Turnover comes down when managers talk with people about their future, when people can see a path to grow, and when pay and respect hold up next to the job down the street. More than half of people who quit say their manager or company could have done something to keep them, and 51% say no one asked about their job or their future in the three months before they left (workplace research, 2019). So the fix is mostly in how your managers lead, not in perks.
How high is normal turnover for a small company?
In August 2026, private employers with 10 to 49 employees lost 2.5% of their people to quits in a single month, and 3.9% to all separations (BLS job openings and turnover, establishment size, August 2026, preliminary). Companies with 50 to 249 employees were close behind, at 2.3% quits and 3.9% total. Across all employers, 3.1 million people quit in August (BLS, August 2026, preliminary).
A monthly rate looks small. If 2.5% a month holds all year, that is roughly 26 to 30% of your headcount walking out by choice in twelve months.
Why do people actually quit?
In a national survey of people who quit a job, the top reasons were (national survey of workers who quit, 2022):
| Reason given for quitting | Share who said it was a reason |
|---|---|
| Pay was too low | 63% |
| No opportunities for advancement | 63% |
| Felt disrespected at work | 57% |
| Child care issues (people with a child under 18) | 48% |
| No flexibility to choose when to work | 45% |
| Benefits were not good | 43% |
Two of the top three are about how people are led and whether they can grow. Those are the two you control most at 15 to 150 people.
What does each exit cost you?
Replacing one employee can cost one half to two times that person's annual salary, and that is a conservative estimate (workplace research, 2019). At a $60,000 salary, one exit can cost $30,000 to $120,000 once you count recruiting, ramp time, lost work and the people who cover the gap.
The costs that never hit a spreadsheet matter too. One small-business owner wrote in a public forum: "The staff at this location are extremely loyal to him and so my concern is that the shock of this will cause me to lose other skilled valuable employees." One bad exit can start a second and a third.
What actually brings turnover down?
These are the moves we start with, in this order:
- Find out where people are leaving. Pull every exit from the last 12 months. Sort by manager, role, tenure and reason. Turnover is rarely even; it usually clusters under one or two managers or in the first 90 days.
- Coach the managers in the hot spots. Give each one a short monthly one-on-one with every direct report that covers how the work is going and where the person wants to go next. Train them to handle hard conversations early instead of saving them for review time.
- Make the path to grow visible. Write down what it takes to move up in each role, even if the ladder has only two or three steps. People leave when they cannot see a next step.
- Check pay against the market once a year. Low pay is a top reason people quit. You do not have to lead the market, but you need to know where you stand for each role.
- Fix the first 90 days. A clear first week, a named go-to person and a 30, 60 and 90 day check-in catch the early exits.
- Ask people who stay. A short stay conversation each year tells you what would make someone leave before they do.
Is it the manager or the company?
Often the manager. If exits cluster under one person, start there. If they are spread across the company, look at pay, growth paths and how new people are onboarded. Owners in public forums describe it this way: "He's much more direct and controlling than my leadership style, and several employees have started coming to me saying morale is dropping." That is a coaching problem, and it is fixable.
Who wrote this?
Deven Downey, our founder, has built HR from zero several times. Before DMD, in an in-house role at a 500-employee organization with high attrition, our team cut turnover 40 percent through supervisor coaching and promotion pathways.
Where do these numbers come from?
- Quits and separations by company size, August 2026: BLS Job Openings and Labor Turnover, Table 7
- National quits, August 2026: BLS Job Openings and Labor Turnover summary
- Why people quit: national survey of workers who quit, 2022
- Replacement cost and preventable exits: workplace research on voluntary turnover, 2019