Tag Archive for: Hiring Costs

The Many Costs of a Bad Hire

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Any new hire comes with a price tag. You have to spend time and money advertising the position, evaluating job seekers, onboarding the top candidate, and more. Currently, it takes an average of 75 applicants and 16 interviews to secure 1 employee who will stay long-term. With that much time and resourcing going into the recruitment process for each candidate, those prices can really add up.

Many hiring managers assume the risk of making a bad hire is relatively minimal, especially for critical roles that need to be filled quickly. However, the opposite is often true, as a single subpar employee can substantially harm operations, disrupt established teams, and even cost the company customers.

Here are a few ways a bad hire impacts your organization:

1. Recruitment Costs

Recruitment costs associated with a bad hire can quickly accumulate and become a significant financial burden for an organization. At the outset, expenses arise from advertising the job opening on various job boards, which can range from inexpensive postings to premium listings costing hundreds of dollars. This is followed by the time and resources spent conducting phone screens and interviews, often involving multiple team members who must allocate valuable work hours to the process. Once a candidate is selected, onboarding begins, requiring investment in orientation sessions and materials to integrate the new hire into the company culture and workflow. Training expenses further add to the costs, as they encompass both formal training programs and the practical, hands-on guidance provided by colleagues to ensure competence in the role. Should the hire not work out, these investments are rendered fruitless, eventually necessitating further rounds of recruitment to replace the unsuitable candidate.

2. Loss of Business

A bad hire also comes with a price tag, and it’s significantly higher than one may expect. On average, a subpar selection will cost a company at least 30% of the employee’s first-year earnings. Additionally, if they work in sales or another revenue-driving position, there is an additional loss of business. If training funds are spent trying to get the bad hire to the point where they can perform, but the efforts don’t yield results, that’s additional money wasted. And if the person is ultimately fired, then you have to manage recruitment and hiring expenses again to find another candidate.

3. Productivity Cost

When you make a bad hire, your company may experience a productivity drop of approximately 36%. This occurs because the new employee not only fails to meet production standards, they also hinder their team. Often, other employees have to spend their time correcting errors made by the bad hire or simply waiting for the new worker to complete prerequisite tasks. Alternatively, they may have to put some of their own duties aside to cover essential activities the bad hire should be managing on their own. Cumulatively, the situation also damages the team’s morale. They can become frustrated with increased workloads or a bad hire’s performance, a scenario that can lead to falling engagement or even burnout. Hiring a replacement can have a similarly damaging effect, as you will again have to operate short-handed and then wait for a new hire to be brought up to speed. While this productivity dip may be necessary to get the right person in the role, it’s a secondary loss that could be avoided by waiting for an ideal candidate from the beginning.

4. Negative Work Environment

A bad hire can significantly undermine work culture and disrupt team dynamics, leading to a less cohesive and harmonious working environment. When a new employee fails to align with the company’s values or lacks the necessary skills, it can create friction and tension among team members. This discord often results in reduced collaboration and weakened communication, as colleagues may become reluctant to work closely with the problematic hire. Additionally, the presence of a poor-performing individual can lower overall morale, leading to dissatisfaction and disengagement within the team. As employees become increasingly frustrated by the additional workload and stress caused by covering for the underperformer, the once supportive and motivated work atmosphere can quickly deteriorate, impacting both productivity and retention rates as talented team members may choose to seek employment elsewhere.

5. Hinder Brand Reputation

A bad hire can significantly damage a company’s brand reputation, which is crucial both for maintaining current customers and attracting new talent. When an employee lacks the professionalism or competence expected by clients, it often results in a decline in service quality, directly affecting customer satisfaction and loyalty. Clients who experience poor service may choose to take their business elsewhere and can also spread negative reviews, tarnishing the company’s image in the marketplace. Additionally, a reputation for poor hiring choices can deter potential talent from seeking employment with the company, as skilled professionals typically seek workplaces renowned for strong team dynamics and positive work environments. Thus, the repercussions of a bad hire can extend beyond immediate operations, making it difficult to attract both future business and the high-caliber employees needed to drive ongoing success.

Avoiding a Bad Hire

When it comes to avoiding a bad hire, your hiring process is your primary line of defense. Taking the time to create a thorough and effective recruitment strategy can save your organization from potential losses in the long term. Ultimately, prioritizing quality over speed is essential when it comes to recruiting new talent for your organization. If you are looking to streamline your hiring process, Award Staffing can help. Contact us to learn more about our recruitment and hiring services today and see how our expertise can benefit you.

What Can Payroll Services Do For You?

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Payroll is a critical part of any business. When you pay your employees, you are rewarding them for their hard work, dedication, and diligence. However, payroll is also incredibly complex. Calculation errors can significantly harm morale, particularly if they lead your workforce to be underpaid. Plus, keeping up with complicated tax codes and regulations can make handling your own payroll cumbersome, especially for small businesses who can’t afford dedicated payroll staff. Luckily, there is an alternative that can make managing payroll a breeze: payroll services.

A payroll service is a third party that manages payroll processing for their partner businesses. They allow you to outsource your payroll activities, substituting for a traditional in-house payroll staff. The arrangement can provide a range of benefits to companies.

Here are just some of the advantages you will experience:

1. Accuracy

Payroll service providers understand the importance of accuracy. Small missteps in payroll processing can lead to substantial fines, so they work diligently to ensure all the information is correct and that all applicable tax codes and regulations are taken into account. Additionally, they stay up to date in regards to any changes that can affect payroll, such as the passage of new tax laws. Since they are payroll experts, their knowledge base is vast, limiting the likelihood of costly errors.

2. Functionality

Many payroll service providers embrace technology that allows them to offer the highest level of functionality to their partner companies. For example, they are typically equipped to support direct deposit, create management reports, prepare W2 forms, manage standard deductions, and even handle retirement plans for your staff. This means you have access to a range of services that may otherwise be inaccessible to your company if you handled payroll in-house.

3. Convenience

Partnering with a payroll service can free up valuable time, energy, and resources. By outsourcing these responsibilities, you eliminate the need for in-house staff dedicated to payroll processing, which can lead to significant cost savings. This also alleviates the administrative burdens associated with payroll management. Additionally, you can reduce software expenses since these tasks no longer require internal oversight. Overall, outsourcing these tasks allows you to focus on your business’ core competencies which enhances profitability.

4. Security

Payroll records are incredibly sensitive, especially since the information could be used by identity thieves if it is compromised. When you partner with a payroll service, your employee information is typically stored in servers that boast a high level of security, cutting-edge encryption, and backups, ensuring your data is protected from all angles. Often, if you tried to recreate this same level of security in-house, the cost would be astronomical. By selecting a payroll service provider, you gain access to top-notch security features as part of the package.

Your Payrolling Solution

Ultimately, using a payroll service can provide you with a significant number of benefits from cost savings to improved accuracy. If you are looking for a leading payroll service provider, Award Staffing can create a customizable and flexible plan based on your needs. Our payrolling services let you add headcount without managing employment records. Contact one of our experts today to discuss your payroll requirements and see how our services can benefit you.

Why Too Many Job Applicants Hinder Hiring Success

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The current job market is experiencing an unprecedented shift. Many companies find themselves overwhelmed by an influx of job applications, primarily due to widespread layoffs across various industries. This surge in applicants might seem like a positive development at first glance. However, the reality is more complex. With so many candidates to evaluate, hiring managers and HR professionals are spending excessive amounts of time sifting through resumes—many of which do not meet the required qualifications.

This blog aims to explore why having a large number of applicants isn’t necessarily beneficial.

1. The Fallacy of Quantity

Many assume that a high volume of job applicants means more options and a higher likelihood of finding the perfect candidate. Unfortunately, this is a common misconception. When faced with a mountain of resumes, HR professionals may feel a false sense of security. The assumption is that somewhere in that pile lies the ideal candidate. However, sheer numbers often mask the reality that many applicants may not be suitable for the role. This creates a paradox where more options result in less effective decision-making.

In fact, the abundance of applicants can dilute the overall quality of the candidate pool. Instead of focusing on finding the right fit, hiring teams may become bogged down by the sheer volume of resumes to review, increasing the chances of overlooking qualified candidates. So if you’re seeing large quanities of applicants, think about if your job ad is reaching the right people.

2. Quality Over Quantity

Focusing on the right applicants rather than a large pool is essential for effective hiring. Studies show that a well-targeted recruitment strategy often yields better results. For example, LinkedIn’s Global Recruiting Trends report highlights that 78% of recruiters prioritize quality of hire over quantity. Targeting and attracting the right talent ensures that the candidates who apply are more likely to meet the job’s specific requirements.

Additionally, many current applications originate from online job boards that utilize AI to assist job seekers in enhancing their resumes. This can result in exaggerated experiences and skills that may not be trustworthy. While attracting candidates isn’t the issue, the real question is: how many of them are truly qualified? Why squander your time and resources on candidates who don’t meet your standards?

Quality applicants are not just those with the right skills but those who align with your company culture and values. By focusing on quality, you reduce the time spent on interviews and increase the likelihood of making successful hires.

3. The Cost of High Volume

Managing a high volume of applicants comes with hidden costs that can strain your resources. Time is one of the most significant costs. Sifting through hundreds of resumes and cover letters takes hours, detracting from other crucial HR functions.

Moreover, a high volume of applicants could also result in a negative candidate experience. No one has time to follow up with the other 100 candidates who applied to the position. This may result in candidates feeling neglected and lose interest in the position when they don’t receive timely updates or feedback from the company. This can damage your employer brand and make it harder to attract top talent in the future.

Lastly, there’s the financial cost. The longer the hiring process takes, the more expensive it becomes. Time spent on extensive screening and interviews translates to higher operational costs, which can be particularly burdensome for smaller companies.

By focusing on quality over quantity, you can streamline your recruitment process and allocate resources more effectively. This leads to a better overall candidate experience and saves time and money for both the company and candidates involved.

4. Solutions and Best Practices

To counter these challenges, here are some strategies to attract quality applicants and streamline your hiring process:

1. Leverage AI and Automation

Utilize AI-driven tools to filter applications. These tools can quickly identify resumes that match your job criteria, allowing you to focus on the most promising candidates. Automation tools can also streamline the interview process and provide quick feedback to candidates, improving their experience.

2. Define Your Hiring Criteria

Clearly outline the skills, qualifications, and characteristics you’re looking for in a candidate. This prevents unqualified applicants from wasting their time applying for a role they’re not fit for. Additionally, publicizing your criteria can help attract quality candidates who align with your requirements.

3. Utilize Pre-Employment Assessments

Pre-employment assessments are effective tools that can help you identify top-quality candidates early on in the hiring process. These tests evaluate various traits such as cognitive abilities, job-specific skills, and personality. This way, you can identify and focus on the most suitable candidates for further consideration.

3. Optimize Your Recruitment Channels

Focus on platforms where your ideal candidates are most likely to be found. Whether it’s LinkedIn for professional roles or niche job boards for specialized positions, targeted recruitment channels yield better results.

4. Conduct Structured Interviews

Use a structured interview process to ensure consistency and fairness. This approach makes it easier to compare candidates and select the best fit for your needs.

5. Outsource Your Hiring

Work with a local staffing agency to help you identify high quality candidates for your positions. They have access to many networks and can help you find the right fit for your company culture, saving you time and resources.

Partnering Together

At Award Staffing, we recognize the challenges posed by a high influx of candidates. Wasted resources, subpar resumes, and overall poor quality can hinder your hiring process. That’s where we come in. Our advanced behavior screening ensures we only present candidates you can trust.

Our unique method swiftly identifies quality candidates by filtering out those who engage in unsafe behaviors such as theft, violence, substance abuse, excessive drinking, and fraudulent workers’ compensation claims.

Streamline your application process and save valuable time and resources with our behavior screening today. As an extension of your team, we’ll also conduct interviews, start onboarding steps, and even payroll. Reach out to our dedicated Sales team to access quality candidates more efficiently.

Why Payroll Services are Integral to Contract Staffing

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In the dynamic and ever-evolving job market, contract staffing has become a strategic approach to workforce management for many organizations. With the surge in job seeker activity, businesses are inundated with applications, a considerable percentage of which fail to align with their needs and qualifications. This inundation not only strains the recruitment process but also imposes an additional administrative burden on companies. As companies grapple with these inefficiencies, the role of robust payroll services becomes crucial. These services not only streamline salary disbursements for an ever-changing staffing roster but also mitigate the administrative load, allowing businesses to reallocate resources to their core competencies.

Payroll services aids in team management because it enables seamless onboarding, adherence to labor laws, and streamlines human resource tasks. Contrary to a common assumption that outsourced services equate to relinquished control, Payrolling Services actually empower businesses with more refined operational oversight, allowing for strategic redirection of internal resources that might otherwise be tied up in the nitty-gritty of payroll.

1. Reduces Hiring Costs

The hiring process involves various costs at each stage, often unnoticed until they accumulate into a hefty expense. Job board costs, phone screens, and interviews are just the beginning. Onboarding and training new employees are where costs rack up quickly. Onboarding costs include administrative, IT setup, and initial training materials. This not only involves the time to get them up to speed, but also the time of the trainer. In addition, employee turnover is another significant cost for businesses. The investment of time and resources in the hiring, training, and integration of an employee can be futile if they ultimately prove to be incompatible with the company. Payrolling services streamline these processes, mitigating expenses by offering efficient candidate screening, standardized onboarding protocols, and improved employee retention strategies.

2. Scalability with Saving Grace

For HR professionals and business managers, the flexibility of a scalable workforce is not a mere convenience but a strategic necessity. Payrolling Services fulfill this need with expertise, ensuring that as businesses ebb and flow with market vagaries, their workforce dynamics remain agile and aligned with the organization’s overarching goals. These services provide a safety net that businesses can harness to add impromptu talent without increasing their expenses or dealing with administrative tasks.

In particular, Payrolling Services excel at not only reducing the fixed costs associated with permanent hires but also at incorporating the variable expenses in a manner that makes budgeting predictable. They also tender the assurance of compliance with state and federal regulations, assuaging the risk management concerns that arise when dealing with a dynamic workforce.

3. Test Employee Fit Before Hiring

Utilizing payroll services in the recruitment process allows companies to assess potential hires in real-work scenarios, without directly adding to their payroll. This means they can utilize their skills, qualifications, and business value without taking on the burden of hiring or firing. It provides an opportunity for employers to evaluate not only the technical skills but also the cultural fit of the candidates within the team and organization. This can lead to more informed hiring decisions and the integration of employees who are more likely to be satisfied in their roles, committed to the company’s goals, and productive in their contributions over the long term. With no conversion miniums, you can test employee fit as much as you like, and request contractors only when needed.

4. Manages Human Resource Functions

In the realm of payroll services, managing human resources tasks extends far beyond the simple calculation of hours and issuing of paychecks. This comprehensive service eases the administrative load of managing a modern workforce. Payroll services take on essential HR responsibilities, enabling in-house teams to focus on broader strategic goals. These services handle the meticulous process of employee screening, testing, and onboarding, so you can focus on more business acumen. They also manage employee benefits, ensuring that workers fully understand and receive their entitlements. Further, payroll services adeptly tackle the intricacies of unemployment and workers’ compensation claims fortifying an organization’s resilience to employment-related challenges. This allows companies to operate with confidence, knowing that their employees are taken care of and the company’s HR functions are being managed efficiently.

5. Dependable Payroll

At the core of any successful human resources strategy is a dependable payroll system. The efficiency and smooth functioning of payroll processes are paramount to ensure that employees are paid on time and with the utmost accuracy. Engaging a team of payroll experts can offer numerous advantages, critical in the current dynamic work environment. From managing complex payroll taxes on your behalf, offering convenient direct deposit options, to the provision of no-fee paycards, payroll services extend a wide range of benefits. They also manage deductions and garnishments for your employees making it easier for you to maintain compliance and eliminate paperwork. Eliminate unnecessary hassle and ensure your HR strategies are effective with a reliable payroll service.

The Time to Embrace Payrolling Services Is Now

In today’s fast-paced and competitive business landscape, payroll services have proven to be an integral aspect of contract staffing, ensuring businesses stay agile, efficient, and compliant while building a strong workforce that aligns with their goals and values. From mitigating administrative burdens to providing cost-effective solutions, payroll services play a crucial role in helping organizations thrive in a dynamic and ever-evolving job market.

Award Staffing’s payroll services offer an effective solution to mitigate the often hefty costs associated with hiring new employees. As your partner, we’ll help you save on new hire costs including testing, onboarding, insurance, legal, liability, and turnover. Don’t let the burden of hiring costs hinder your progress. Reach out to our team today and discover how our tailored payrolling services can provide the optimal solution that fits your budget and fulfills your staffing needs.