IT COSTS TOO MUCH TO USE A SERVICE OR DOES IT? time=money

Do YOU really understand the costs of hiring, firing and retaining?

Turnover Costs:
The rule of thumb in considering the cost of turnover ranges from 100-200% of that persons compensation.

First, figure out the real cost of employment:

Compensation +
• Taxes/SUI/WC +15-20%
• Benefits +25-60%

The basic costs of employing someone can be between 35-80% higher than gross pay!

However, this figure does not include the cost of non-hard expenses such as:
• Recruitment
• Training
• Loss of new business
• Lack of attention to current clients
• Cost of having a desk/phone, etc. not being used
• Time it takes managers to hire a replacement
• Travel/Entertainment
• Costs of profiles, tests, credit/background checks, etc.
• Relocation fees
• Goodwill – in-house moral/outside reputation
• Separation costs (legal, severance)

For the above reasons, many consider the rule of thumb in figuring out the cost of replacement of 200% of departed employee’s compensation package.

How long does it take to hire?

The average time it takes to find and hire quality talent in advertising sales ranges from a minimum of 3-6 weeks minimum for sellers and often up to 6 months for managers.


TYPICAL HIRING HOURS & COSTS*

Advertising: $3,000-$7,000

Creation of job profile; place ads, approval 3-4 hours

Recruitment: 75-150 hours

Time evaluating resumes, screening phone calls and
setting up first round of interviews: 12-15 hours

First round of interviews (45-60 minutes each): 30-40 hours

Second round of interviews: 10-20 hours

Third round of interviews/multiple managers: 5-10 hours each

Profiling: $50 to $350 each
Plus time to set up

Reference checks: 2-3 hours each candidate

Background checks: $50 to $150 each

Credit Checks: $50 to $150 each

TOTAL TIME SPENT: 137-292+ hours

Depending on who in your organization is responsible for these duties, hourly costs of labor can vary from $20 to $125+ per hour.

An average compensation for an experienced media manager: $150,000
Average cost of employment x 150% $225,000
# of hours worked annually (40 x 52) 2080
Hourly cost of employment $108.71
Estimated Search hours average 215 x hourly cost $23,372.65
Plus hard costs (estimate on 5 finalists) + advertising + travel $15,000

Total cost to hire $38,372.65
Cost of lack of attention of manager/lost business ???