Effect of employees´ turnover rate on industrial firms´ production efficiency: A conceptual model

As a widespread phenomenon in modern industrial firms, turnover is exerting much stronger effect. Aiming at some studies and many practitioners think that the employees´ turnover rate influences industrial firm production efficiency negatively, the paper makes investigation on the relationship between the production efficiency of industrial firm and the turnover rate of employees by a conceptual model. The model shows that the relationship between the two is somewhat like an inversed U-shaped curve, which indicates that when the turnover rate is lower than a certain level of the turning point, there is positive relationship between them, otherwise turnover rate has the negative effect on production efficiency of industrial firm. For industrial firm managers, the employees´ turnover rate should be controlled within a certain range in order to improve industrial firm production efficiency; on the contrary, with the increase of employees´ turnover, industrial firm production efficiency will collapse.