According to a new HR Barometer report from Adare Human Resource Management, the cost of recruiting a replacement employee is now more than €14,000.
The report also found that staff turnover averaged 14% last year, up four percentage points from 2017 and nearly half of those surveyed said it was taking longer to fill posts.
RECRUITERS managing director Gerard Doyle said the cost of replacing employees is so high because companies don’t always know how to find the right hire, which is what slows down the process.
“We’re at the top of the labour market so there’s a skill shortage and typically, employers don’t know how to find the right candidates so they make incorrect assumptions about how to advertise their role,” he said.
Employers also often make an assumption that, while it’s expensive to replace employees, it would be cheaper for them to do it directly. “But, in our opinion, it’s more expensive because the time to hire is longer and they don’t have the access to the quality of the candidates they need,” said Doyle. “Our own research is showing that the fastest way to do it is through a recruitment agency or through employee referrals.”
Additionally, when companies advertise their roles directly, potential candidates might make their own assumptions about the role and company and choose not to apply. Recruitment agencies can pitch a job differently and they also advertise blind, so they have better access to a more passive pool of jobseekers.
“When employers don’t know where to look, they often miss an opportunity to get it right the first time. Then they might go to an agency but by then, four months might have passed.”
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Written with contributions from the RECRUITERS team
Piggy bank photo by Fabian Blank on Unsplash
