Organizations are concerned about employees leaving them because employee turnover is expensive. A 2012 article by the Centre for American Progress has identified that the average cost of replacing an employee is 21% of their annual salary. This is estimated based on the cost of recruiting a new employee, his/her training, and the time it takes to bring him/her up to speed. In addition, the organization loses valuable knowledge that the employee had acquired during his/her tenure, the value of which is not estimable easily.
In this project, I analyzed the causal effect of working overtime on attrition for a sample of IBM employees. And analyzed changes in the propensity of attrition for employees working overtime with various personal characteristics like marital status, gender and job level. The results of my analysis are summarized below:
- I observed that working overtime increases the propensity of an employee to attrite by 19.7%
- Single employees have a higher propensity of attrition when worked overtime
- Stock options are an effective strategy to check employee attrition for employees working overtime
- Mid-level employees have the lowest propensity to attrite when worked overtime