It seems like with every passing day, another major company announces their new tactic for offsetting inflation and anticipating an ever-looming economic recession. Indeed, as Mike Kappel recognizes in this article for Forbes, many are anticipating losses in their organization and are beginning to act accordingly in an attempt to offset anticipated losses. While Kappel offers some useful tips for those looking to ensure their business stays afloat with its current team aboard, the article entirely neglects the reality of ever-rising hiring costs.
Of course, no one wants to be blowing massive portions of an annual budget on hiring and rehiring, especially if the position at hand is one that tends to have a high turnover rate. But the reality is, if you don’t sufficiently anticipate and prepare for the processes and costs associated with hiring a new employee, you may end up making poor hiring choices or end up spending through the nose to hire a single employee.
So, how can you anticipate these costs and maybe even cut down on these before they threaten to sink your business? Let’s start with the current costs of a typical hiring cycle in the year 2023.
The Reality of Hiring Costs in 2023
In the wake of The Great Resignation and rising demands for remote work, it seems almost inevitable that many employers will continue to lose employees. What’s crucial, however, is that you only hire for a position once, and don’t find yourself losing money to mis-hires time and again.
Many employers will swear by only hiring internally for higher paying positions or roles with more responsibility and important duties. Others, however, will argue that only hiring internally for these positions restrict diversity and innovation in the organization. Ultimately, there are pros and cons to both. But what about the hiring costs of each?
Internal vs. External Hiring Costs
While everyone has their own hiring and filtering process, many employers tend to be a bit more thorough and thus may spend more money when hiring externally due to the costs associated with the tools necessary to make a well-informed hiring decision. And while these tools will range depending on the organization’s size and needs, the vast majority of employers tend to use the following when hiring externally:
- Postings on job board websites
- Candidate pre-screening surveys/questionnaires
- Applicant tracking systems
- Background checks/referral checks
And these are only the tools required for filtering and hiring the candidate, let alone those needed to on-board and train the employee.
For internal hires, there are then the costs of benchmarking the former employee to match their success in new candidates, any costs that may come with training and changing their position to their new one, and perhaps even the time they may need to spend training their replacement.
To calculate the total cost per hire, then, you’ll need to add together the above costs and divide them by the number of people hired within a given time period.
If the above sounds overwhelming, it may be because it is! Hiring both internally and externally can be overwhelming, especially when a company doesn’t have a dedicated human resources department. So, if you ever find yourself needing to replace an employee on your own, or even in a way that is far less time-consuming and costly than the typical hiring cycle, consider upgrading your processes with Workwolf!
How Workwolf Can Reduce Your Hiring Costs
If you’re currently hiring without Workwolf, you may be using a mishmash of various tools and external help to make hiring decisions. And naturally, these processes will certainly not be seamless, let alone perfectly synchronized or automated to make the hiring and filtration process as effective as possible for you or your future employee(s). Here are just a few ways Workwolf can make your current system better (and more cost-effective)!
Replace Your Job Posting Website Costs
Depending on the website or platform you’re currently using to post your job openings, you may be spending upwards of $500 per month to find a suitable candidate. ZipRecruiter, for example, offers packages for employers that range from $400 to $560 C.A.D. per month, depending on how many features you’re willing to pay for.
LinkedIn, for another, offers options that allow you to set a maximum budget per month, but ultimately, if you set a budget and your posting reaches as many candidates as your budget allows, your campaign will automatically pause. And this may stymie organic interaction with the posting.
Workwolf, on the other hand, starts at just $329 per month to get free job posts, unlimited pipelines for hiring various positions, and countless freebies, such as unlimited soft skills assessments and match percentage screening. Speaking of which…
Cut the Costs of Soft Skills Assessments
Soft skill assessments are becoming an absolute must in the HR industry. After all, everyone knows you can always train and teach a person hard skills needed for a position, but soft skills are an entirely different story.
In an article on onboarding processes, Gallup noted that they found that “new employees typically take around 12 months to reach peak performance potential.” And that’s if they’re a good match for the position at hand. If a candidate isn’t well suited for their given position, they may struggle to reach deadlines and expectations for months or years, if ever.
Many soft skills assessments can be purchased from HR management companies and other contractors, but these surveys can range from tens to hundreds of dollars per candidate.
Packfinder, Workwolf’s very own psychometric-based soft skills assessment, is free for all Workwolf Business users to offer their candidates. That’s one less cost for you and one more reason for you to join our pack.
Rethink Your ATS
Not convinced to switch over quite yet? Let’s talk about your current applicant tracking system (ATS), then.
Depending on the ATS you use, your filtration process may be not only outdated but even discriminatory. If you’re filtering candidates by any marker of identity, or even solely on what credentials they have, you may be restricting your searches to only those who are of a certain majority identity and privilege. So, even if you want to diversify your team, your ATS may in fact be holding you back from actually doing so.
Of course, some roles require more hard skills than others, but soft skills will always reveal a candidate’s top potential. We at Workwolf filter first and foremost for soft skills that you can either preset or benchmark based on your top performing employee(s). This means switching from an ATS to Workwolf will make your filtering process both seamless and equitable overnight.
Ready to try it out for yourself? Sign up here for your free Workwolf Business account to test the waters. Then, when you’re ready, upgrade to Workwolf’s Premium or Enterprise packages for even more bang for your buck.
