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Callum Tomlinson

Doing Your Recruitment Internally? This Is How Much It Is Costing You

Blog Post Tempate

​Recruitment is one of the most important tasks that any business must undertake, ensuring that your organisation has access to the skills and personnel needed to grow and thrive. As such, this function requires the right amount of investment to ensure that your hiring activities are delivering the necessary results.

However, it is not as simple as saying that recruitment spending and success can be directly linked. For many companies that handle their hiring internally, their recruitment process can often end up costing much more than they had planned or accounted for, without necessarily creating the outcomes that they seek.

In this blog, we will look at how much internal recruitment can cost a business, the reasons why these expenses are incurred, and the potential cost-effectiveness benefits that working with an external agency can deliver.

According to a 2020 analysis from Glassdoor, the average cost per hire for employers was around £3,000, with companies taking around 27.5 days on average to bring a single new employee in. Meanwhile, a similar analysis from XpertHR suggested that the average recruiting cost was just over £2,000.

Naturally, however, an accurate estimate of the true cost of internal recruitment will require a case-by-case analysis of the relevant facts and figures. The total figure will depend on the cumulative costs of each stage of the recruitment process, as well as how long it ends up taking to find the right candidates - a period of time that is likely to be much longer for higher-level directorial roles, or placements in highly specialised sectors.

To find out the total cost of your internal recruitment, you will need to take the following factors into account:

●      Time spent creating job descriptions and listings.

●      The cost of displaying job adverts on external sites.

●      Time spent communicating and liaising with potential candidates.

●      Organising different stages of the interview process.

●      Time spent reviewing CVs and completing paperwork.

●      The cost of onboarding new staff members.

●      Salaries paid to internal recruitment teams.

●      Referral rewards paid to employees who recommend a candidate.

●      Licensing costs for any commercial software used in your recruitment.

This is a non-exhaustive list, and the number of different potential costs involved in the recruitment process can quickly add up to create considerable expense.

On top of the inherent cost of organising a recruitment process, internal hiring activities can become even more expensive due to several issues that can arise during this process:

●      Businesses without specialist recruitment knowledge may encounter inefficiencies in their hiring process, resulting in unnecessary bureaucracy and delays that lead to a more protracted time to hire. This causes unnecessary waste over time.

●      Businesses with inefficient internal hiring processes may struggle to fill vacancies for a longer period, leaving them without access to crucial skills during this time and impacting their operational effectiveness.

●      If the company does not have a dedicated recruitment team, these responsibilities will need to be handled by another member of the leadership team in addition to their existing role, splitting their focus and creating inefficiencies.

●      Inefficient recruitment could lead to the company taking on a candidate who proves to be a poor fit for the role, meaning they will not last long in the role. This means the recruitment process will need to be restarted from scratch, creating significant additional costs.

These risks can add up in a way that makes internal recruitment an unsustainable approach for many companies. In these cases, it may be better fo your business to rely on the expertise and dedicated service offered by an external recruitment agency. These companies are highly experienced in efficiently delivering high-quality candidates for businesses, and are thus able to avoid many of the pitfalls facing organisations without this expertise.

Although the upfront costs of hiring an external recruitment partner can be higher than handling this internally, over time this can deliver a better return on investment, and ensure that the company has easier access to the high-quality talent they need

Businesses that wish to avoid these potential costs and downsides of handling their own hiring would be best advised to work closely with a specialist recruitment agency with experience in supporting companies with recruitment in their chosen sector.

As a specialist engineering and manufacturing recruitment firm, Employment Solutions is able to deliver this. We have been helping businesses in these sectors with their recruitment for more than two decades and can provide tailored advice and hiring solutions to ensure that you are able to find the right candidates quickly, freeing up your team’s time to focus on your core operations.

To learn more about how Employment Solutions can help to make your recruitment more efficient and cost-effective, call us on 0161 839 5353