A term used to describe voluntary and involuntary reduction in the employer’s physical workforce and where the department heads don’t hire substitutes. Employees could be leaving due to retirements, deaths, or termination. Example: a company has 100 active full-time-employees at the beginning of the year. However, on December 31, they only 98. This leaves a deficit of 20 people, resulting in a 2% attrition rate (100-98/100).

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