Human resource data
• is quantifiable information that can be used to measure workforce performance. This will
help inform decision making e.g. is corrective action needed, should bonuses be paid, are
staff motivated? Human resource data includes:
• Labour turnover and retention rates
• Labour productivity
• Employee costs as a percentage of turnover
• Labour cost per unit
Labour turnover
• Labour turnover is the rate of change in a firm’s labour force Calculated as:
Labour turnover Rate = Number of staff leaving x 100
Average number of staff
Example: A car firm has 1 000 full time employees in 1 year. Of these, 50 employees leave the
company What is the labour turnover for the company? 50 x 100 = 5%
1 000
What are the disadvantages of high labour turnover? Any advantages to having high labour turnover/ low staff
retention?
• Higher costs due to recruitment and time taken for induction New staff may bring new ideas and experience gained
training elsewhere, improving business performance
• Business may not be able to met customer needs until the May allow new staff with higher skills to be recruited
member of staff is replaced New staff bring change which creates a more dynamic
• Loss of experience and skills may lead to lower output and environment and avoids existing staff becoming
quality complacent
, In year 1 Lenovell had 100 workers who produced 10 000 laptops. In order to
Labour turnover
try and increase productivity and reduce costs they adopted a piece rate system
of working (staff paid per unit they produce). By the end of the year they found 20
workers had left. In year 2, with 80 workers, they produced 9 000 laptops.
1. What is the labour turnover in year 1 and year 2?
2. Make a list of four factors that might lead to high labour turnover in a business.
3. Choose two of these factors and explain what you think that a firm could do to reduce
labour turnover in these circumstances.
• is quantifiable information that can be used to measure workforce performance. This will
help inform decision making e.g. is corrective action needed, should bonuses be paid, are
staff motivated? Human resource data includes:
• Labour turnover and retention rates
• Labour productivity
• Employee costs as a percentage of turnover
• Labour cost per unit
Labour turnover
• Labour turnover is the rate of change in a firm’s labour force Calculated as:
Labour turnover Rate = Number of staff leaving x 100
Average number of staff
Example: A car firm has 1 000 full time employees in 1 year. Of these, 50 employees leave the
company What is the labour turnover for the company? 50 x 100 = 5%
1 000
What are the disadvantages of high labour turnover? Any advantages to having high labour turnover/ low staff
retention?
• Higher costs due to recruitment and time taken for induction New staff may bring new ideas and experience gained
training elsewhere, improving business performance
• Business may not be able to met customer needs until the May allow new staff with higher skills to be recruited
member of staff is replaced New staff bring change which creates a more dynamic
• Loss of experience and skills may lead to lower output and environment and avoids existing staff becoming
quality complacent
, In year 1 Lenovell had 100 workers who produced 10 000 laptops. In order to
Labour turnover
try and increase productivity and reduce costs they adopted a piece rate system
of working (staff paid per unit they produce). By the end of the year they found 20
workers had left. In year 2, with 80 workers, they produced 9 000 laptops.
1. What is the labour turnover in year 1 and year 2?
2. Make a list of four factors that might lead to high labour turnover in a business.
3. Choose two of these factors and explain what you think that a firm could do to reduce
labour turnover in these circumstances.
