The real monetary value of choice and decisions
Time is Money. Benjamin Franklin is as right today as he was in 1746.
When you take into consideration advertising, external recruitment agencies and the time to screen, read CVs, undertake the interviews, follow up and appoint, it can cost a business up to £50,000 for their first year employed new member of staff earning just over £27k/annum according to a report by Undercover Recruiter. Businesses can spend anything from £750 to £3,000 on the recruitment of a new team member and that’s if they run the campaign internally and discounting the cost of the paid member of staff to undertake the recruitment. A significant business expense especially if you’re recruiting a large number of people.
Some studies (SHRM for example) put the cost of recruitment at an average of 6-9 month’s salary. For a mid-level Manager earning £40k, that’s an eye-watering £20k - £30k in recruitment and onboarding costs!
Socialising can be an amazing way to lower your costs! Social media is a very effective way you can communicate what you’re about as a company, resulting in attracting candidates that fit with the company ethos improving the overall quality of your next appointment and reducing turnover.
If you don’t have a referral scheme in place, you really should. Asking, and incentivising, your employees to make applicant recommendations is a brilliant way to use your existing team’s far-reaching network to help keep recruitment costs down. Your employees are your best marketeers!
Think strategically and consider the bigger picture. Reducing overall costs might mean you have to increase some budgets to lower others. For example, increasing your online advertising budget could lower your external agency costs because you have been successfully able to fill more positions directly.
In order to successfully manage any recruitment campaign, it’s imperative to have the right tools for the job. Across the board. Industry software could significantly lower your associated recruitment costs such as those related to the time taken (and the salary of) those responsible for the hiring. HR and recruitment technology can not only automate mundane and unnecessary tasks but it can streamline your processes _and_ get you compliant. Take DigiRec, for example, our app for all of your interviews saves you over half an hour of admin for every candidate you interview. For 100 candidates, that’s a whopping 51 hours of admin you didn’t have to do.
If the standard of candidate and quality of your hire is superior through an agency then who you can attract and recruit yourself, then the agency fee is offset considerably. It can also save you time and money, lowering your associated costs.
The biggest cost associated with recruitment is getting it wrong. The estimated cost of a wrong hire is thought to be in excess of a staggering £50k! So investing in tools that help you properly assess candidates is a critical factor in achieving cost effective success long term. All good recruitment software will maximise productivity and this will, in turn, allow you to spend more time with your candidates. This ensures a more thorough assessment resulting in a better appointment. Not only does this stop bad placements it also significantly improves your candidate’s experience. Spotty dog. A poorly run campaign or inefficient recruitment processes can badly effect candidate quality, increase administration, duplicate work unnecessarily and even decrease your job satisfaction. A simple, well placed piece of recruitment software or tool can change the outcome of your campaign and keep you in budget.