If you’ve ever hired a new full-time employee for your organization, you know that it can be a stressful and time-consuming process. But, do you know the actual cost of a new hire for your organization?
Earlier this year, the Society for Human Resource Management (SHRM) discussed an attempt to standardize the process of determining cost per hire. The process is oft-debated and bantered, but there are some basics you should consider when determining the cost per hire at your organization:
- Recruiting Costs. Print advertising, job fairs and job boards can add up. Plus, any costs that are associated with your applicant tracking system (ATS), if applicable. Each has its own fees and costs, and they should be carefully included in the total.
- Marketing Expenses (outside of recruiting costs). Your marketing budget — outside of classified ads — can and should be at least partially taken into consideration for your cost of hire. The considerable spending that can occur in a marketing budget can have a significant impact on the number and quality of candidates.
- Referral Bonuses. If your organization pays any type of bonus for referrals who are hired into your organization, they should be included in your cost per hire.
- Employee Salaries. The cost for salaries of your recruiting team, as well as any administrative costs for the hiring period, should also be included.
- On-Boarding Expenses. Any necessary on-boarding costs should be included in the final cost per hire.
- Training Costs. Training can be very costly for an organization. Salaries for the trainee and trainer should be considered, as well as any productivity lost during the training time. Any travel expenses, or cost for supplies or a training facility, should also be considered.
Searching for ways to lower your cost per hire?
Contact the recruiting experts at Peoplelink Staffing. Our team is comprised of experts in their fields – experts who can assess your organization and identify ways to lower your cost per hire, and increase your productivity.