MADISON, Wis. (8/18/14)--While the turnover rate at credit unions is at historically low levels, replacing a staff member can cost anywhere from 25% to 200% of the employee's annual salary, according to a new white paper from the CUNA HR/TD Council.
According to the "CUNA Turnover and Staffing Report 2013-2014," which summarizes the results of an online survey conducted by the Credit Union National Association between January and April 2013, the overall turnover rate among credit unions with $1 million or more in assets is 12%.
That's not to suggest that turnover at all levels of the average credit union sits at just 12%. The above-mentioned CUNA report found that turnover among management-level credit union staff, for instance, sits at 6%, while turnover in the typical credit union's lending department, which includes loan officers, processors and interviewers, tends to be about 7%.
The difference is made up in the front-line and part-time ranks, which according to CUNA statistics put 2012 turnover among the former group of employees (covering tellers, member service representatives and cashiers) at 18% and the latter group at 20%.
Among the costs associated with turnover are:
- Termination costs: The costs related to severance packages and administrative functions related to the termination;
- Replacement costs: These costs are associated with advertising open positions, interviewing candidates, pre-employment administrative expenses, travel/moving costs and more;
- Vacancy costs: Overtime expenses and temporary staffers are among the components that are included in this area;
- Learning curve costs: Also known as the costs that go along with training new hires as well as their lack of productivity for the first six to 12 months; and
- Intangible costs: These costs cover turnover's impact on staff morale, member service disruption, burnout and absenteeism among remaining employees, and the loss of institutional knowledge.
To download the white paper, use the link.