The Dire Problem Plaguing the Tech Industry: Retention
The tech industry is currently facing a major challenge – retention. Recent data from the Bureau of Labor Statistics shows that the tech industry has a high turnover rate of nearly 60 percent. This issue affects not only smaller startups but also big players like Google, Uber, and Dropbox. However, high turnover rates come with a cost. Each employee turnover costs the employer approximately 33 percent of that employee’s salary. The cost of replacing an employee can be as high as nine months of their salary.
Additionally, there is also the time and cost associated with finding a replacement. On average, the cost per hire is around $4,700. This means that hiring for a job that pays $60,000 can cost $180,000 or more.
Retention, timing, and training of new hires are costly realities for all businesses. In highly competitive fields like software development, this becomes not just a cost problem but also a competitive one. The ability to compete depends on the ability to deliver new software features.
