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Can you tell me the average cost of hiring an employee?

I am looking for the average cost of hiring an employee in order to show my field the risk of turnover or incorrect hires.

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While the cost of hiring an employee (or replacing a lost employee) can vary, there are some decent studies that indicate a general range. For example, The Society of Human Resource Management indicates that a cost per hire range for a single employee can be as much as $4,129 and this includes recruitment as well as training expenses. (https://www.shrm.org/about-shrm/press-room/press-releases/pages/human-capital-benchmarking-report.aspx). However, the cost to replace an employee may be higher, ranging from 50% to 150% of an annual salary for the departing entry level to mid-level employee due to lost productivity, to as much as 400% of the annual salary for a specialist or executive level employee. (https://www.eremedia.com/tlnt/what-was-leadership-thinking-the-shockingly-high-cost-of-employee-turnover/) A bad hire can be much more costly because it poses a risk to the business, as well as potential long-term legal fees.

Apart from the regular cost incurred in the hiring process, there is an opportunity cost of the person who is leaving or left the organization. Roughly, I would think taking into the consideration of the investment by the company in developing the existing staff, the tacit knowledge of the staff and their CTC, the retraining cost of the new hire, new hire cost could be 10 times more costly than the resigning staff.

Anonymous User

It depends on the industry, job, and experience.


Depends on the type of employee that you are going to hire. If you want to hire someone who is going to work for you as a part-time that simply means less pay. But if you want to hire for an important role, the cost is higher. Let's assume for example that you are hiring a manager so that means you are hiring someone for a great role and to manage other people. You need to pay him/her better and the cost simply is up but remember don't put it too high to make the employee feel that he/she is needed and he can't be replaced. All depends on the turnover, and what he/she is going to produce and give you.

Thank you,
Akmal Yousuf, CEO

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