09 Oct 2017

The impact of losing staff and how employee benefits can help

Employers know that losing experienced staff can be a big drain on a business, but it is difficult to put a firm figure against this impact. It is possible, however, to identify the likely costs that a business needs to take into account when trying to calculate the impact of replacing a staff member when they leave.

What is the impact of losing staff?

The costs will vary by industry sector, the size of the business and the background of the worker being recruited in terms of their skills and experience. There are a number of typical costs either through direct spend or management time that a business may incur. These can include:

Hiring temporary workers before a replacement starts or paying overtime to other employees to get jobs done
Management time spent organising getting a replacement, this can include interviewing candidates
Recruitment agency fees
Advertising the role
Time spent by HR or management processing the replacement and any induction costs

A major cost implication for firms replacing staff is the lost output that a company experiences during the period of time that the new worker needs to get up to speed with the role and how it is carried out in the new business. This time and the cost incurred as a result can fluctuate depending on the size and the approach of the business.

Other key costs include the logistical costs of replacing an employee, which incorporates expenditure such as advertising costs and agency fees, as well as invested time such as interviewing prospective candidates.

What can companies do to keep staff?

While the logistical costs of replacing an employee will probably come as no surprise to businesses, the financial impact of having replacement workers learn the ropes both in terms of the job itself but more importantly about how the business functions in practice, are probably costs that businesses have not considered.

Whatever the costs, there's no doubt that retaining employees is often a much more cost-effective solution than replacing them. There has been a growing trend for businesses to look at providing a range of simple, affordable additional staff benefits for their employees to not only retain staff, but also to help attract better talent and cultivate more loyalty and productivity among their staff.

It should be remembered that many benefits are simple to introduce, and at worst, cost no more a month than employers may currently spend providing tea and coffee.

This article was provided by Busy Bees Benefits.