Making the right London hire as costs grow higher
In a recent Live/Work Index compiled by Savills, London was named as the most expensive city to hire someone in the world. For the third year running, the UK capital beat out other popular hubs such as New York, Los Angeles, Sydney and Chicago to take the top spot.
The Index showed that it costs £80,763 for a company to hire one employee in London for a year, compared to the average $56,855 (£39,950) in the 20 cities measured. With such high costs and at a time when employee retention is increasingly difficult, it’s becoming more important than ever to ensure companies are hiring the right employees, who will be in for the long haul.
Likewise, HR departments need to ensure they’re removing poorly performing employees who make good talent leave. Cornerstone OnDemand’s ‘Toxic Employees in the Workplace’ report shows that toxic employees – the employees who won’t help others out, are late all the time, and are consistently unreliable – make their fellow colleagues 54 per cent more likely to quit, and also cost employers up to three times more in hiring fees.
The report found that one toxic employee hire into a team of 20 employees costs approximately $12,800 (£8,200), compared to the $4,000 (£2,600) average expense of hiring a non-toxic employee. So, if a toxic employee joins a team of 20 and ups the turnover by 54%, then the company will lose 10.9% of the team because of that hire. With average replacement costs (including recruitment, hiring and training) at $4,000 (£2,600), the toxic employee therefore adds an extra $8,800 (£5,600) to replacement expenses – and these figures would no doubt be higher than this US average in London.
So how can HR teams feel more assured they’re making the right decision when hiring new staff? Data-driven models can now provide a clear view and custom recommendations for HR professionals’ actions when hiring. While chemistry with the candidate is just as important as numbers and certificates, the more information a recruiter has during the hiring process, the more likely it is that they’ll make the correct choice.
Tools such as Cornerstone Recruiting can ensure recruiting is a core function of the talent management strategy and help HR see the entire talent picture. These tools provide functions such as talent pools, assessments, search functionality, and branded career sites, and can also help track important metrics with reports and dashboards.
For more information visit https://www.cornerstoneondemand.co.uk/recruiting