2 Ways to Save Money on Recruitment

talking with client

For any business, the need for extra hands usually spells growth and success. What many don’t know, though, is the hiring process could be costly, especially if you take a long time to choose an employee.

Investopedia has a good rundown of the hiring costs:

  • You include the salaries and benefits of your HR team. If you don’t have one yet, then you account for utilities and labor spent on checking resumes and interviewing applicants. You also need to add the price for advertising.
  • If you don’t hire the candidate for whatever reason, it could mean a loss for your business. Turnover costs could reach over $3,000 per person.
  • Even the most experienced employee still goes through onboarding and training. The average cost is at least $1,200 annually per worker.
  • Since you can’t expect someone to learn the job in a day, you need to set aside at least two weeks of training or adjustments. During this period, the worker will be less productive, but they may already receive their full salary and benefits.

It’s no wonder that it takes about six months for a company to break even from all the recruitment and training costs!

However, your business won’t meet its goals fast without people to help you. How can then reduce training and hiring expenses without compromising the recruitment process? Here are two ideas:

1. Streamline the Hiring Procedure

On average, it takes about 36 days to fill in a position. If you can shorten that in two weeks, the better. Even if you don’t have an HR team, you can do that with the right tools.

For example, you can already use a candidate tracking software tool, which helps you sort or organize applications and resumes in an easy-to-use interface or dashboard. Even before you begin the initial interview, you can already weed out some candidates.

In the meantime, the system can store these files in a database, allowing you to create an applicant pool. If you have to open more positions, you can begin looking through the data first, saving you time and money.

2. Note the Difference Between Job Expectations and Descriptions

Recruitment for a jobA job mismatch could cost businesses a lot of money and increase the turnover rate. Estimates suggest that it could be as much as 16% of the annual salary for a low-wage job. Just imagine how much it will be for a higher position that demands special skills.

A mismatch also throws away much of what you spent for hiring and training down the drain. In the end, you may have to start all over unless you want the person to continuously drain your profits.

However, you can avoid that in many ways. Besides screening applicants in every step, you need to be clear with your job expectations and descriptions. Both don’t mean the same thing, but they must complement each other.

The more specific they are, the better. You can use these pieces of information as benchmarks when screening your candidates.

While you can’t expect to grow the business by yourself, you should ensure every expense and process count. By streamlining the process and being clear with your recruitment needs, you can get the best value for money.

About the Author

Scroll to Top