Retention Rate

What is retention rate?

Employee retention rate is the percentage of employees who stay with an organisation over a given period. It is a core people metric that reflects how well an organisation keeps its people, and it is the mirror image of turnover: high retention means low turnover, and vice versa.

It is closely tied to employee engagement and is often used as an outcome measure when assessing coaching ROI.

Why retention rate matters

Losing people is expensive, in recruitment, onboarding, lost knowledge, and disruption, so retention has a direct financial impact. It also signals the health of the culture and management: people rarely leave good managers and growth. Watching retention, especially of key and high-performing talent, is essential for any People function. `[ADD CITED STAT on cost of turnover]

How to calculate it

The basic formula over a period is:

Retention rate (%) = (number of employees who stayed for the whole period ÷ number of employees at the start of the period) × 100.

It is worth tracking retention for key segments, such as high performers or a critical function, not just the overall number, since an average can hide a problem in an important group.

Keep your best people

People stay when they feel supported and see a future. Coachello improves two of the biggest drivers of retention, manager quality and growth, and lets you measure the impact on retention itself.

Improve retention where it starts. Book a demo.

FAQs

What is the difference between retention and turnover?

They are two sides of the same coin. Retention is the percentage who stay; turnover is the percentage who leave. High retention means low turnover.

How do you calculate retention rate?

Divide the number of employees who stayed for the whole period by the number at the start, then multiply by 100.

What improves retention?

Good managers, growth and development opportunities, fair reward, wellbeing, and a sense of purpose. Coaching supports several of these directly.