1 in 8 new hires leaving during probation: report

Why is turnover rate of new hires so high?

1 in 8 new hires leaving during probation: report

One in eight employees in Australia are resigning during probation period, according to a new report, which revealed the onboarding challenges for employers amid rising costs of hiring across the country.

Findings from ELMO's 2024 HR Industry Benchmark Report revealed that 13% of new hires in Australia are leaving while still on probation.

New hires are also now taking at least 35 days before becoming fully productive in their roles — much longer than the 24 days in 2023, according to the report.

Joseph Lyons, ELMO CEO, said the figures are "eye-opening" for HR leaders and the C-suite.

"At a time when productivity is front of mind for most businesses, it's worth asking whether your talent processes are as efficient as they could be," he said in a statement.

Source: ELMO

New hire turnover reasons

New hire turnover rate is an "important metric to watch" for HR leaders, who should try to understand why new recruits are leaving so soon.

"Did the job fail to live up to the expectations promised during the recruitment period? Or did a poor onboarding process impact their first impressions?" the report read.

A previous report, also from ELMO, revealed that the top reason why they're leaving is because the job or organisation did not match their expectations during recruitment.

Others cited poor impression of the organisation and their managers.

"Meeting expectations and creating a positive first impression are vital for retaining new talent and businesses only have a small window of opportunity in which to do this," Lyons said.

"The better an organisation understands the success of their onboarding programmes, the better position they will be in to retain new talent and minimise the impact on overall productivity and ultimately the bottom line."

Costs of recruitment

The significant amount of new hires leaving comes as the cost of hiring reaches an average of $20,000 in Australia. For entry-level staff, the cost of recruitment is around $14,000, rising to $25,000 for executives.

Source: ELMO

This metric is important when employers consider that 13% of new hires are leaving within probation, according to the report.

"Given the cost of hiring and the time it takes for recruits to get up to speed, it's essential for HR leaders to know how successful their hiring and retention efforts really are," Lyons said.

"Otherwise, they could be wasting time and money, hindering productivity in the process."

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