Reading time: 4 minutes
Employee turnover in IT services companies isn’t just an HR issue. When a consultant leaves, it sets off a chain reaction: their projects are reassigned, their colleagues become overburdened, productivity drops, and costs pile up—far beyond the cost of simply hiring a replacement.
According to Numem, the turnover rate in the digital sector is around 18%. At this level, each digital services company statistically loses nearly one in five consultants each year. The consequences of this instability are numerous and often underestimated.
Here are the 7 concrete impacts of high employee turnover—and why it’s crucial to take action before they pile up. To understand the causes of this turnover, check out our article: The 12 Reasons for Employee Turnover in IT Services Companies.
Here are 7 consequences of high turnover in IT services company:
1. Work overload
When a consultant leaves the company, ongoing projects are distributed among former colleagues who are still with the company. This can quickly lead to overwork and further resignations.
2. Increased stress
A vicious circle can quickly emerge, creating stress: an employee resigns, bringing with him or her a work overload which in turn creates more stress.
At this stage, relations between managers and consultants continue to be strained, which can increase employee dissatisfaction.
3. Decline in team motivation
One of our employees’ main motivations is the quality of their relationships with colleagues. So if an employee leaves the company, this can have an impact on team morale. All the more so if the person was well-liked. What’s more, it could also prompt other consultants to resign.
4. Difficulty in tracking projects
When a consultant leaves the company, it’s time to take over his or her current projects. It’s a process that can take time, especially if the project is well underway. So we need to identify the various customers for whom the initial consultant will be working, and identify a consultant who is available to put him or her on the project.
In such situations, managers have to juggle schedules and skills within the company.
5. Direct financial losses
The departure of an employee represents a direct and immediate financial loss. According to an industry estimate, each departure is equivalent to approximately 63 days’ pay in lost productivity, and this figure does not include ancillary costs.
Added to this is an often-overlooked factor: the substitute teacher’s gap between contracts. According to Syntec data, gaps between contracts cost, on average, between €8,000 and €15,000 per consultant per year. Every failed hire or every new consultant who doesn’t integrate well adds to this cost. To learn how to manage this factor, check out our article on Managing the period between contracts at an IT services company.
6. Slowdown in productivity
The transition between the departure of an employee and the arrival of a new one leads to a slowdown in productivity. This loss of productivity corresponds to the time it takes for the newcomer to become operational.
7. High replacement costs
Hiring a new consultant involves much more than just posting a job ad and conducting an interview. You need to factor in:
- sourcing costs (job boards, recruitment agencies, recruiters’ time),
- training and onboarding costs (several weeks before full autonomy),
- indirect costs associated with the loss of skills and client knowledge resulting from the departing consultant.
In digital services companies, where human capital is the primary asset, the total cost of hiring often exceeds 6 to 9 months’ salary of the open position, according to industry estimates. An 18% turnover rate therefore means that this cycle repeats itself for nearly one in five consultants each year.
In conclusion
These seven consequences form a vicious cycle : a departure creates an overload, the overload generates stress, stress undermines motivation, and diminished motivation drives other consultants toward the exit.
The good news is that this cycle isn’t inevitable. Most of these consequences can be mitigated—or even prevented—by addressing the root causes of employee turnover early on and implementing a genuine retention strategy.
For more information:
→ Understanding the 12 Causes of Employee Turnover in IT Services Companies
