When someone hands in their notice, most businesses think about recruitment fees and maybe a bit of disruption during the handover. What they don't think about is the £30,614 that each departure is about to cost them.

That's the average figure from Oxford Economics research, and it's probably conservative. For specialist roles, you're looking at £40,000 to £100,000. Yet according to CIPD, only 17% of UK companies actually calculate the true cost of turnover.

Let's break down what you're really paying for when that resignation email lands in your inbox.

The Visible Costs (That Everyone Underestimates)

Recruitment fees typically run 15-20% of the role's salary. For a £40,000 position, that's £6,000-£8,000 before you've even started interviewing.

Advertising costs add another few thousand if you're using multiple job boards and targeted campaigns.

Interview time compounds quickly. If five people spend three hours each interviewing candidates, that's 15 hours of salary cost – plus the opportunity cost of whatever those people didn't do while they were interviewing.

Moonworkers research shows these hard costs represent just 33% of the total turnover expense. The remaining 67%? That's where things get expensive.

The Hidden Costs (That Actually Break the Budget)

Lost productivity during notice period – Let's be honest about what happens during someone's final weeks. They're not operating at full capacity. They're tying up loose ends, documenting processes, and mentally checked out. Research suggests productivity drops by 50% or more during notice periods.

The productivity void – From the day they leave until their replacement reaches full effectiveness, that role is producing at reduced capacity. According to multiple UK sources citing Oxford Economics data, it takes an average of 28 weeks for a new employee to reach full productivity.

Think about that. More than half a year of reduced output.

Culture Amp's 2024 analysis puts this in stark terms: to replace someone earning the UK average salary of £37,400, you're looking at £11,200 to £74,900 in total costs depending on the role's complexity. The range exists because specialist positions have longer learning curves and higher productivity gaps.

The Ripple Effects Nobody Calculates

Team morale and productivity – When someone leaves, it doesn't just affect their output. Their former colleagues absorb extra work, experience disruption to established workflows, and often question their own position. PayFit research notes that these knock-on effects to team performance are rarely quantified but can be substantial.

Institutional knowledge walks out the door with every departure. The person who knew exactly how to handle that tricky client, who understood the workarounds for that temperamental system, who remembered why certain decisions were made – gone. You can't put a precise number on this, but you definitely feel it.

Customer relationships can deteriorate during transitions, particularly in client-facing roles. Even with good handovers, there's an adjustment period where service quality dips.

Cultural disruption intensifies when turnover becomes a pattern. CIPD reports that the UK median turnover rate sits at 15%, but in some sectors it's dramatically higher. When departures feel constant, it affects everyone's sense of stability and engagement.

The ROI of Actually Caring

Here's where the maths gets interesting. If replacing an employee costs £30,000 on average, how much could you afford to invest in keeping them?

The answer is: quite a lot more than most businesses currently spend.

Let's say you invested £3,600 annually per employee in meaningful financial wellbeing support – the kind that consolidates benefits into actual money they can use for real expenses. That's 12% of the average replacement cost. If that investment prevents just one in eight employees from leaving, you've broken even. Anything better than that and you're in profit.

Research from Deloitte (cited across multiple retention studies) shows that customer acquisition costs have risen 50% over five years, while retention remains 5x cheaper. The same logic applies to employees. Prevention is dramatically more cost-effective than replacement.

What "Meaningful Investment" Actually Looks Like

Traditional benefits often miss the mark because they're fragmented, hard to access, or don't address the actual financial pressures employees face. When the Money and Pensions Service reports that 56% of UK employees are in financial difficulty, offering a gym discount doesn't move the needle.

What does work? Direct financial support that employees can use for genuine needs. When you can consolidate employer contributions into £100-300 monthly that goes straight into employees' wallets, you're addressing the root cause of much of the stress that leads to turnover.

The maths is compelling: £3,600 annual investment to reduce £30,614 average replacement costs. That's a 3:1 ROI on retention before you even factor in the productivity gains from having a stable, experienced team.

The Bottom Line

The next time someone resigns, don't just think about posting a job ad. Think about the £30,000+ you're about to spend – and whether you could have prevented it with a fraction of that investment.

Most businesses are accidentally spending huge sums on turnover while underspending on retention. The question isn't whether you can afford to invest more in keeping people. It's whether you can afford not to.