That figure assumes it costs an employer 50% of a person’s salary to replace them, which is a conservative figure, DairyNZ people and business product manager Cam Camilleri says.
Other estimates put the cost at up to three times a person’s salary.
“Fifty percent of a person’s salary is even more conservative than the DairyNZ PeopleSmart calculator, and that’s conservative,” Camilleri said.
A key objective in the dairy industry’s Strategy for Sustainable Dairy Farming 2013-2020 was focused on reducing staff turnover, he said.
The Department of Labour’s Linked Employer-Employee Data (LEED) database states staff turnover in dairy during 2000 to 2010 was 40% to 70% above national average.
It’s currently in line with seasonal industries such as hospitality.
“We want to reduce that high turnover to track the national average, which will increase productivity and profit onfarm.”
A high percentage of staff turnover was at the farm assistant level, with the majority of people in the industry for less than one year, he said.
The 2013 Federated Farmers remuneration report showed 49% of farm assistants had a tenure of less than one year, 16% stayed for one year and 15% for two years.
The industry needed to nurture these new people to give them a better first experience onfarm, he said.
Good communication, regular staff meetings, adequate orientation practices were all ways that would improve an employee’s experience, he said.
More emphasis to offer formal and informal training to staff was also vital because it would ultimately increase skills across the industry and increase productivity, he said.
DairyNZ People Survey
As part of DairyNZ’s commitment under the industry strategy, 500 farmers across New Zealand were surveyed to measure current onfarm people management practices and any effect on turnover rates.
A key outcome of the survey was that the large majority of farmers now rate staff as the most important attribute to the business consistently rating them above pasture, cows and infrastructure, Camilleri said.
One in 10 farmers actively disliked staff management, but the remaining nine were evenly split between those who loved it and those who tolerated it, he said.
These were mostly positive messages that indicated farmers were more aware of how important good staff management impacted their business, he said.
“I think the message is getting across and people are a priority for farmers. The line has been drawn between profitability and people.”
The reasons for staff turnover could either be negative, positive or neutral, he said.
Negative turnover involved a bad working experience while a positive turnover reason involved an employee leaving for a new challenge or opportunity.
DairyNZ aimed to reduce negative turnover through encouraging better onfarm practices and communication and delivering tools to support employers and employees, he said.
It’s working with other industry groups to create an industry standard role definition that will break down the key onfarm roles and list the expectations and responsibilities for each role.
The definitions would also list the formal and informal opportunities for training staff to meet those expectations, he said.
The hope was that it would easily demonstrate to employers and employees what was expected in certain roles and where the training opportunities were, he said.
Federated Farmers would use it to base their remuneration benchmarks next year, he said.
Another DairyNZ people tool that would be available within the next two years was the Roster Builder, he said.
The online tool is being designed to offer an easy roster system for farm employers to use, which also caters for legal obligations.
The DairyNZ PeopleSmart website, which will be updated this month, offers a range of tools and resources for people management, he said.
For more information and resources on managing people and staff recruitment visit www.peoplesmart.co.nz.
Key Points
3300 people left the dairy industry in 2013
Staff turnover cost farmers $80m in 2013
Dairy industry staff turnover is 40-70% above national average
49% of farm assistants are in the industry for less than a year
