Hiring the right employees is expensive, and hiring the wrong people is even more expensive. The key to success, especially in the supply chain where talent is particularly tight, is to find and keep the right people.
Nearly half of companies say attracting and retaining employees is their top challenge in 2018, according to the annual Business Pulse Survey by SunTrust Banks. Small and mid-sized businesses cite employee morale (59%), a shortage of skilled labor (54%) and higher than average turnover (53%) as factors that could impact their businesses' financial performance this year.
“With domestic unemployment continuing to hover just above four percent, one of the lowest levels in a decade, many companies feel they are at a critical point competing for talent,” said Jason Cagle, head of Commercial Banking at SunTrust. “Businesses are looking at all opportunities to attract and retain employees from offering new benefits to sharing tax reform proceeds. Less obvious is the role M&A can play to help secure a skilled workforce. This has become increasingly important as we advise our clients.”
The image below highlights other survey findings.
Bad hires are a big problem. Three in four employers have hired the wrong person, according to a recent CareerBuilder survey. That kind of mistake is costly—with companies losing an every of $14,900 on every bad hire. Employers said that choosing the wrong people resulted in a lot of challenges including reduced productivity, the opportunity cost of not being able to recruit and train other workers, and lower work quality.
“It's important to note that there's a ripple affect with bad hires. Disengagement is contagious — poor performers lower the bar for other workers on their teams, and their bad habits spread throughout the organization,” said Rosemary Haefner, chief human resources officer at CareerBuilder. “The best thing hiring managers can do is put in the time and effort on the front end to make sure they have the best available pool of applicants for every job opening. And, just as importantly, have good procedures in place for evaluating candidates.”
Losing great workers, though, is an even more costly problem. The average cost of losing a good hire was $29,600 last year, CareerBuilder found. While three quarters of employees report that they are loyal to their employer, just a little more than half think their employer is loyal to them.
Take a look at the infographic at the bottom of this page to explore other survey findings and learn about common mistakes and how to avoid them. What are you doing to retain your best talent? Let us know in the comments section below.
— Hailey Lynne McKeefry, Editor in Chief, EBN