HR Techologies & Systems

Applying Time Series Analysis to Forecast Attrition

Applying Time Series Analysis to Forecast Attrition

Applying Time Series Analysis to Forecast Attrition

Applying Time Series Analysis to Forecast Attrition

Sep 17, 2025

6

min

A line graph showing employee attrition rates over several months with a dotted line projecting future trends, representing a time series forecast.
A line graph showing employee attrition rates over several months with a dotted line projecting future trends, representing a time series forecast.
A line graph showing employee attrition rates over several months with a dotted line projecting future trends, representing a time series forecast.

Can You Predict Which Employees Will Leave Next?

Stop reacting to attrition. Discover how Time Series Analysis transforms your historical HR data into a powerful predictive tool.

Quarterly Employee Attrition Rate (%)
3.5%2.0%
Q1Q2Q3Q4Q1Q2Q3Q4
Historical
Forecast

What is Time Series Analysis?

It's a statistical method for analyzing data points collected over a period of time. In HR, we track metrics like employee departures month-over-month to uncover patterns, understand causes, and forecast future trends.

Think of it as telling the story of your workforce over time, so you can write a better next chapter.

Tracking Departures Over Time
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug

Deconstructing Your Attrition Data

To forecast accurately, we first break down our historical data into four key components. Understanding these helps separate the signal from the noise.

📈 Trend

The long-term direction. Is attrition generally increasing, decreasing, or stable?

☀️ Seasonality

Predictable, repeating patterns. Do more people leave after bonus payouts or during summer?

🔄 Cyclicality

Longer-term patterns tied to economic or business cycles, not a fixed calendar.

⚡ Noise

Random, unpredictable fluctuations. The "static" that can hide the true patterns.

The First Step: Making Data Stable

For a forecast to be reliable, the data's core properties (like its average) must be consistent over time. This is called **stationarity**. Unstable data with a strong trend can mislead a model.

Unstable vs. Stable Attrition Data
Non-Stationary
Stationary

We use techniques like "differencing" to remove the trend, making the underlying patterns easier for a model to learn.

Does the Past Predict the Future?

That's the question **Autocorrelation** answers. It measures how much this month's attrition is related to previous months. This helps us find the "memory" in our data.

Autocorrelation Function (ACF) Plot
Lag (Months)

A strong spike at a specific lag (e.g., 12 months) on an ACF plot suggests a powerful seasonal pattern.

Seeing the Trend with Moving Averages

To clarify the underlying trend, we "smooth" out the random noise using a Moving Average. This technique averages attrition over a specific period (e.g., 3 months) to reveal a clearer path.

Actual vs. 3-Month Moving Average
MA_t = (A_t + A_t-1 + A_t-2) / 3

This calculates the 3-period Moving Average (MA).

Introducing ARIMA

The ARIMA model is the powerhouse of time series forecasting, combining the concepts we've discussed into one robust framework.

AR

Auto-Regressive
Uses past values to predict future values.

+

I

Integrated
Makes data stationary by differencing.

+

MA

Moving Average
Uses past forecast errors to improve predictions.

ARIMA Forecast vs. Historical Data

Connecting Attrition to Business Drivers

Forecasting *when* attrition will happen is powerful. Understanding *why* is transformative. The next step is to correlate attrition trends with other key HR metrics.

Attrition Rate vs. Average Compa-Ratio
HighLow
HighLow

Here, we see a clear inverse pattern: as the average Compa-Ratio (salary vs. midpoint) drops, the attrition rate tends to rise.

From Prediction to Proactive Strategy

An accurate forecast is a call to action. It allows you to move from being reactive to shaping the future of your workforce.

  • 🗓️
    Anticipate High-Risk Periods. If a spike is predicted for Q4, schedule engagement surveys and "stay interviews" for critical talent in Q3.
  • 💰
    Address Root Causes. If attrition is linked to low compa-ratios, proactively review compensation for at-risk employee segments.
  • 👥
    Optimize Resource Planning. If you forecast losing 10 engineers, you can start building a talent pipeline now, ensuring business continuity.

Ready to Make Attrition Predictable?

PeoplePilot's AI-powered analytics platform turns complex data into clear, actionable insights. Build a more resilient workforce by seeing what's next.

#HRAnalytics #EmployeeAttrition #TimeSeries #PredictiveAnalytics #PeopleAnalytics #HRTech #FutureOfWork

time series analysis for attrition, forecast employee turnover, ARIMA model for HR, predictive analytics in HR, employee retention forecasting, people analytics, autocorrelation HR data, seasonal employee turnover, workforce planning analytics, HR data trends, proactive retention strategy, employee attrition patterns, human resources forecasting, Stop reacting to employee turnover and start predicting it with time series analysis for attrition. This powerful people analytics method allows you to analyze your historical departure data to uncover patterns like trends and seasonality, and ultimately forecast future attrition rates. By understanding the core concepts of what time series forecasting is in HR and using robust models like ARIMA, you can anticipate high-risk periods before they happen. While this method forecasts the overall rate, it pairs perfectly with other models like using logistic regression to identify at-risk employees on an individual level. This foresight enables you to build a proactive retention strategy, such as knowing the right time to conduct effective stay interviews and optimize workforce planning.
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Frequently Asked Questions

What's the real difference between Seasonality and Cyclicality? ☀️🔄

What's the real difference between Seasonality and Cyclicality? ☀️🔄

What's the real difference between Seasonality and Cyclicality? ☀️🔄

What specific data do I need to collect to begin this kind of analysis?

What specific data do I need to collect to begin this kind of analysis?

What specific data do I need to collect to begin this kind of analysis?

The ARIMA model sounds very complex. Do I need to be a data scientist to use it?

The ARIMA model sounds very complex. Do I need to be a data scientist to use it?

The ARIMA model sounds very complex. Do I need to be a data scientist to use it?

How is this predictive analysis different from just looking at our average turnover rate from last year?

How is this predictive analysis different from just looking at our average turnover rate from last year?

How is this predictive analysis different from just looking at our average turnover rate from last year?

The blog connects attrition to pay. What are other common "business drivers" to analyze?

The blog connects attrition to pay. What are other common "business drivers" to analyze?

The blog connects attrition to pay. What are other common "business drivers" to analyze?

My company is small and we don't have years of data. Can we still predict attrition?

My company is small and we don't have years of data. Can we still predict attrition?

My company is small and we don't have years of data. Can we still predict attrition?

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