Average Tenure of Employees

Human Resources

There is a lot of variation of turnover lengths between companies, industries and data sources. A 16 year old working in fast food is unlikely to have an average tenure more than a few months while someone in their 50s in a skilled field is likely to be well settled into a long career and not have any plans for moving.  The Employee Tenure Summary from the Department of Labor shows that the median is 4.7 years, with 3.2 years for Millennials (those born after 1980). The median age of older workers 55 to 64 was quite a bit longer at 10.4 years but this does not necessarily signal a changing generation but more the fact that as we age we finally settle down into a location and a career. This data is based on 60,000 household surveys so our data analysis is about half the size of the Department of Labor.

We analyzed 27,008 Linkedin job histories and found that the median turnover period was only 28 months (2.3 years) throughout their total career until the present. We also found that the median continuing tenure for people who are holding a job right now is 51 months. Linkedin users as a whole tend to trend middle aged as shown by the chart below.

PewResearch

 

By using Linkedin the data skews towards more skilled/higher-paid employees who would tend to avoid industries with high turnover rates. One thing to consider is that the data takes into account nearly an entire job history, since Linkedin generally contains all or most of someones historical positions, sometimes all the way back to their first job after college. Even so the median turnover rate of 24 months seems lower than otherwise expected. Nearly 25% of adults use Linkedin so it can easily serve as a great tool for evaluating the job market as a whole. We also know that the tech industry is experiencing very high levels of turnover, with PayScale finding some titans of tech barely able to hold onto employees for 1 year and an average of 3.68. The average itself is not that bad given that these organizations tend to trend younger. It’s worth pointing out that many of these companies are wildly successful and innovative. The service industry, retailing and hospitality industries have all been traditional low tenures as well. What may be most surprising about the tech industry is that the pay, work freedom and benefits are all really good and yet this alone does not seem sufficient to stop employees from moving above the average rate for their age group. For instance PayScale estimates Google’s average tenure at only 1.1 years, when the norm for all industries would be 3.2 years for that median age. This despite the fact that Google offers all the tangible perks that many could only dream of.

 

The current voluntary turnover rate is nearly 11% per year with a 4.7 year median average length of tenure that has been going up over the years despite the perception that it has in fact been going down. Generally the ’80s represented a low in tenure with the present now reaching the highs of 1963. The perception that either people aren’t sticking around anymore or that Millennials are jumping around jobs more than usual has no basis in the figures, which seem to in fact show a general improvement across the board.

MedianTenureThe age discrimination act forbids discrimination against people who are 40 or older but the labor data makes a good case that if you want a lower turnover hiring workers in their 40s and 50s is good business. That’s the case with many manufacturing jobs which tend to feature older workers. The median tenure of someone in their early 20s is barely a year, while someone in their mid 50s may work 10 years or more. Having employees who leave within just 1-2 years can be costly depending on the industry and position. Technical, skilled and management jobs are extremely expensive to replace and it can destabilize an organization to have someone leave. On the flipside the PayScale reports clearly show that some of these poor performing tenure companies are actually very successful. It’s still reasonable to assume though that if they could keep their employees engaged and enthusiastic they could realize even greater returns.

Department of Labor

 

 

 

 

 

 

 

 

 

Here’s a list of companies with some of the shortest tenures.

 

ShortTenure

 

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