Finding the right people to fill empty positions within your organization can be costly and time consuming. The process can easily overwhelm all other company goals, especially if the skills criteria are specific and difficult to locate.
In addition, it can be a costly affair. However, thinking of “cost” as a one-dimensional, tangible metric that only encompasses items such as
- the cost of an online job post or
- the money spent for a lunch interview
- the cost of reimbursed travel expenses
will not give a true and accurate picture of the total cost to hire an employee. Time must also be taken into account. The hiring process is very task-oriented, and tasks take time. In business, time is money, so what is your time worth?
When thinking about the cost to hire a new employee, you should include the obvious expenses around
- Recruiting – fees for ads and online job boards, sourcing, costs of job fairs and employee referral programs .
- Onboarding – costs for training and onboarding programs.
- Employment – salary, benefits, payroll expenses, etc.
But in addition to this, you need to quantify and include the costs of your internal staff’s time in all your analyses. Some of these costs can include:
· Sourcing Costs – these are incurred during the search for candidates. How much time is needed to reach out to your entire network in your search for both active and passive candidates? How long will it take to create/update an accurate job description?
· Screening Costs – these are the costs (in both hard dollars and time) that the internal administrative staff expends to open, respond, and route résumés to the hiring team. Just how much time is your staff person going to spend screening résumés? According to CareerBuilder, 40% of HR managers receive over 50 résumés for every available job. That is a lot of résumés to screen, sort and pass on, so it is important to analyze just how much time is going to be spent processing them.
· Preliminary Interviewing Costs – there are also costs wrapped around preliminary phone interviews and the cost to have internal staff prepare, conduct, summarize and communicate the results of those interviews.
· Interviewing Costs – this includes not only actual reimbursable expenses, but the time spent scheduling interviews, preparing for interviews and the actual time involved (for all employees) in conducting the interviews. It is important to note that, especially with first-round interviews, you are actually paying your employees to take time away from their core responsibilities to interview candidates, most of whom are not a good fit.
· Testing and Follow-Up Costs – these costs are for pre-employment tests – including the time it used by employees to administer these tests – and the time and cost for follow-up with candidates during negotiations and to notify those that were not selected.
It costs money and resources to go through the hiring process. Partnering with a trusted human capital management (i.e. staffing) firm, like Snelling, allows you to focus your time and resources on the core aspects of your business, while we undertake your search for qualified candidates. You only review the “cream of the crop”, and do not have to allocate time to sorting through vast number of résumés from unqualified candidates. No more ad-hoc sourcing costs and fees; with Snelling, you are tapping into our network of qualified candidates.
NOTE: A full-color, downloadable PDF is available.