🧮 What is Shrinkage in Workforce Management?
Shrinkage refers to the time when an employee is paid but not available to handle customer interactions (calls, chats, emails, etc.).
📍 Types of Shrinkage:
1. In-Office Shrinkage
This includes time when the employee is present in the office but not handling interactions.
Examples:
- Team meetings
- Training sessions
- One-on-one sessions
- Coaching
- System issues (if in office)
- Login/Logout time
- Breaks (if not counted in working hours)
2. Out-of-Office Shrinkage
This includes time when the employee is not present in the office.
Examples:
- Sick leave
- Casual leave
- Earned leave / Paid time off
- Public holidays
- Emergency leave
- Unplanned absenteeism
- Maternity/Paternity leave
🧾 Shrinkage Formula:
Shrinkage (%) =(Total Shrinkage Time / Total Available Time) × 100
📘 Example Calculation:
Let’s say a team of 10 agents, each works 8 hours/day = 80 total working hours/day
Scenario:
- In-office shrinkage:
- Training: 1 hr/agent = 10 hours
- Meetings: 0.5 hr/agent = 5 hours
- Out-of-office shrinkage:
- 2 agents on sick leave = 2 × 8 = 16 hours
Total Shrinkage:
- In-office = 10 + 5 = 15 hours
- Out-of-office = 16 hours
- Total shrinkage = 15 + 16 = 31 hours
Total available time = 80 hours
So,
🔹 Shrinkage % = (31 / 80) × 100 = 38.75%