The Cost of Turnover
Putting a Price on the Learning Curve by Timothy R. Hinkin and J.BruceTracey
Employee turnover does more than reduce service quality and damage employee moraleit hits a hotels pocketbook.
mployee turnover has long been a concern of the hospitality industry, and therefore of researchers who examine industry human-resources concerns. One stream of research that arose in the past 20 years was an effort to quantify the cost of employee turnover. Although most managers agreed that turnover was bothersome, calculating a dollar figure for employee departures would provide those Timothy R. Hinkin, Ph.D., is a professorof managementorganization, human resources, and law (MOHRL) and director for undergraduate studies at the Cornell University School of Hotel Administration «firstname.lastname@example.org», where J. Bruce Tracey, Ph.D., is an associate professor of MOHRL «email@example.com».
© 2000, Cornell University
managers with information to help them make better human-resources decisions. One of the earliest comprehensive efforts to quantify turnover was published in 1983, when William Wasmuth and Stanley Davis published in the Cornell Hotel and Restaurant Administration Quarterly the results of a three-year study of voluntary employee turnover.1 The subjects of the study were from five departments in each of 20 hotels located in North America and
1 William J. Wasmuth and Stanley W. Davis, Managing Employee Turnover, Cornell Hotel and Restaurant Administration Quarterly, Vol. 24, No. 1 (February 1983), pp. 1522; William J. Wasmuth and Stanley W. Davis, Managing Employee Turnover: Why Employees Leave, Cornell Hotel and Restaurant Administration Quarterly, Vol. 24, No. 2 (May 1993), pp. 1118; and William J. Wasmuth and Stanley W. Davis, Strategies for Managing Employee Turnover, Cornell Hotel and Restaurant Administration Quarterly, Vol. 24, No. 3 (August 1983), pp. 6575.
C R E LOTELANDRESTAURANTADMINISTRATIONQUARTERLY O N LH