The Hidden Costs of Caregiver Turnover – And What You Can Do About Them

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Did you know, a home care agency with 25 caregivers can expect to lose more than $50,000 from their bottom line to caregiver turnover costs this year?

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Did you know, a home care agency with 25 caregivers can expect to lose more than $50,000 from their bottom line to caregiver turnover costs this year?

We asked Home Care Expert, Connor Kunz from Home Care Pulse to take a closer look at the obvious – and not so obvious – costs of caregiver turnover.

Here’s what he told us:

This concerning statistic is based on data from the Center for American Progress as well as results from the 2019 Home Care Benchmarking Study. It’s also corroborated by several studies from researchers at Berkeley and PHI National (some other studies place the number even higher).

Why so high? Let’s break this number down.

The costs of turnover can be categorized into two groups: direct costs and indirect costs. Direct costs are predictable; they include costs like the following:

  • Inability to staff cases (over 60% of agencies report having been unable to staff a case in the last 90 days due to lack of caregivers)
  • Creating job postings
  • Time spent by management to interview new candidates
  • Onboarding costs
  • Training expenses (including time spent by supervisors, management, or caregiver mentors)

While these costs are formidable, they don’t include the considerable indirect costs associated with replacing a caregiver.

Indirect Costs of Turnover

Indirect costs of caregiver turnover are harder to predict and harder still to quantify, but they underscore the fact that caregiver turnover impacts every part of your business. These include:

  • Loss of productivity – newer employees require more time and attention from coordinators and managers, often in addition to their scheduled training time. This time distracts your supervisors from other crucial work they need to be doing.
  • Lowered work quality – more experienced caregivers know the ins and outs of making clients happy. Newer caregivers typically require time and training before they can consistently deliver the quality of care that your clients expect. This could lead to lowered demand for your services and fewer client referrals.
  • Damaged morale/burnout – when too many employees leave, other employees start to ask why. The resulting drop in morale impacts work culture, causes problems for management, and even impacts the level of care that your clients receive.
  • Office staff turnover – a lack of stability in your care team makes work more stressful for your office staff and can contribute to a lack of feeling of stability in their work. Employees who lack a feeling of stability are far more likely to seek employment elsewhere.

What Can You Do?

While these costs add up quickly, there’s a lot you can do to reduce your turnover. We’ve seen agencies reduce their turnover by more than 30% and save thousands of dollars per year by adjusting their policies, changing their culture, and zeroing in the factors that matter most to their caregivers.

In other words, there’s no silver bullet to reducing caregiver turnover, but there are a lot of individual levers you can pull to influence it. These include:

  • Consistent hours. Wherever possible, provide consistent hours that work with your caregivers’ schedules. According to research in the 2019 Benchmarking Study, a lack of consistent hours was caregivers’ top complaint in 2019 – even edging out pay.
  • Competitive pay. No discussion about recruitment/retention is complete without addressing the enormous importance of paying competitively. Check out this tool from myCNAjobs to help you evaluate whether you’re paying competitively for your area.
  • Training. Good training brings a plethora of benefits; not only does it equip your caregivers to provide better care to clients and help to differentiate your agency in marketing efforts, but it also sets you apart as an employer. Providing continuing education to your caregivers is an investment that demonstrates that you’re prioritizing their success.
  • Recognition and appreciation. Everybody likes to feel appreciated. Instituting a recognition program can be a very cost-effective and powerful way to provide a culture that helps caregivers stick with your agency.
  • Actively seek feedback from your caregivers. No two agencies are alike, and your caregivers’ needs may be different from those at another agency. Implement processes to regularly seek feedback from your caregivers (especially anonymously) so that you can zero in on the factors most important to your caregivers.

A Rising Tide Raises All Boats

There’s a saying you might have heard before: A rising tide raises all boats. Your agency is comprised of many different boats€”caregiver recruitment, client experience, marketing, caregiver training, office staff, etc. Raising your caregivers’ satisfaction does not impact just your caregiver turnover boat or just your caregiver recruitment boat; it’s a rising tide that raises the quality and performance of every part of your business.

All of the factors we’ve listed above contribute to this rising tide; however, it’s important to note that of them, training is one of the most impactful as far as affecting the most areas of your business. Good training helps caregivers feel more fulfilled in their work, clients feel happier with the care they’re getting, and office staff feel more relaxed because there are fewer problems in the field.


Want to learn more about implementing training in your agency?

Reach out to a Caregiver Training Advisor today to find out how easy it is to “raise the tide” with Caregiver Training.


Curious how much turnover is costing your agency?

Get a free tool to estimate your costs here.

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