Companies frequently end up with employees that just don’t seem to perform the way you thought they would. Reasons can range from new hires that don’t have the skill set they lead you to believe, are lazy, late, or whose overall morale is not a good fit for the company. The consequences can go far beyond the trials of making up for what the bad hire is lacking, and can actually cost your company a large sum of money. In a LinkedIn article, Karlyn Borysenko describes the detrimental effects frequent employee turnover can have on your budget. The time spent interviewing and hiring, along with the lack of productiveness, training costs, and loss of opportunity are expenses that add up fast. Borsyenko goes on to share the following statistics about employee turnover.
- 30-50% of an entry-level employee’s salary goes into finding her replacement.
- Approximately 150% of a mid-level employee’s salary goes into finding his replacement.
- 400% of a high-level or specialized employee’s salary goes into finding her replacement.
So how can you avoid bad hires or employee turnover?
1. Background Screening
JobScience discusses how the CEO of Zappos.com, Tony Hsieh screens applicants to save his company millions of dollars by reducing employee turnover. Hsieh believes that background screening is one of the easiest ways to catch them before they catch you. A reputable CRA can do the legwork for you to uncover any missing links. Someone may look great on paper but it’s the research that can reveal things that you wouldn’t have known otherwise and could save you some major headaches!
2. Take Your Time
It’s not uncommon for a business to find that all of a sudden they are in desperate need of help. Be patient, and in the mean time, work together to find a way to smooth out the kinks. Hiring someone to simply fill a position versus waiting and making sure you have a perfect fit can cost you big time in the long run.
3. Engage Employees
Getting employees involved, whether it’s with internal projects or after hours activities can improve and build relationships, making coming to work more enjoyable. Employee engagement is also a great way to discover special strengths of various employees that you may not have known otherwise and could be useful in different ventures.
4. Set the Tone
Establishing the right environment that allows for a little fun as well as productivity can help ensure employee happiness. Having this atmosphere set into place can also help in the hiring process. When you have a choice between two applicants that seemingly have everything you’re looking for, look for who would benefit and thrive in your company’s setting.
5. Employee Benefits
It’s hard to say a company needs to offer great health care. Depending on the business’ size and revenue, it just may not be in the cards. An article on AccountingWeb offers alternatives to the run of the mill benefits package that includes allowing the ability to work from home, work fewer days but longer hours, and flexible schedules. Catering to your employees needs can make them feel appreciated and act as a motivator.
There are plenty of costs that go into running business, so why add one more if it can be prevented. Evaluate your business. We want to know you are doing to prevent employee turnover. Let us know in the comments!