What is your cost per hire?
If you’re aiming to recruit the top talent, my guess is it’s not cheap. A 2016 survey by the Society of Human Resource Management found that the average cost per hire is more than $4,000.
And if you use a recruiter, chances are the cost will at least double. In fact, most third party recruiters charge about 10 to 35 percent of the employee's first year salary. So for example, one $50,000 a year employee could cost the business $10,000 or more to hire them.
That same SHRM survey showed that the average employee tenure is about eight years long — with millennials more likely to job hop than older generations. The average annual turnover rate sits at about 19 percent, with involuntary turnover at 8 percent.
What if I told you that it was cheaper to focus more of your energy on retaining and developing talent you already have? That’s right, your existing employees.
Millennials in the U.S. workforce value career opportunities and development more than company loyalty, the report states. However, most companies aren’t putting as much focus on development opportunities as the new generations of employees are demanding.
The employee journey is much like the customer journey, and it begins the very first moment you become acquainted with a potential hire. What are you doing to show you value your employees?
If you aren’t loyal to your employees, don’t expect them to show it to you. As economic conditions fluctuate, so does employee behavior. Employees in 2020 are not as insecure about job opportunities. According to SHRM, 45 percent of employees reported they are likely to seek out other job opportunities, which is higher than the recent past. This pattern drags out the recruitment process, leaving companies to want to focus on recruitment rather than retention.
Switching your focus from recruitment to retention is all about mindset.
When human resource departments pour all of its energy into recruitment, they demonstrate a perspective based on lack, rather than abundance Are you spinning your wheels in search of as many job prospects as possible, out of fear? Or, are investing in and believing in the talent you already have?
To focus inward on retention and employee development demonstrates an abundant perspective. Your business has faith in its talent and belief in its employee’s success.
Your mindset is like a light switch: once it’s flipped, the lights are on and you are aware of the opportunities that lie ahead.