Gather together a group of business owners or managers today and the topic of conversation naturally turns to the difficulty of recruiting and retaining employees. The first of two articles on these challenges, this one will deal with recruitment issues.
The cost to recruit and train an employee for an entry-level position is estimated to be about 16% of a year’s wages. Recruiting costs for senior managers can range as high as 200% of the position’s yearly salary. The recruitment process is time-consuming and expensive. The traditional method of hiring was to place an ad, expect to receive an overwhelming number of calls and applications, screen out most of the applicants, interview the top three candidates and hire the one who seemed to be the best fit for the position. This strategy does not work in this current labour market. Some companies have gotten so desperate they have resorted to paying candidates to come in for an interview. It’s a given that your compensation package must be competitive in order to attract the best candidates but potential new employees are looking beyond compensation. Also important to them is a work-life balance, flexibility, work that feels meaningful, shared values, and opportunities for growth.
Reported HR woes include “job ghosting” by new hires who just don’t show up for work. Increasingly common are situations where new employees are asked to do a task they don’t understand or are requested to do something they don’t wish to do and simply walk out. These are examples of employees who were not well-matched for the job, were not properly trained, or found themselves in a work environment that did not provide the necessary support. If you don’t have time to recruit, onboard and train new hires properly, you will find the time to do it again
When it’s so difficult to find employees you are tempted to place any warm body. Hiring the right person can bring you new customers. Sometimes hiring the wrong person will result in you having to do a lot of clean up to restore your clients’ faith in your business. Recruiting is a full-time job. Business owners must be looking for the next best employee at networking events, in the grocery line-up, at their child’s sporting event, and at get-togethers with family and friends. When you have identified an appropriate candidate, it is crucial that you take the time to check references and ensure they are a good fit. Go beyond the information and contacts that are readily available. Listen to what is being said and for what isn’t. Once you have made the hiring decision, tailor the orientation and training so as to establish the best possible foundation for your new hire.
And then, when you are congratulating yourself for finally placing a winner, turn your attention to how you are going to keep that person engaged and employed. You don’t want to watch your investment walk out the door to another company which more clearly demonstrates their long-term commitment to their employees.