Page 21 - MetalForming October 2012

one senior executive in the metalforming industry indicat- ed, achieving best-in-class performance should not be a company’s sole objective.
“Balance is extremely important,” he said. “You want to retain your key people and strong performers, but you also want to have new people coming into the organization that can provide a fresh perspective and ideas for improvement.”
A Deeper Look at the Data
Looking at subsets of the companies that participated in the Benchmarking Report, the data showed little variation. Companies that identified themselves as automotive sup- pliers had an average employee turnover ratio of 15 percent, while nonautomotive companies reported an average ratio
of 13 percent. Companies that indicated they had a unionized workforce had a slightly lower than average turnover ratio of 12 percent. However, there was one exception: the one that looked at employee turnover ratio by size of company, based on annual sales (Fig. 4).
Companies participating in the 2011 survey with sales less than $5 million had an average employee turnover ratio of only 5 percent—significantly below the industry average of 15 percent. Companies with sales from $5 to $50 million expe- rienced an average employee turnover of 16 percent. Final- ly, the largest companies in the survey, those with annual sales exceeding $50 million, outperformed the average with an employee turnover ratio of 10 percent.
Flexibility Is the Key
It will be interesting to see what this ratio does in 2012. The consensus is that, like most things, it’s tied to the overall con- dition of the economy within manufacturing. Those that believe the economic outlook is positive see the employee turnover rate increasing on the basis that people have more confidence in looking for new and better jobs. On the other hand, those who feel the economy might be softening expect the employee turnover rate to remain stable.
Said another senior-level executive in the industry: “The only constant in this business is change—it’s fluid, and you
Fig. 4
have to adjust as you go.”
MF
Best Practices
Employee Turnover Ratio for 2011 Company Size by Sales
Sales more than $50 million
Sales from $5 to $50 million
Sales less than $5 million
10%
16%
5%
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