While it may seem like a no-brainer to take care of hiring internally, many companies find that this can cost them more money, take longer, and may result in lower-quality candidates. This isn’t a new challenge for businesses. But it’s even more difficult now due to a smaller staff, leaner organizations, and a historical candidate shortage.
When it comes to money and time, loss of cash flow can have an immense impact on your business. One way to reduce hiring costs while keeping your business productive is outsourcing hiring to staffing companies. An effective staffing and recruiting partner will decrease time and financial expenditures while bringing in quality employees.
The 3 risks of managing hiring in-house
- Increased turnover
While it may seem easier and more cost-effective to handle hiring internally, studies show this may result in lower-quality candidates and hires who are not the right fit for the role. A single bad hire can impact team morale and ultimately increase employee turnover. One study found that the average cost to replace just one employee can have a huge financial impact on your business.
- $1,500 for hourly employees
- 100% – 150% of an employee’s salary for technical positions
- Up to 213% of an employee’s salary for C-suite positions
- Loss in productivity
When companies handle hiring internally, the responsibility often falls on a current employee — all while continuing to do their “day job”. Inevitably, this requires a significant investment of their time, as broken down below:
- Choosing where to spend money to post the position. There are several sites candidates use to job hunt. Which ones are best? It takes time to do the research and decide which sites make the most sense for your role(s). Time: 3-4 hours
- Posting the job. From crafting the job description to going through the steps to post it, it’s not as simple as one click of a button. Time: 1 hour
- Applicant review. The employee will be weeding through hundreds of applicants and resumes in hopes of finding a needle in the haystack. And while posting the job to various online boards may garner several hundred applicants, it still doesn’t guarantee finding the perfect match. In fact, in today’s job market, the “spray and pray” method is just one tool in the recruitment arsenal, not the only tool. Time: 20 hours (based on 300 connections)
- Interviewing. Scheduling and conducting interviews, reference checks, and required pre-screenings. Time: 20 hours
Total time: 45 hours
- Significant financial investment
The cost of a new hire does not stop with getting them interviewed, onboarded, and paid. You’re adding another person to your payroll and benefits. Not to mention the exposure to worker’s compensation and any unemployment costs.
By passing the hiring off to a trusted partner, you could then focus valuable time on efficiently operating your business.
True cost savings when partnering with a staffing agency
Hire candidates faster
As demonstrated above, there’s a long checklist that needs to be completed before a new hire even begins working. Bonney deals with the time-consuming tasks of combing through candidates, screening, interviewing, and preparing candidates for the position — all while you are focusing on your core business.
Recruiting firms often fill vacant positions faster than you expect. Being relationship-driven and technology-enabled, Bonney has access to tools and resources to deliver superior customer experience and faster access to qualified candidate — bearing the brunt of the responsibility.
Reduce training costs
Every time you make a new hire, there is a certain learning curve or training that has to take place for this person to perform their everyday duties. Hiring through a staffing firm will most likely eliminate/reduce your training costs because we pre-qualify candidates to find those with the skills you require to perform the job.
Improved workforce flexibility
When companies choose to outsource staffing, they are hiring contracted/project workers, which allows them to increase and decrease staff depending on the workload without long-term financial commitment. This will allow you to run an efficient business as demand for services changes day by day.
“Try Before You Buy” a candidate before you commit
A great added benefit of working with a staffing agency is that you can employ temp and temp-to-hire workers. You can see how they fit and make sure they are the correct match for your business before you bring them on full-time. If for some reason they don’t work out, you can ask your staffing partner to end the assignment. You are not responsible for unemployment or the necessary paperwork to let someone go.
Alternatively, many recruiting firms also assist with sourcing for direct-hire recruitment. Your chosen candidate will be hired by your company on Day 1, and you’ll just pay a one-time placement fee.
And if they don’t work out? You won’t pay until we find someone who does. It’s part of our guarantee. We’re committed to bringing you the right talent the first time.
Lower overhead costs
When it comes to temp and temp-to-hire workers, staffing and recruiting firms can offer significant financial savings when it comes to the employer costs that you’d normally provide to employees. Health benefits, 401k, sick days, PTO, workers compensation, unemployment, and all employer taxes are the responsibility of your staffing partner.
The Takeaway
As you can see, when hiring internally there is a much higher cost than simply posting the job and what you pay the employee.
When you trust Bonney with hiring, you can be confident that you’ll have a qualified workforce to maximize productivity without the effort and cost of recruiting and onboarding.
You have far more important business aspects to worry about. Staffing and recruitment is our specialty, so you can focus on your business specialty.
Contact us to discuss the improvements and cost savings you could see with a staffing partner like Bonney.
