Unemployment in the US has dropped to 4.1%, a low that hasn’t been seen since 2000 and wages are climbing at a steady rate in an increasingly tight labor market, according to the New York Times. At a time where automated systems are a given, talent is emerging as the competitive edge for businesses across several different industries.
High cost of turnover
High turnover is undoubtedly expensive. Josh Bersin of Deloitte estimates “the total cost of losing an employee can range from tens of thousands of dollars to 1.5-2X annual salary”. While initially, a new hire costs money, the ROI on long-term employees grows the longer they remain. Maia Josebachvili with Greenhouse Software has found “Great management and development practices that implement coaching and training can improve an employee’s performance by 20% in a year.”
The total cost of losing an employee can range from tens of thousands of dollars to 1.5-2X annual salary - Josh Bersin Click To Tweet
Good employee retention makes recruiting an unnecessary expense.
Recruiting new talent is a huge investment of time and money. Relying solely on outside recruiters or talent sourcing services can cause complications to finding employees that fit and stick, as they may not have the advantage of understanding the culture of a company or how personalities gel internally. Dive a little deeper into how your company’s bottom line is affected- the Society for Human Resource Management (SHRM) has calculated a formula to easily tracking the cost of recruiting and onboarding new hires.
Great management and development practices that implement coaching and training can improve an employee’s performance by 20% in a year. -- Maia Josebachvili Click To Tweet
The high cost of a bad reputation
The Age of Transparency is here and it isn’t going away. Competing for new talent in the digital age can be problematic and expensive, especially for small and mid-sized companies. Platforms such as Glassdoor rate and rank companies according to employee satisfaction. Bad reviews and low rating number can discourage valuable candidates from applying and encourage great employees to look elsewhere. Once the information it is out there….you can’t take it back. Of course, attractive benefit packages and a healthy work/life balance are important- but a company that truly works from the model of collaboration and values communication first and foremost holds onto great employees.
Rally Corp’s solution for employees and teams is an easy and effective way to address concerns internally by keeping your talent happy and having the ability to act fast and avoid a bad reputation. With an option for both a text message and online form submission, our platform empowers human resources professionals and upper management to receive and address employee suggestions and concerns in a way that values and supports a positive and safe environment. Giving team members an easy-to-use, confidential way to be heard allows them a confidence and anonymity, to be honest without fear of repercussions. Address the concerns of your staff before they feel the need to take it public.
Try our employee turnover calculator today and schedule a free consultation. We’ll gladly share our research with you!