How much would the turnover rate have to be reduced

Reference no: EM133407566

Case Study: A financial services company with 100 employees in their Information Technology (IT) department had a high turnover rate within the IT group. A survey of IT employees revealed that the reason most of them left was dissatisfaction with the level of training.

The average turnover rate for this department was 24 percent per year.
The cost to recruit and train one new IT employee was $56,625.
To address the turnover problem, the company developed a skills training program.

The skills training program averaged 80 hours per year, per employee for the 100 employees.
The average IT employee wage was $40 per hour.
Instructor, classroom, and other costs were $160,000.

Questions: In your written assignment, answer all of the following:

What is the total cost of training? The total cost of turnover?
If the turnover rate dropped 8 percent (from 24 percent to 16 percent), what would be the financial benefit of the training program?
What is the ROI of the skills training program with an 8% decrease in turnover?
How much would the turnover rate have to be reduced (from 24 percent) for the training program to show a benefit?

Reference no: EM133407566

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