Dear All,
I believe there should be three types of attrition calculation methods:
1) Monthly Attrition: To understand the status of a specific month
= (separations in the month) / (opening of the month + closing of the month) / 2
2) Year-to-Date Attrition: To know the YTD status
= similarly as above, but the period has to be specific. For example, if we consider the period from April 09 to December 09, then the opening balance should be for April 09 and the closing balance should be for December 09.
3) Annual Attrition: This will help us monitor the attrition trend and take timely measures. It serves as a forecasting tool.
= (total number of separations) / (average of opening balances) / number of months considered for calculation * 12
For instance, if we want to analyze the attrition trend in the year 2009 and it's April 09, the calculation will be as follows:
Jan 09: Opening - 120, Left - 5
Feb 09: Opening - 115, Left - 7
Mar 09: Opening - 121, Left - 6
Apr 09: Opening - 123, Left - 3
Then our annual attrition will be = (5 + 7 + 6 + 3) / (average of (120 + 115 + 121 + 123)) / 4 * 12
This calculation will indicate our year-end status if the trend of losing people continues in the last 4 months.
I hope this explanation is helpful to all of us.
Bye