workforce. Some level of employee turnover actually can have some business advantages.
Losing poor performing employees with no shot of improvement is generally positive for an organization, as it can improve employee morale. Someone not carrying his weight in a work team can create tension and frustration in other employees. Companies that retain weak performers or toxic personalities often end up losing better employees who get tired of picking up the slack.
Turnover also offers the potential for an upgrade at a given position. If a senior employee who has lost energy and enthusiasm retires, you have the chance to bring in someone with passion for the job. Additionally, a worker who lacks knowledge and ability to perform the job well can clear the way for a talent upgrade. Sometimes, companies make bad hires and put forth greater effort in avoiding the same mistake by focusing on desirable attributes for a replacement.
Companies with zero or low levels of turnover can get into a groupthink rut where new ideas are rarely presented. Bringing in new employees periodically allows for fresh perspectives and ideas. A new employee may see a problem from a different vantage point or have a better ability to think outside of the box on a product or service solution. In a work team, he may help employees consider alternatives. Turnover also may lead to a more diverse workforce with varying gender, ethnicity and age makeups.
In some organizations, employee turnover may reduce salary levels at certain positions -- as when pay relates to experience or seniority as opposed to just the position. In education, for instance, veteran teachers high on the pay scale often receive early retirement package offers, and replacements start at lower annual salaries. Similar pay structures exist in some private companies as well.