Which formula is used to calculate first year attrition rate?

The first year attrition rate specifically measures the proportion of new employees who leave the organization within their first year. The formula to ascertain this rate focuses on the ratio of employees who remained with the organization compared to the total number of employees at the start of the period.

Using the formula of (Total # of employees who stayed / Total # of employees at start) x 100 allows organizations to evaluate the retention of new hires over their first year of employment. By showing how many of the initial cohort remain, this formula effectively captures the essence of attrition during that critical period when new employees are still integrating into the company culture and operational workflows.

The other formulas do not directly target the specific measure of first year attrition. For instance, calculating total new hires against total employees does not provide insight into who stayed or left within the first year. Similarly, measuring the general turnover against total employees does not distinguish between new versus existing employees. Therefore, the chosen formula offers the most precise portrayal of first year attrition.