The Cost of Hiring New Employees

THE COST OF HIRING NEW EMPLOYEES 00000 WHAT IS THE COST OF A NEW HIRE? Cost-Per-Hire Statistics Cost-Per-Hire By Recruiter Assignment for Key Industries INDUSTRIES WITH HIGH COST-PER-HIRE RECRUITER ASSIGNMENT OF JOB REQUISITIONS Number of Cost-Per-Hire Positions Hired Industry Recruiter Assignment of Job Requisitions Cost-Per-Hire Time-To-Fill 10 Association-profession/trade Manufacturing durable Publishing $5,582 2,401 28 days By job specialty or function By business unit $5,159 $2,958 $4,438 1,501 $3.939 39 days INDUSTRIES WITH LOW COST-PER-HIRE Source 2011-2012 SHRM Benchmarking Database Industry Number of Positions Hired Cost-Per-Hire Services-accommodation $1,062 316 $1,320 4,243 Waste management Arts and Recreation 184 $1,394 Source 2011-0012 SHRM Benchmarking Database BREAKDOWN OF HIRING COSTS Advertising agency fees Employee referral bonuses Recruiter salary and benefits Employee relocation costs Sign-on bonuses Third party recruiter fees Travel expenses for applicants and staff WHAT IS THE COST OF A BAD HIRE? In a Harris Interactive poll, 41% of respondents said that the cost of a bad hire was greater than $25,000 and 25% of respondents said that the cost was greater than $50,000. THE IMPACT OF A BAD HIRE The participants in the Harris Interactive research identified some of the costs: 41% 40% 37% (36%) (22%) Less productivity Lost time to recruit and train another worker Cost to recruit and train another worker Negative impact on client solutions Employee morale negatively affected FOUR CAUSES OF BAD HIRES Need to fill the job quickly – identified by 38% of participants Not sure, sometimes you make a mistake - 34% Insufficient talent Didn't check references - 11% intelligence - 21% FIVE TIPS FOR HIRING THE RIGHT CANDIDATE Making a good hiring decision not only increases employee retention, but also reduces the costs associated with a bad hire. Here are five tips for hiring the right candidate. 1) 2 3 4 5 Take a fresh look at the job description Enlist help from your colleagues and compare style and ability closely during by asking for employee referrals. Consider soft skills like Get to know the person by listening Sell the candidate on the advantages of working with your organization. communication to collaborate. it to your current needs. interviews and building rapport. Sources: http://www.shrm.org/research/benchmarks/documents/cost-per-hire20article_final.pdf http://www.recruitingblogs.com/profiles/blogs/bad-hires-stats-costs-avoidance-poor-excuses-and-other-thoughts http://resources.dice.com/report/the-cost-of-bad-hiring-decisions/ recruiterbox