Most CEOs and business owners are concerned with the high cost of recruiting new and professional talent. In 2017, PwC’s CEO Survey reported that a lack of skills is the biggest threat to their business as well as one of the most expensive – an average of $4100 is spend per mid-level job hire in the USA. Imagine the costs for C-Suite or managerial roles! Every year $20 billion is spent on outsourcing HR functions and the majority of it goes to recruitment agencies for hiring.
On average, companies are losing between 1% and 3% of their total revenue on the time it takes to bring a new hire up to speed.
It’s necessary to have on-going recruitment in a business in order to keep a company’s talent up-to-date and all positions filled. In South Africa, the average specialist recruitment agency charges 15 - 25% of the annual salary of the hired employee. Small, medium, and large businesses traditionally turn to recruitment agencies for their talent needs and this is how costs start adding up.
Unfortunately, the cost of hiring doesn’t end with hiring recruitment agencies.
· advertising expenses
· excessive time spent by HR employees writing job descriptions
· briefing recruitment agencies
· advertising the job in a variety of places and formats
· the cost of job fairs
· job board fees
· doing background checks
· and then, the most tedious: processing applications, interviewing, offering, counter-offering, and finally the acceptance signing of the contract
This doesn’t even touch on the cost of hiring the wrong person.
Do not despair! Of course, effective recruitment can also be cost-effective.
Not to say that in-house and external recruiters do not play a vital role in talent acquisition; rather that businesses need to become “smarter” in their hiring processes by implementing technology and other online resources.
Online recruitment platforms, such as Nomad Now, have helped in greatly reducing the common financial and time costs associated with recruiting. Allowing businesses to save money and time on both the sourcing of candidates, as well as their processing and tracking.
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