After the tumultuous events of the past year, many employers are reviewing their budgets and have begun to advertise open positions that may have been eliminated during the pandemic. But even with the economy rallying and a positive outlook on the year ahead, the expense of filling these positions can be significant and represent a financial challenge to companies still struggling to recover from lost revenue.
The cost to replace a salaried employee is, on average, between six and nine months’ of that employee’s salary. For an employee earning $60,000 per year, that means it will cost approximately $30,000 to $45,000 to recruit and train a replacement. Other studies have estimated that this figure is much higher, possibly as much as twice the employee’s annual salary if the employee in question was a high-earner or at the executive level.
Beyond the financial cost to replace an employee, there are less tangible costs associated with high employee turnover, including lost productivity as new employees get up to speed and lower employee morale for those who remain at work and may struggle to adapt to the revolving roles of new associates or supervisors.
There is an alternative solution, one that not only enables employers to cut down on turnover costs, but also helps to bring qualified individuals back to work: rehiring former employees. Thousands of individuals have been forced to put their careers on hold while they deal with a life-threatening health complication.
For those diagnosed with serious illnesses or chronic conditions, such as cancer, cardiovascular disease or osteoarthritis to name a few, treatments and doctor’s appointments can dominate their schedules, forcing many out of the workforce for months or even years. In many cases, these individuals eventually recover, and when they do, they are often eager to resume their work routine and supporting their households.
Before beginning the recruitment process, companies should start by looking within their own pool of former employees, some of whom may have left because of health complications. Reaching out to these former employees and showing compassion for the personal circumstances that forced them to leave the workforce is a first step towards bringing back valuable talent.
Some employers will even modify positions for valuable employees, as long as they have recovered enough to return to their former position.
Another existing program that provides individuals with former experience for open positions is the Ticket to Work(TTW) program. This program is designed to support employees in their return to work, whether through former or new employers. These qualified applicants come from across an array of industries. Many of these individuals have significant work experience from their previous positions and may require minimal employee-sponsored training.
Aside from the cost effectiveness of hiring former workers to fill open positions, there are significant benefits to cultivating a diverse workforce that encompasses people of all backgrounds and experiences. A study by the Wall Street Journal found that having a diverse and inclusive workforce gives companies an edge over their competitors and that having a range of perspectives often leads to greater innovation and creativity. Diverse teams also saw a 60% improvement in effective decision-making. Increased diversity can also lead to higher revenue and a happier workforce, which benefits employers and employees alike.
The economic recovery following the pandemic will provide an opportunity for employers and former workers, who are likely more closely evaluating their options in a post-COVID-19 environment. Individuals with medical conditions that forced them to leave the workforce may have recovered enough over the past year to return to work, especially as the widening vaccination campaign has increased the number of people who feel safe reentering the office. The benefits, financial and otherwise, of bringing former employees back to work is clear, making this the perfect time for employers to increase their workforce while decreasing their recruiting and hiring costs.
Read More:How To Avoid High Turnover Costs By Bringing Former Employees Back To Work