Organisations are reportedly losing substantial sums due to inefficient recruitment and retention processes.
- Recent data suggests that most organisations fail to measure return on investment in their hiring activities.
- A significant number of companies do not calculate the cost associated with employee turnover.
- Rising recruitment budgets may worsen financial losses amid ongoing skills shortages.
- Understanding and addressing inefficiencies in the hiring process is crucial for optimising resources.
Organisations are reportedly losing substantial sums due to inefficient recruitment and retention processes. New data from Omni RMS in collaboration with the CIPD highlights this troubling trend. The study emphasises that many companies are failing to realise measurable returns on their investment in hiring activities, which results in excessive financial outlays without tangible benefits.
Recent data suggests that most organisations fail to measure return on investment in their hiring activities. Based on findings from the Resourcing and Talent Planning report, only a quarter of companies assess the return on their hiring investments. This oversight has significant financial consequences, considering the ongoing investment in recruitment due to skills shortages.
A significant number of companies do not calculate the cost associated with employee turnover. Despite being aware of turnover statistics, less than a third of organisations compute the financial impact of staff departures. With turnover rates averaging 34%, businesses may face substantial costs linked to hiring and replacement efforts.
Rising recruitment budgets may worsen financial losses amid ongoing skills shortages. Amidst the challenges posed by skills shortages, 32% of private sector companies plan to expand their recruitment budgets this year or next. This approach, however, could inadvertently amplify the issue by not addressing the root causes of high turnover rates.
Understanding and addressing inefficiencies in the hiring process is crucial for optimising resources. As highlighted by Louise Shaw, Managing Director at Omni RMS, tracking recruitment effectiveness is vital. Companies need to identify inefficiencies in attraction, selection, or onboarding processes, which requires skills beyond traditional metrics. The failure to do so can lead to increased pressure on budgets and affect business performance.
Addressing inefficiencies in hiring and retention is essential for financial stability and optimised resource allocation.
