In the example above, assuming the number of employees at the start of January was 95, another approach to calculating the average number of employees during the period is 95 + 89 / 2 = 92. In this case, the attrition for the period calculates as 26 / 92 * 100 = 28.2 percent, and the annualized attrition as 78 / 92 * 100 = 84.8 percent.
Many employers calculate both the number of employees and the total employee count differently, and this further distorts annualized attrition rates greatly. For instance, many employers include only voluntary resignations in the number of employees leaving, and do not include employee separation owing to operations constraints, such as retrenchments owing to a branch closing, or terminations owing to performance issues.
Some employers calculate new hire attrition by dividing the total number of employees who quit within one year of joining divided by the total number of new hires in a year to calculate fresher attrition, to determine whether new hire stay with the company or whether underlying issues induce a high turnover.
In short, an annualized attrition calculation is not set in stone, and depends largely on the method and figures adopted.