Professional in Human Resources (PHR) Practice Exam

How is turnover typically calculated in an organization?

1. By total revenue generated

2. By number of job offers made

3. By number of separations and total workforce employees

4. By employee satisfaction surveys

The correct answer is: By number of separations and total workforce employees

Turnover is typically calculated by analyzing the number of separations from the organization relative to the total number of employees within the workforce during a specific period. This method gives a clear picture of how many employees have left the organization and allows for the computation of a turnover rate. To calculate turnover, organizations often use the formula: **Turnover Rate = (Number of Separations / Average Number of Employees) x 100** This calculation helps HR professionals understand the level of employee retention and turnover within the organization. A high turnover rate could signal issues such as poor job satisfaction, inadequate management, or lack of career advancement opportunities. Monitoring this metric is crucial for strategic workforce planning and improving employee retention strategies. In contrast, revenue generation, job offers made, and employee satisfaction surveys do not provide a direct measurement of turnover. While they may offer valuable insights into organizational performance and employee engagement, they do not reflect the actual separations and workforce dynamics necessary for calculating turnover accurately.