The Cost of Homecare Personal Support Worker Turnover

Introduction

Global healthcare systems have an increasing reliance on homecare to meet the needs of ageing populations. ¹ Health workforce stability is required to create a basis for the growth that is needed to scale homecare capacity to meet this rising demand. Currently, the homecare sector faces some of the lowest retention rates in healthcare. ² Frequent employee turnover reduces the availability and consistency of homecare providers, increases system costs to provide care, and introduces inefficiencies for healthcare employers. The impacts of turnover are uneven, with variations by occupation and sector. In particular, Personal Support Workers (PSWs) in homecare have some of the highest turnover rates (44-65%),^3,4 exceeding those observed for hospital-based nurses (15-44%) ⁵ and physicians (5-7%). ⁶ Homecare PSWs have a higher likelihood of leaving their jobs compared to those working in the hospital and long-term care home sectors,^7,8 with commonly-reported reasons including low wages, stressful workloads, precarious employment, and high rates of injury.^9-12 With heightened demand for homecare services to support ageing in place, efforts to reduce turnover to achieve workforce scale and stability are needed to meet health system requirements.

Turnover imposes avoidable and often-hidden costs which are incurred to replace staff. In a not-for-profit organization, this results in a reduction of available funds for reinvestment in direct care, education, and other improvements. Managing the impacts of employee turnover also affects the productivity of the whole organization, reducing the potential for growth in the care workforce and limiting access to care. Beyond the impact on individual care provider organizations, this is a vital societal-level concern when healthcare systems consistently struggle to meet demands for care, in large part due to a scarcity of healthcare providers. In homecare, where infrastructure demands are limited, the availability of skilled healthcare providers is the key barrier to growing healthcare system capacity and alleviating pressures on the broader healthcare system. As retention interventions typically include a monetary cost, benchmarking the cost of turnover can inform data-driven resource allocation decisions for workforce stability.

The costs of turnover are difficult to quantify because they are spread across a range of organizational departments and activities. While cost of turnover estimates for homecare PSWs are lacking in the current literature, estimates are available for nursing. In the United States, average hospital nurse turnover costs are often reported at 0.75-3.0 times an employee’s salary ¹³ and one Canadian study found the average cost of turnover per nurse to be $25,000 (CAD in 2001). ¹⁴ While these estimates do provide a healthcare-based reference point, the multitude of distinctions between hospital nurses and homecare PSWs necessitate differences in the calculation of turnover costs for employers. ¹⁵ Estimates of nursing turnover costs in institutional environments have commonly been based on the Nursing Turnover Cost Calculation Methodology (NTCCM). ¹³ This has recently been updated and adapted to reflect current human resources tools and practices as well as the pay-per-visit basis upon which most homecare in Canada is provided. The resulting Homecare Cost of Turnover Model (HCTM) ¹⁵ provides a basis for developing a specific cost estimate for homecare PSW turnover.

Objective

The objective of this study was to provide an estimate for the cost of turnover of PSWs in the homecare sector at an employer level, guided by the HCTM. ¹⁵

Methods

The HCTM was applied to estimate the cost of homecare PSW turnover from an employer perspective. This model identifies turnover-related costs experienced by homecare employers operating under pay-per-visit models in both the pre- and post-hire phases.

Key Metrics and Definitions

Turnover Rate

PSW turnover was calculated in alignment with the ISO 30414 standard (2025) ¹⁶ as:

T u r n o v e r r a t e = N u m b e r o f t e r m i n a t e d P S W s A v e r a g e n u m b e r o f P S W s e m p l o y e d i n t h e p e r i o d × 100

In this equation, the number of terminated PSWs captures all PSW departures for any reason (voluntary or involuntary).

Turnover Costs

The costs related to PSW turnover were estimated for each category in the HCTM described by Zagrodney et al. ¹⁵ Further descriptions of each category are provided in Table 1. Costs reported in each category are adjusted to represent the proportion due to PSW turnover, rather than total PSW hiring costs for the organization. Costs for each category were summed to determine the total annual cost of turnover. The percentage contribution of each category to the overall cost of turnover is also provided. The cost of turnover per homecare PSW was then calculated by dividing the total annual cost by the number of PSWs who left employment during the study period.

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Table 1.

Application of Homecare Cost of Turnover Model (HCTM) to PSWs

	Description	Annual cost ($)	% of total cost
Pre-hire		$7,811,000	91%
Unfilled positions		$7,228,000	85%
Short-term opportunity costs	Vacancies create a temporary, short-term reduction in labour supply before a new hire is hired, trained and able to deliver the same amount of care as the worker who previously held the role. During this time, the temporary gap in labour supply can be filled by existing employees through overtime hours paid at a premium. If this is not possible, the organization’s capacity to deliver care decreases, leading to opportunity costs.	$425,000	5%
Long-term opportunity costs	Turnover creates a need to hire for replacement instead of growth, contributing to reduced capacity to meet system demands for homecare. This is experienced at the organizational level as a loss in potential revenue from the rejection of incoming service referrals due to limited capacity, or as sharing revenues with subcontractors to meet demand. Estimates in this category are limited to the proportion of referral rejections which could have been avoided if all hiring created workforce growth rather than replacement.	$6,803,000	80%
Recruitment		$472,000	6%
Events	Event costs include event space, food and beverage expenses, and employer-branded items	$3,000	<1%
Advertising	Advertising costs include ad creation and placement, promotion via social media, and subscriptions for third-party recruitment sites and services	$52,000	1%
Salaries	Salaries for human resources personnel dedicated to recruitment, including time spent on pre-screening and interviewing candidates	$418,000	5%
Hiring		$111,000	1%
Verification	Fees for background and criminal record checks, personnel time and space to organize and conduct physical readiness tests	$67,000	1%
Hiring bonuses	Bonuses paid to current employees for referring successful candidates	$24,000	<1%
New employee processing	Time spent on administrative tasks for onboarding new hires across human resources, finance, and information technology departments	$20,000	<1%
Post-hire		$730,000	8%
Orientation and training		$618,000	7%
Training	Time spent on orientation by new hires and trainers; administrative support for organizing orientations, physical space and virtual resources; additional employee time for precepted client visits	$575,000	7%
Supplies	Costs for employer-supplied uniform and health and safety materials	$43,000	<1%
Delivering care		$90,000	1%
Other employee productivity during “learning” period	Additional time spent supporting new hires by supervisors, scheduling coordinators, and peer coaches/mentors	$90,000	1%
Exit		$22,000	<1%
Employment processing upon exit	Administrative time to formalize the end of employment by the human resources, finance and information technology departments; time spent conducting and analyzing exit interviews/surveys; costs for third-party survey platform and exit survey administration	$15,000	<1%
Loss of supplies & equipment	The organization may incur costs related to the replacement of lost devices not returned/charged to the employee upon termination (e.g., company cell phone)	$7,000	<1%
Employer-level annual total cost		$8,541,000
Cost of turnover per homecare PSW		$22,000

Note. All calculations were based on Canadian dollars in the year 2024. Values are approximations rounded to the nearest thousand and full percentage point.

Results

Details of each cost input are provided in Table 1. The PSW turnover rate at the case organization during the study period (calendar year 2024) was 23%. During the study period, the proportion of new hires who replaced outgoing PSWs rather than contributing to a growth in capacity was 85%. The estimated annual cost of turnover for the study period was $8.6 million or $22,000 per PSW who left employment during that year.

Opportunity costs related to unfilled positions accounted for 85% of the total cost of turnover. The greatest cost contributions were from the loss of growth potential when new hires replace outgoing staff (85% of PSWs hired in 2024), rather than contributing to new growth in a care economy where demand exceeds supply. ¹⁷ There was a smaller but still notable contribution from short-term opportunity costs, which included both overtime paid to existing staff and financial consequences related to a temporary inability to meet existing care obligations. Compared to costs from unfilled positions, other costs of turnover were minor. The second, third, and fourth largest cost drivers were related to orienting and training (7%) and recruiting (6%) new staff.

Discussion

This article presents the first known homecare PSW cost of turnover estimate at $22,000, or approximately 50% of the average Ontario homecare PSW’s annual income. ¹⁸ This cost was calculated at an employer level, based on the Homecare Cost of Turnover Model. ¹⁵ The application of this model using contemporary data provides insights to drive cost-effective and evidence-informed decision-making related to retention strategies. This cost of turnover estimate provides timely information for employers to understand the fiscal consequences of relatively high turnover rates within this occupation. This estimate also provides a valuable reference point for policy-makers working to meet rising demand for in-home PSW services, where access and continuity of care are currently limited by workforce instability and high turnover.^19,20

Valuable insights into impactful areas of focus for reducing turnover costs can be gained by examining the categorical distribution of costs provided by the HCTM. The majority of costs were from the opportunity costs related to unfilled positions (85%), which is slightly higher than but comparable to estimates from the hospital nursing literature (72-78% from Jones ²¹ and 40-83% from Duffield ⁵ ). This homecare-specific estimate reveals that the financial impacts of stabilizing and expanding the workforce to address further demand for care could be substantial and would outweigh many of the costs associated with investments in retention. Comparatively, expected savings from reducing other turnover cost contributors (e.g., streamlining recruitment, training, and offboarding) would be relatively small. Examination of this categorical distribution of costs highlights how investments into relatively low-cost activities which have been demonstrated to improve retention, such as more comprehensive onboarding ²² and improving supervisory support, ²⁰ are likely to be impactful targets for intervention by employers and policy-makers.

When comparing this homecare-based cost of turnover estimate to other sectors, it is important to understand how sector-specific payment models can affect turnover costs. The $22,000 per homecare PSW cost estimate reported here, representing 50% of the average Ontario homecare PSW’s annual income, ¹⁸ is comparatively lower than typically-reported values for hospital-based nurses, which range from 75% to 300% of an employee’s annual income. ¹³ In hospital settings, nurses are typically paid the same regardless of the number of individuals who receive their care, with employers absorbing the costs of reduced productivity (or other staff extending themselves to provide additional support) during the onboarding and offboarding phases of employment. In contrast, the employer does not absorb these types of productivity-related costs in a pay-per-visit system (such as the Ontario homecare system) in which PSWs are paid only for the visits they complete. The cost of homecare PSW turnover presented here should therefore be interpreted within the context of a pay-per-visit model which is already relatively efficient in terms of reducing employer costs.

Beyond the employer-level costs captured in this model, there are much broader societal-level costs and implications to homecare PSW turnover which should be acknowledged. The availability of homecare, of which the substantial majority is provided by PSWs, is vital for access to care and patient flow within the broader healthcare system. Homecare already provides the lowest-cost option to care for an ageing population,^23,24 and current demand for homecare services vastly exceeds supply.^17,25 Given that an estimated 40% of homecare PSWs who leave a job are not just switching employers, but are leaving the occupation or workforce entirely, ⁸ limiting turnover can be expected to grow the overall homecare PSW workforce. This in turn can improve homecare capacity, protect against unnecessary and expensive long-term care home and hospital admission,^23-27 and increase the ability of the healthcare system as a whole to meet population-level care needs. ⁷ Without addressing homecare turnover, reduced homecare capacity contributes to avoidable downstream challenges and costs beyond the community, including heightened strain on the hospital and institutional long-term care sectors. At the individual client level, high turnover disrupts care continuity, reduces care quality, ²⁸ and has been linked to increased adverse events,^29,30 resulting in worsened health outcomes and higher overall costs of care. The high rate of sector-level turnover also creates additional pressures on those who remain as homecare PSWs, with heightened risk of burnout (and exit) as they struggle to meet demands for care. ³¹ This drives further turnover in this already understaffed sector. ²⁵ These broader workforce-level and societal-level implications are of interest to policy-makers responsible for ensuring access to care which can meet the needs of the ageing population. ¹

Across the Organisation for Economic Co-operation and Development (OECD), the majority of countries have implemented policy-level measures to improve retention of direct care workers in homecare, including wage enhancements, stress management programs for workers, and other measures designed to improve working conditions. ¹ Within Canada, investments in homecare PSW retention have been made at both the federal and provincial levels. For example, a federal tax break has been offered to individuals working as PSWs, ³² while at the provincial level this focus is seen though investments into wage enhancements^33-35 and retention bonuses. ³⁶ Future policies aimed at addressing homecare PSW retention would benefit from considering the financial implications of underinvestment into this workforce, including drawing from evidence provided in this article.

As employers and governments work to stabilize and grow the homecare workforce through improved retention, evidence-based estimates of the cost of turnover create visibility into the potential value of investing in retention—such as through initiatives to enhance orientation, strengthen supervisory supports, offer professional growth opportunities, and increase compensation. These estimates emphasize the costs of inaction and supports conversations to move from a focus only on the costs of retention initiatives to more balanced financial decision-making with quantification of the potential benefits of these investments.

Limitations

The calculated costs of turnover were based on a large, urban, Ontario homecare organization operating within a unionized environment. The relatively low turnover rate within this particular organization compared to other reported rates (23% vs. up to 65% in United States homecare^3,4) should be considered when interpreting these. These costs were captured for an organization which primarily provided publicly-funded homecare services, operating within a pay-per-visit model of care (versus salaried or strictly hourly payment structures), which may impact the degree to which these estimates apply in other jurisdictions and employment contexts.

This study concentrated on turnover costs for employers, but there are additional, broader implications of homecare PSW turnover, beyond the level of individual homecare provider organizations. Homecare employee turnover affects workers directly through disrupted income and increased workloads for those remaining, reduces care continuity for individuals receiving care, limits access for those seeking care, and contributes to the cost of healthcare services as individuals are more likely to receive care in more expensive settings.^23-26 Additional cost of turnover modelling at a broader health system level may further support policy-makers in evaluating potential investments in sector-level retention strategies.

Conclusion

This article offers a first known published estimate of homecare PSW turnover costs. In doing so, it provides financial insights for employers and policy-makers as to where the greatest costs of turnover lie—in the financial impacts of restricting the growth of care capacity, not in the direct costs required to recruit, hire, and onboard staff. This aligns with the social impacts, where unmet needs and access to care are of primary concern across the healthcare system. The financial insights offered by applying the homecare cost of turnover model can support decision-makers in assessing the potential benefits of a wide variety of retention strategies.

Visibility into the costs of losing an employee at approximately 50% of PSWs’ salary emphasizes the financial implications of any decision which could impact retention. In the homecare sector, which has persistently experienced high rates of turnover, the presented cost of PSW turnover offers a concrete estimate to compare against when designing and evaluating evidence-informed solutions to improve retention. When decision-making about retention strategies can be based on evidence regarding both the anticipated costs and benefits of interventions, this creates the conditions for fiscally responsible and cost-effective decision-making. Downstream impacts of improved retention can include improved operational efficiency, team stability and care continuity. Policy-makers within homecare provider organizations and governments can leverage evidence on the financial impact of turnover to make targeted investments to strengthen and stabilize the homecare workforce and expand access to care.