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Cited by 4Labor market dynamics and wage inequalityHuman Resource and Talent ManagementJob Satisfaction and Organizational Behavior

How Costly is Turnover? Evidence from Retail

Open access
Kuhn, Peter, Yu, Lizi·2019·National Bureau of Economic Research
DOI 10.3386/w26179
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Abstract

We estimate turnover costs in small retail sales teams using daily sales data and an advance notice requirement to address endogeneity concerns.In addition to short-staffing and onboarding costs, we identify two less familiar sources of turnover costs: incumbent workers' recruitment activities, and reductions in team morale after a departure is announced.Our estimates of total turnover costs are relatively modest, however: Ten percent higher turnover is about as costly as a 0.6% wage increase.We attribute these low costs to a set of complementary personnel policies which ensure that only 25 percent of departures result in a short-staffing spell.

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  • Interviews are costly because they divert high-skill current employees from other productive tasks.

    “These interviews are moreover costly because they divert high-skill current employees from other productive tasks (Kuhn and Yu, 2019).”

    From Hiring as Exploration (2020) · cites this paper as Kuhn and Yu, 2019

    The Introduction reports productivity costs when incumbent employees devote time and attention to filling a vacancy. The “More on Hiring at Firm A” section says a regional manager spends about 12 hours per hire on a process that includes a short interview. The paper does not identify interviewers as high-skill employees or isolate interviews, rather than recruiting more broadly, as the source of the productivity loss. (LLM, conf=0.83)

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Authors
Kuhn, P., & Yu, L.
Affiliations
National Bureau of Economic Research (US)
ORCID
Venue
National Bureau of Economic Research
Publisher
National Bureau of Economic Research
Published
2019-08
DOI
10.3386/w26179
OpenAlex
W3125675350
Cited by
4
References
2
Citations by year
2026: 1 · 2022: 1 · 2020: 2
Type
report
Language
en
Open access
Locations
National Bureau of Economic Research (publishedVersion)
Topics
  • Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Labor market dynamics and wage inequality
  • Social Sciences › Business, Management and Accounting › Organizational Behavior and Human Resource Management › Human Resource and Talent Management
  • Social Sciences › Business, Management and Accounting › Organizational Behavior and Human Resource Management › Job Satisfaction and Organizational Behavior
Keywords
employee turnover, turnover costs, short staffing, recruitment costs, team morale, personnel policy

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