High Cost of Hiring
This won’t be the first time I ramble on about the importance of employee retention, it is something I will never stop talking about. Our transient work society is exhausting, even if it does mean job security for me. As a recruiter, I match people with jobs and the more often I do that the better. With that being said, I only find joy in putting good people at good places to work. When we make a placement, I want that person to succeed and thrive and stay with that company for a long time.
When companies are too busy to do hiring well, that is the best time to engage an executive recruiter. If you can’t find the time to fully commit to the lengthy process of finding, evaluating and interviewing candidates for your position then partnering with someone who can take that off your plate is a good plan. As recruiters, after we make the right placement, keeping the employee is up to you.
Regardless of how a person came to be employed at your company, keeping the employee should be priority numero uno. Let’s assume you have done the best job you can in hiring the right person for the job. Ask yourself what you need to do to keep them. Maintaining a stable workforce by reducing employee turnover should be your ultimate goal.
The cost of employee turnover is costly in both time and money. Clients are often surprised to hear that, on average, the cost of replacing an employee is 20-25% of the employee’s salary. When you combine the costs associated with hiring and training the employee with decreased productivity while the job is vacant and while the new person gets acclimated to the job, it is staggering. The more often this happens the worse shape your company is in.
High employee turnover is one of the easiest things for companies to control. Review your workplace policies. Think about implementing new processes and procedures that make working at your business better.
Do you offer the right mix of affordable benefits?
Do you have the supplies and tools needed for people to get the job done?
Is your team engaged and committed to growth and company success?
Is your team recognized and rewarded for a job well done?
Are there incentives and goals driving employees both individually and as a company to succeed.
Do your employees feel included, valued and appreciated?
If you have ten people who work on a team and the average salary is $50,000 and every year you are replacing 2-3 people, the cost (please read that as LOST BUSINESS REVENUE) is approximately $30,000 a year. If you are a large corporation multiple that by 10. Provide a great place to work where there is close to no turnover and you are putting money back in your business. Use some of that money in your employee retention program and it is a winner winner chicken dinner.
Retain don’t replace. Employees are worth more than you think. Keeping them makes good business sense.