How much does the departure of an employee really cost, i.e. how long does it take to acquire and implement a developer.
At first glance, it might seem that finding a new employee in place of the old one is the cost of advertising in the media, several dozen hours of recruitment and initial training of a new employee of our IT department. Nothing could be more wrong. Read today's post and estimate the real cost of losing a developer.
15th February 2022
The departure of a new person after a three-month trial period is the average cost of PLN 91,896 in the economy - experts from Sedlak & Sedlak and PWC calculated. Another 9 months are needed to implement another employee. These are not only salaries paid, but also expenses related to recruitment, administrative costs and medical examinations. Costs also include financial expenses related to the organization of a new job, training and the implementation process. In addition, one should take into account the costs of overtime for people who will introduce and support a new - still dependent - employee at work. A significant loss will also be the loss of business benefits, which results, inter alia, from due to the lack of continuity in a given position. The costs of leaving and hiring a new IT employee should be considered from two sides: ✅ How much does it cost us to leave an employee (yes, yes, it's not only the notice costs :) ✅ How much does it cost and takes to hire and implement a new IT department employee (provided that he or she does not leave us after the first 2-3 months of work, because, as we mentioned in the introduction, then the costs are skyrocketing). How much does an IT specialist leave the company in real terms? It's hard to believe, but leaving the company is extremely costly and time-consuming. It goes much further than the period of notice (and the cost of such termination and possible severance pay). It requires the involvement of many people. In addition, the performance of the employee who leaves us in a month's time drops during the notice period - he or she does not have the same motivation and commitment as before. But it doesn't stop there. We still bear the costs of the administrative procedure (approximately 4 hours of work). The biggest cost, however, is the handing over of responsibilities. In addition to the drop in productivity, the leaving employee must pass his current projects on to his successor (if any). This consumes a lot of time for both employees. Another cost we incur is the cost of replacement, because overtime and additional work are required during this period by our employees to fulfill the tasks of the employee who left the company. Now let's move on to the cost of finding and hiring a new employee. What costs are we talking about? ▶ costs of recruitment: working time of the HR department, costs of advertisements in IT portals, costs of campaigns in the media ▶ costs of starting a workstation, purchase of appropriate hardware and software, licenses ▶ administrative costs - HR implementation and occupational medicine All of these costs vary depending on the size, experience and level of organizational culture within our company. We went through the recruitment process. This is the end of the costs? It might seem that finding and employing a great programmer is already a success. Now it will be downhill. Unfortunately, this stage is the most expensive of all. After being hired, the most difficult and most important task is ahead of us - the implementation of a new employee (the so-called "onboarding"). Effective onboarding is a real success, the effects of which will be felt in further cooperation with a new employee of the IT department. The costs of implementing an employee should be treated as part of the recruitment costs, precisely because onboarding affects the quality of the programmer's future work. Why are these high costs? The new employee will be less efficient throughout the implementation period, as he or she does not yet know the company's processes and at what stage all projects are at. Moreover, it will not implement itself - this process will consume other employees' time, which will also reduce their efficiency. Searching for a talented employee in the IT industry. Interest in a developer career continues to grow, but that doesn't mean finding a great developer is easier. On the contrary. The time to acquire real talent increases. Additionally, the IT market shows a higher employee turnover than in other industries. This is mainly due to the rapid development of programmers and constant improvement. Many companies find it difficult to find competent, qualified programmers. Completing an IT team that would match our needs and business goals is becoming more and more difficult and requires more and more time. However, it is worth remembering that long recruitment, with many stages, can potentially harm us. After all, candidates must be kept in the process. The longer and more complicated the recruitment, the greater the risk that candidates will resign. It is therefore important to develop a recruitment process that will allow us to assess all the necessary skills and competences that a programmer should have. At the same time, it must be so effective that we will not lose interest and commitment of the candidates. Finding a balance between the two is difficult and requires experience. So how much does it really cost an employee to leave? The simplest answer to this question is: a lot. The departure of an employee, finding and employment, and then the implementation of a new employee is an unexpectedly high cost and time-consuming.
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