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What You Should Know About the Cost of Hiring a New Employee

One of the benefits that of hiring temp labor is said to be the inherent cost-effectiveness of the approach. Companies that weren’t able to improve their employee retention are said to be in trouble because they lose a significant portion of their revenue to bring in a worker in order to maintain the workforce.

Recruiting + Training + Equipment + Benefits = Upfront + Hidden Costs of Hiring

It’s the time of the year again when you’ve got an empty slot among your team to fill in. Technical work or not, problem is, you can’t just hire someone out of the blue. And so, you need to pay for creative ads and for the time-in of the internal recruiter as they review resumes, conduct interviews and tests, and screen, and double-check them before you get to meet them. While not every person is subject to the grueling process, those who do cost a company both indirectly and directly.

The one to come through it all and be deemed perfect fit for the position has cleared the first step only because the company now needs to train them adequately for them to be productive for the company. What’s important for you to remember there is that it’s not just the new hire who would need the training but also the current employees who need the education and training.

This is followed by the cost of having a dedicated office space, including ergonomically designed furniture and software tailored to the employees’ need, before you can even start to factor in the salary and other benefits like health insurance and retirement plans for them.

Is it worth it? The answer depends on whether they can yield greater profit than the initial cost depending on the respective profession.

Is there an alternative? Leverage a skilled labor workforce.

The Cost of Temp Labor

Yes, it is cheaper in comparison, but that doesn’t mean the hiring the services of a New Orleans employment agency, for instance, would not cost your anything. You may want to have your HR personnel review a couple of resumes or interview the candidates rather than solely rely on the expertise of the professionals at firm. So yes, there are some recruiting costs. Then there’s the invoice processing and salary of the temp worker, including too the firm’s fee that is taking care of variables like insurance, taxes, and administrative costs for you.

Of course, for a temporary position, you may choose to coach a current employee too who’s already familiar with your work ethic and who has demonstrated the fundamental problem-solving skills on previous assignments. However, the skilled labor is often a source of new (specific) skills and knowledge that comes with experience. They may bring new energy as well and so revamp and energize your workforce. Plus, it may not be always be the case that you are able to spare your regular employees, especially during peak demand periods not to say that a temp worker lets you assess if you really need to hire a new, full-time employee or if a temp can manage the job satisfactorily.


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