The Characteristics of Job Turnover in the Bend-Redmond Metro Area

by Kale Donnelly

May 7, 2018

In today’s tight labor market where qualified workers are hard to come by and more vacancies are becoming difficult to fill, hearing an employee say “I’m leaving” is far from music to an employer’s ears. The cost of recruitment and training a new employee can be high, and the institutional knowledge of an exiting employee can be extremely challenging to replace. So, which industries typically shoulder more of the burden when it comes to the “churn” in the labor market? How has turnover behaved in other years? Let’s take a look.

Turning Over a New Leaf

Change is a concept that many of us have grown to expect, but can also find hard to accept when we’re presented with it. With respect to changing employers or even career fields, a certain amount of job-hopping is to be expected throughout one’s lifetime. If you look back on your first 10 jobs, how does that list look? I imagine that the first job is wildly different from the last. Personally, I transitioned from various positions in retail to landscaping, to shoveling driveways in the harsh Wyoming winters, delivering flowers (still in the harsh Wyoming winters), working in a call center, originating home loans, and then finally finding my niche as an analyst for the State of Oregon. In fact, in the 11 years I’ve been in the workforce I’ve held 14 different jobs. While I may be casting myself as a typical Millennial, my previous job-hopping behavior (which I like to happily refer to as “eclectic skills acquisition”) falls in line with the data on turnover rates by age.
Within the Bend-Redmond metro area the highest turnover rate in 2016 was for the youngest cohort of 14 to 18 year olds at 31 percent – more than three times the annual rate of turnover for those aged 35 to 44. As we work our way up the age of working cohorts the trend line for turnover skews downward – maxing out at the youngest working cohort and bottoming out for those with a few more years under their belt. The exception with the trend lies with those retiring at or after the age of 65, thus increasing their rate of turnover.

If we think intuitively we can imagine that more turnover occurs when economic conditions are favorable for an employee. They may be looking to potentially change jobs to increase their earnings, move to another area or state, or are maybe just looking to try something new. The numbers just so happen to support this notion. Our current economic conditions make the option of trying something new within the workplace much more feasible than during tough economic times. As options open up and employers are keen for labor, the mobility of workers and job seekers is significantly higher than they were in 2010 during the depths of the recession.

Difficulty Retaining Workers Varies by Firm Age and Sector

The age of the firm also comes in to play, as those who have just recently taken down their grand opening signs (zero to 1 years of operation) have more than twice the rate of turnover of firms whose operations have been running for more than 11 years – 24 and 11 percent, respectively. However, this isn’t entirely out of the ordinary since a decent share of startups find themselves unsuccessful in their first years of business, resulting in layoffs.

Competition for customers is always a factor, and larger, more established firms can typically operate on thinner margins for a longer period of time than smaller and newer firms in the same area. A handful of turnovers in smaller firms can throw a wrench into the plans of the business and have potentially devastating effects for the employer.

As for turnover by sector, arts, entertainment, and recreation experienced the highest rate of turnover for the Bend-Redmond MSA in 2016 with an annual rate of nearly 28 percent. Given the seasonality of this sector, it’s not so surprising to see that high of a figure. Utilities, on the other hand, reported the least amount of turnover at 3 percent. The demographic makeup of these industries can explain the difference and further drive the point of “turnover by age” home – nearly one out of five workers in the arts, entertainment, and recreation sector is under the age of 25, while less than 2 percent of the manufacturing sector’s workforce is under 25. Therefore, the turnover behavior of these vastly different industries can be explained by their demographic makeup.

Keep Your Job Candidates Close and Your Employees Closer

In the end, employers of all types experience an inescapable element of turnover throughout their ranks. Many different factors from training to benefits to company culture and more can shape the ways in which a firm’s turnover behaves. Since Central Oregon’s 2017 Annual Job Vacancy Survey results show that 64 percent of reported vacancies are difficult to fill, focused plans of recruitment and especially retention are critical in the tight labor market we are currently witnessing.

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