Category: HR KPIs.

There are many ways you can determine an employee’s satisfaction with their job. You might ask them to rate their engagement with the work, look at their attendance record, or even study how their output has increased or decreased over time.

However, the simplest, and perhaps most telling, way to determine an employee’s satisfaction is simply by looking at their tenure with a company. It’s common sense that if an employee is generally satisfied with their company, they’ll remain there for a long period of time. Similarly, if they’re dissatisfied, they might switch their job as quickly as they can.

Average Tenure Length

There are many types of employees in the workforce. While it may be tempting to label someone a “job-hopper” or a “loyal employee” just based on how long they’ve stayed in a certain job, it’s important to note the statistics surrounding an employee’s tenure in a position.

Interestingly, the median length of tenure for employees actually varies depending on what age demographic you’re looking at, as well as the field of occupation. Here are a few figures:

  • The average tenure for employees aged between 24 and 34 is 3.2 years.
  • The average tenure for employees aged 65 and more is 10.3 years.
  • The average tenure for workers in the professional, management, and other related occupations is 5.5 years.
  • The average tenure for a worker in a service job is 3 years.

While it might sound smart to stay loyal to just one or two companies over the course of a career, people in the 24-34 age demographic could actually develop a broader skill base if they make more frequent switches– either between positions within a company or between companies as a whole.

While staying at a job for a long period of time could indicate an employee’s loyalty and satisfaction, it could also give the impression that they don’t have a strong interest in growing their career. Many people choose to leave their jobs if they do not receive a promotion within three to five years. In some cases, it happens even sooner.

How to determine a company’s average tenure

Just as it’s important to look at the average length of tenure for employees, it is also helpful to look at a company’s average tenure per employee, which averages all of the employee’s tenures with the total number of employees. This can estimate the turnover rate for a company, as well as give some indication as to the average employee’s job satisfaction. As we’ve already established: you can surmise that a happier employee will remain at their job for a longer period of time.

You can calculate the average tenure per employee by adding up the amount of time all workers have been employed at a company, and divide it by the total number of employees in the company. The formula would look like this:

Average Tenure
Total Employment Time for All EmployeesTotal Number of Employees

This can be used to measure the average tenure for employees in a single department, or in an entire company. From this result, you could surmise the loyalty of employees at a company as well as the level of satisfaction these employees had in their positions. A long average tenure is usually a positive sign for a company, and something that can attract more employees– and, consequently, more profit.

Profit.co’s OKR software provides an intuitive interface to define your OKRs and comes with 300+ predefined KPIs to make OKR adoption easy.

Related Articles