By Josh Weichhand

In previous posts, we’ve discussed how companies that mistreated their employees during the recession may soon see them depart for greener pastures, and we’ve gone over the practical steps employers should take to be sure they retain their best talent during the recovery. As the job market continues to stabilize in the wake of the recession and new opportunities begin to open up elsewhere, it shouldn’t surprise hiring managers that employees may begin to explore their options with other companies. As many companies continue to feel the financial crunch and are forced to stretch every dollar to its limit, hiring managers would do well to consider that the costs of retention, when compared to those of a new hire, aren’t nearly as balanced as one might think. Filling or replacing a position may seem like a simple transaction, but there are numerous unseen costs built into the process. For instance, when an employee quits or is fired, the costs of refilling that position  with a new hire aren’t only limited to providing a base salary, but often include HR and hiring costs, time and money spent on possible outsourcing, any costs associated with training your new employee, and any lost productivity stemming from a loss of morale, or additional workloads.

Here are some things to consider before making a hiring decision:

The costs of hiring may be far greater than you thinkTo put a number in your mind, several studies indicate that the costs associated with replacing an employee are, on average, 150 percent of that position’s annual salary. If that number seems high, the most conservative findings still find those costs hovering near 50 percent. As one resource notes:

[Lose] someone making $30,000 a year because you failed to take adequate steps to keep them and replacing them will likely cost between $45,000 and $60,000. If employees earn $35,000 and you lose a dozen a year, turnover costs approach $250,000 per annum, or more.

Someone amongst your existing staff might want the job you’re hiring for.

If you take the time to speak with your employees about their career goals and their satisfaction with their workload, you may be pleasantly surprised to learn that some of them are ready for their next challenge or opportunity. While it’s completely unacceptable to abuse employees and force them to work outside of their job-descriptions, some of your employees might be thrilled to add an extra bullet to their resume, and you could find yourself in a situation where you’re both maximizing their potential and saving yourself the time and expense of taking on a new hire.

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