It is estimated that it costs roughly 30% of an entry-level hire’s yearly salary to replace them and up to 150% of the annual salary of a mid-level manager. The higher your turnover is, the more it impacts your bottom line. The best way to reduce turnover is to hire the right people in the first place. Here are 5 ways to make better hires in the first place to help reduce turnover.
Be honest about your company culture
If you expect employees to work 80 hour weeks or be on call after work hours, you can find employees that can accept that – but only if you communicate your expectations up front. Conversely, however, if you are not offering a salary and benefits as high as your expectations, you’re going to have a hard time getting recruits to come work for you. You can “fudge” or flat-out lie about what they are walking into, but then you will end up with high turnover. The best thing to do is take a long, hard, honest look at the reality of your corporate culture and make sure you are hiring people that can live with your expectations.
Make sure you are looking for the right people for the job you need them to do
Many companies want to believe that they are looking for an “energetic go-getter” when the manager they will be working for is a micro-manager that doesn’t want anyone making a single decision they haven’t personally signed off on. Make sure the qualities you are looking for in an employee are what you genuinely need, not just what you think you should need.
Use assessment tests
Both resumes and interviews will tell you what a candidate thinks about themselves, but their own personal assessment may or may not be accurate. Checking references can also tell you what others think about the candidate, but their opinion may also be skewed by other factors. Assessments take the personal opinion aspect out of the equation to give you a more realistic picture of a candidate’s actual skill level. A wide range of assessments can also tell you if the candidate is really a good fit for your culture as well as possessing the necessary personality traits for the specific job you are hiring them to do.