WorkLore

But why?

With the privilege of summer road travel comes the ads touting “we’re hiring!” on billboards, the back of work trucks, you name it. It’s so enthusiastic. But should it be?

If you’re growing and need more people, that’s great! 

If you’re turning over employees like a milkmaid churns butter? Well, that’s a different story. 

It costs between 50% and 200% of an employee’s salary to replace them. The more complex the job, the higher the cost. 

So for an employee earning $60,000 a year, you’re spending somewhere close to $30,000 to replace them. 

For an employee earning $200,000 a year, you may be spending $400,000 to replace them! 

How do those numbers happen? 

Direct costs Recruitment, onboarding, severance, headhunters

Indirect costs Lowered productivity (this is a big one!), lower morale, time spent by other team members taking over tasks, interviewing, training and supporting new hires, knowledge and experience lost

This is why every time I see “We’re hiring!” I wonder if it is an investment that will support growth, or a cost of high turnover. The two are very different.