Losing an employee hurts any company, and a slow hiring process to fill that vacant role will cost you more in the long run. Generally, an open role costs an organization between $1,000 and $5,000 to fill. The Great Resignation and the current talent shortage make these costs expand for employers everywhere. Finding ways to shorten your time-to-hire is the best way to keep your organization from hemorrhaging money without knowing it.
We dove into the research to share the primary reasons why it’s critical to fix your slow time-to-hire.
You’re Missing Out On Top Talent
Time-to-hire is the gap between a recruiter contacting a potential candidate and a candidate accepting the open position. This gap of time is continuously increasing over the last few years. Glassdoor reports that between 2010 and 2015, the average time-to-hire increased by 10 days. This increase in time is attributed to a heightened focus on the screening process to secure better employees. In actuality, a longer screening process doesn’t mean you will bring in better talent. It actually means that you will likely miss out on the best candidates.
Glassdoor provided even more insight on the length of time-to-hire when they found the average interview process took 23.7 days. While this number already seems high, LinkedIn found that open marketing and management positions took a median of 40-41 days to fill. Even the shortest time-to-hire jobs, such as customer service and administrative fields, had a median time of 33-34 days. While long hiring processes are the norm, companies need to shorten their hiring timeline to stay competitive in the job market and attract top talent.
The Job Market is More Competitive
With the onset of The Great Resignation, candidates are raising their expectations for their potential employers. As NPR said, “As pandemic life recedes in the U.S., people are leaving their jobs in search of more money, more flexibility, and more happiness. Many are rethinking what work means to them, how they are valued, and how they spend their time.”
Candidates are putting more value in a positive workplace environment, higher pay, and a quick and communicative time-to-hire process. Employers and recruiters feel this competitiveness, as 86% of recruiters and 62% of employers see the labor market shifting to candidate-driven. LinkedIn has even dubbed this shift the “Golden Age of Talent Acquisition.”
This competitive job market has led to a noticeable “talent shortage” for some sectors, with the service and factory industries facing exceptionally large amounts of turnover.
To fill in this shortage and find top talent, businesses will need to prioritize their thoughtfulness and flexibility in their hiring practices. However, this prioritization should not translate into extending your time-to-hire. The most qualified candidates are only available for around 10 days before committing to another position.
You’re Losing Money
An unfilled role impacts morale and costs your organization money every day it sits empty. The cost of employee vacancy will differ with each position in the organization.
According to Dice Insights, to find out how much revenue you are losing every day that a position sits empty: take the number of your annual profits and divide it by your number of employees. Then divide that number by working days within a year (220), and multiply by the average days your time-to-hire lasts. This formula is the easiest way to calculate the revenue lost from a single vacant position.
💡 (Annual Profits / # of employees) / 220 working days in a year X average days to hire.
Employee vacancies are detrimental to a company’s finances and the productivity of the team as a whole. Talent deficiencies affect about 40% of strategy implementation efforts. A reduction in productivity can bring a slew of new costs and complications the longer it takes to hire a candidate.
Get a jump start on improving your time-to-hire to make sure you don’t miss out on top talent, ensure you stay competitive in the job market, and aren't throwing money out the window with vacant positions.
Though you might want to take time to deliberate on the perfect candidate, lengthening your hiring process rarely helps improve the quality of your chosen candidates. By implementing asynchronous audio-based interviews with Qualifi, not only will you speed up your hiring process, but you will also improve internal alignment, and mitigate bias in the process while having the utmost confidence in every single candidate you choose.