17/06/2022
How many times have we all read recently in the press, a blog, or social media about ‘the Great Resignation’?
Everyone has an opinion of what it is, what and how do you conquer it and how to move past it, but is it really that simple?
There is a copious amount of research around, looking at how much it costs a business, to replace a lost talent. Depending on the study you read, this figure varies from £12,000 to £30,000. I am not sure how easy it is to put a definitive figure on that cost, because there are so many variables.
In their Resourcing and talent planning survey conducted online in May 2021 the CIPD state “the median cost of recruiting senior managers/directors (£3000) has fallen over the last few years in all sectors. Nevertheless, it remains considerably more expensive to recruit for senior positions than for other employees, reflecting the higher-cost recruitment and selection methods used.” They do however go on to say that due to the low numbers in various categories that ‘the median should be considered with caution’ and that it has ‘an accuracy of plus or minus 20%’, and refers to 2median average cost per high 9including in-house resourcing time, advertising costs, agency or search fees) for estimates accurate to +/- 20%”
Of course the financial obligations are not the only factors, there are three others you should take into consideration as well:
1 The financial implication on your business
Have you recruited a staff member recently? If you have, you will know financially it costs a tidy sum. You are probably looking at a 15-20% commission (on final salary) fee on a recruitment company alone (if you use one). Add on to that any advertising, social media ads, and it is no wonder the research out there quotes the cost to a business of up to £30,000 per vacancy to fill. There are other financial costs to your business though, not just in recruiting as you also have your in-house staff time for creating job descriptions, shortlisting, and interviewing time, plus once you have recruited there is the time and money needed to onboard and for training.
2 The Human implications
The human factor of course does not just refer to recruitment but also to those employees who are going elsewhere. Your current people may be less engaged, already be feeling disillusioned, which is the last thing you want to portray to new employees, especially if you have not communicated well enough to your current talent. These are the people who will be engaging and onboarding or training your new employee. Add to that those who have left, may now be working for your competitors too.
3 Your brand reputation
As a business brand reputation is everything. The last thing you want is for any new staff to have an effect in customer services or decreased quality of the service you offer. Disgruntled employees or ex-employees can truly make or break your brand. Common things that come out of speaking to the people left behind are that they feel over-worked, have a poor work/life balance, feel unappreciated, have no opportunity for growth or development, and most worryingly enough have a bad manager!
Is the key therefore to go back a step and look at your staff retention before you get to the stage of losing your star people?
The CIPD, in their Resourcing and talent planning survey said in their recommendations that “Businesses need to keep and upskill their workforce and think creatively about the future of work and how to diversify talent. The winners will be those who are reshaping their talent strategies now to ensure they continue to attract, develop, and keep the best, and who are applying the same, rigour, effort and sophistication to resource planning to designing overall business strategy.”
On 24th May 2022 the BBC News’ Business Reporter Daniel Thomas discussed a PwC survey of 2000 people, reporting that almost one in five said that they are likely to change jobs in the next 12 months to seek not only better pay, but a greater job satisfaction. The Office of National Statistics’ (ONS) first quarter data (January and March 2022) also reported for the first time since records began, there were more job vacancies than unemployed, showing truly that it is an employee market. This of course also means that businesses should be doing all that they can to keep their best talent.
But is one in five a truly exact statistic?
The HR Review delved deeper (19th May 22 – The great reshuffle continues – how can employers mitigate this? Amelia Brand) and commented that: “A third of white-collar workers have stated that they are very likely to leave their job in coming months, unless more understanding and assistance is directed towards personal matters, which impact their work.”
Like everyone, I will be keeping a close eye on what happens next and will of course always be there for my clients to advise and guide them. My strategy is to help future proof companies and ensure their assets (employees) are loyal to their employers by feeling valued, treated fairly and appreciated.
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