Uses and Limitations

Recruitment and resignation rates are measures of labour turnover.

In good times when job openings are plentiful, recruitment and resignation rates tend to be high reflecting movement of workers between jobs. In periods of economic downturn, high layoffs are usually coupled with low resignation and recruitment rates.

The resignation rates by industry are valuable to employers for comparing their staff turnover against the industry norm. Low resignation rate in a company relative to the industry average is usually considered to be an indicator of good labour-management relations. Labour turnover also reflects the unique labour market dynamics of the various industries. For example, accommodation and food services typically have higher turnover rates because of their heavy reliance on temporary and part-time workers to cope with fluctuations in demand.