In some industries, high employee turnover rates are expected. Gareth Richardson, looks further.
According to latest figures from EEF, staff turnover rates are on the rise - up to 16.1 per cent, the highest level since 2009.
For most companies high employee turnover rates translate into lower productivity, increased costs and workflow disruptions. All of these, of course, have a significant effect on the bottom line and company growth. However, for several industries such as hospitality, banking and finance, tech, sales and healthcare, high employee turnover rates are expected.
But no matter if expected or not, replacing employees, especially if it happens in high numbers and frequently, is expensive, time-consuming and disruptive.
Besides fees to outside recruiters, employers also have to consider the time HR has to invest into selecting and interviewing the right candidates, checking references, testing skills before employment and processing data to add people to payroll.
There are also training costs - the time other employees need to invest to train new staff in the company’s practices and producing various training materials.
Other additional costs most businesses don’t consider during the hiring process are productivity costs - translated into the necessary time employees need until they can perform at full capacity, and opportunity costs which are the lost business opportunities due to lack of sufficient human resources to handle them.
To avoid these costs many companies have ample retention programmes and manage to keep staff churn rates low. But sometimes even with efficient retention programmes employees still choose to change jobs or industries.
Some of the reasons behind these decisions are unstable and long working hours, job stress, retirement, career shifts and many more.
So what could companies with high employee turnover do to keep hiring costs under control and increase the efficiency of their recruitment process?
Technology comes to the rescue
Thankfully technology has made significant leaps in this sector and now there are many smart hiring tools that can reduce recruitment costs and increase the overall performance of the HR department.
Gone are the days when recruitment professionals had to manually sift through hundreds of resumes to find the best talent for their companies. Nowadays, they can simply filter the right candidates in a matter of minutes. Furthermore, smart hiring solutions now provide the opportunity to test an applicant’s skills and expertise online, saving time for both the recruiter and the potential employee.
Another important benefit of hiring tools is reference checking. In a day and age when corporate security is of paramount importance and any breach of confidence with customers comes at a very high cost, companies have to be increasingly focused and check whether each employee is who they say they are.
If done internally, background checks can be time consuming and expensive. But with automated tools this task can become simple and straightforward, saving important resources and ensuring the company’s safety from fraud or security breaches.
In certain sectors, a shortage of skills is a critical challenge, which is why intelligent hiring tools have incorporated personalised video interviews so employers can access a wider talent pool no matter where the candidate’s location is. In this way, decision makers are able to review interviews in their own time and make a fair, unbiased decision.
Doubts and concerns
Despite all these benefits, many recruiting professionals still have concerns regarding technology’s ability to make ‘people decisions’. In reality, smart automated hiring solutions don’t aim to replace recruiters’ intuition and expertise but instead support their work and make them better at what they do.
What would you prefer to do, manually sift through countless irrelevant applications hoping to find the right candidate or use a smart solution that has automated filters and provides feedback during every step of the hiring process? Have countless meetings with applicants who at first glance look good on paper but under closer scrutiny their skills turn out to be nowhere near what you actually need for the role?
Automated hiring tools empower HR professionals to move beyond basic job boards and labour intensive tasks and focus on higher value projects like employee loyalty and engagement.
Employees come and go but competitors and customers wait for no one.
Companies need to deliver maximum efficiency while supplying products or services at attractive prices. Organisations can only do this when they keep their own costs under control, invest in human resources for increased efficiency and encourage agility and change.
Customers are increasingly demanding and market trends shift in the blink of an eye. As a result, companies need flexibility and high-performance employees to keep up with the competition and thrive.
Are you ready for the next generation of hiring technology that will help your company enjoy long-term success?
Gareth Richardson is the Sales Director at Hireabl.