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HR & Benefits News: The Real Cost Of Worker Turnover For Grocers

Chris Cooley mental health
Chris Cooley

Last updated on December 18th, 2017 at 10:15 am

Editor’s note: HR & Benefits News is a new monthly column by Chris Cooley, co-founder of MyHRConcierge and SMB Benefits Advisors.


Price tag of turnover is shocking

Employee turnover is a significant issue for independent grocers, especially for part-time workers.

And the real cost of turnover is hidden—it’s not a tracked profit-and-loss statement line item. To quantify real turnover costs, let’s start with these findings from the 2017 Independent Grocers Financial Survey:

Average Turnover for Part-Time Employees—48.9 percent

Average Number of Part-Time employees per Store—33


Now, let’s calculate the real cost of turnover for an average grocery store:

Number of part-time workers—33

Number who leave each year—16 (33 x 48.9 percent)

Average cost for grocer to replace each worker making $8 per hour—$4,200 (according to the Coca-Cola Retailing Research Council)

Average annual cost of turnover per store—$67,200


Curb turnover costs

While there is no magic bullet, here are some important considerations as grocers look for ways to solve the complex challenge of turnover:

• Health, dental and vision insurance is the most valued benefit by job seekers, according to  Fractl’s Survey of 2,000 U.S. workers.

• Many part-time employees work fewer than 30 hours per week and are not eligible for a company’s health plan.

• Even if part-time workers are eligible for the group plan, many will not enroll because the plan is not affordable.

• Offering a high-quality telemedicine benefit is one-way grocers can add value for part-time workers. This can help grocers recruit and retain valuable employees.

• While telemedicine is not insurance and does not meet the minimum essential coverage requirements under the Affordable Care Act, it does provide participants access to health care.


How telemedicine can impact turnover

According to a recent Employee Turnover Reduction Study by PSC Technology Inc., 52 percent of hourly workers said they would prefer the medical care benefit described to them instead of a 5 percent raise.

Here’s the medical benefit described to the 1,850 survey participants making an average $9.03 per hour: Unlimited free access to physicians and specialists for yourself and your dependents by phone or video with lab and Rx privileges as well as lab diagnostic support.

It is easy for part-timers to land a job with a comparable wage when benefits aren’t a factor. A high-quality telemedicine benefit helps grocers recruit and keep part-time workers by offering a more attractive option vs. no health coverage or group health plan. Part-timers simply do not want to lose an affordable, convenient telemedicine benefit for themselves and their dependents.


Telemedicine benefits are not created equal

To deliver real value, a telemedicine benefit must meet two criteria:

1.     Provide high-quality service and professional care

2.     Help you manage rising labor costs

Here are some important features to consider when selecting a telemedicine benefit:

High-Quality Service & Professional Care

–Access to a board-certified physician 24- hours a day, 7 days a week

–Available from work, home or anywhere

–For the worker and their dependents

–Using a mobile phone or computer to videoconference

–With no co-pay or deductible

–For a wide variety of ailments (i.e., allergies, flu, sinus infections, etc.)

–Includes medical consultation, diagnosis and prescription, if required

Help Manage Rising Labor Costs

–Includes a program that increases awareness and use of the benefit among workers

–To drive savings in multiple ways (i.e., less expensive ER visits; reduced time away from work for doctor visits and sick time)

Cooley provides HR compliance and administration, workforce management and benefits advisory solutions; his companies specialize in helping small to medium businesses throughout the U.S. He can be reached at 855-538-6947, ext. 108, or at [email protected].

About the author

Lorrie Griffith

Lorrie began covering the supermarket and foodservice industries at Shelby Publishing in 1988, an English major fresh out of the University of Georgia. She began as an editorial assistant/proofreader (and continues to proofread everything, everywhere, in spite of herself). She spent three-plus decades with Shelby in various editorial roles, and after a detour into business development, rejoined Shelby in June 2024. "It's good to be back covering the greatest industry in the world," she says.

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