{"id":12158,"date":"2020-07-22T08:18:44","date_gmt":"2020-07-22T08:18:44","guid":{"rendered":"https:\/\/dna325.com\/blog\/?p=12158"},"modified":"2021-11-19T13:33:19","modified_gmt":"2021-11-19T13:33:19","slug":"hidden-costs-why-it-recruitment-is-so-expensive","status":"publish","type":"post","link":"https:\/\/dna325.com\/blog\/hidden-costs-why-it-recruitment-is-so-expensive\/","title":{"rendered":"Hidden Costs: Why IT Recruitment Is So Expensive"},"content":{"rendered":"\n<h3>When there is a need for new employees, the company inevitably faces a choice to pick the right strategy for recruitment:<\/h3>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">hire a recruiter onsite if there isn\u2019t one, or if the existing one can\u2019t cope with the volumes;<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">contact a recruiting agency or a freelancer;<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">a hiring manager looks for people himself, which in itself is not an option since it takes a lot of time.<\/span><\/li>\n<\/ul>\n<p><img decoding=\"async\" class=\"alignnone wp-image-12181 size-large\" src=\"https:\/\/dna325.com\/blog\/wp-content\/themes\/reco\/assets\/images\/transparent.gif\" data-lazy=\"true\" data-src=\"https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-27-1-1024x576.png\" alt=\"Chart What type of recruitment do you use?\" width=\"1024\" height=\"576\" data-srcset=\"https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-27-1-1024x576.png 1024w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-27-1-300x169.png 300w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-27-1-768x432.png 768w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-27-1-1536x864.png 1536w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-27-1-100x56.png 100w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-27-1-700x394.png 700w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-27-1-1600x900.png 1600w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-27-1.png 1920w\" data-sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/p>\n<p><span style=\"font-weight: 400;\">Most companies underrate the cost of recruitment by 90-95% not least when they are looking to cut costs, this often leads to horrific decisions that not only fail to reduce costs but might drive them up. So what are these costs, and more importantly, what can you do about them? But, firstly, <\/span><span style=\"font-weight: 400;\">what is the cost of a bad hire?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In a <\/span><a href=\"https:\/\/theharrispoll.com\/\"><span style=\"font-weight: 400;\">Harris Interactive poll<\/span><\/a><span style=\"font-weight: 400;\">, 41% of respondents said that the cost of a bad hire was greater than $25000, and 25% of respondents said that the cost was greater than $50000.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">It is worth noting that the hiring costs associated with recruiting a productive employee are much less than the cost and overall impact of bad hiring. If a new employee is not suitable and leaves after a short period, then the company may have several additional costs, including the costs of selecting and training a replacement, as well as the loss of time.<\/span><\/p>\n<h2>\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0What makes up hiring costs?<\/h2>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Recruiter salary and benefits<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Advertising agency fees<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Signing bonuses<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Travel expenses for applicants and staff<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Employee referral bonuses<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Third-party recruiter fees<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Employee relocation costs (for certain high-level jobs)<\/span><\/li>\n<\/ul>\n<h3><span style=\"font-weight: 400;\">For external recruitment\u00a0<\/span><\/h3>\n<p><img decoding=\"async\" class=\"alignnone wp-image-12169 size-large\" src=\"https:\/\/dna325.com\/blog\/wp-content\/themes\/reco\/assets\/images\/transparent.gif\" data-lazy=\"true\" data-src=\"https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-28-1-1024x576.png\" alt=\"Chart What payment options are appropriate for you?\" width=\"1024\" height=\"576\" data-srcset=\"https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-28-1-1024x576.png 1024w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-28-1-300x169.png 300w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-28-1-768x432.png 768w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-28-1-1536x864.png 1536w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-28-1-100x56.png 100w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-28-1-700x394.png 700w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-28-1-1600x900.png 1600w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-28-1.png 1920w\" data-sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/p>\n<h3><span style=\"font-weight: 400;\">For onsite recruitment\u00a0<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Sums most people say when they are discussing hiring costs is the external expenditure on recruitment. In companies that rely on recruitment agencies, this is typically 15-30% of salary. Among other costs advertising, subscription to database aggregators and job boards, and the fee of in-house recruiters. Many organizations attempt to minimize their recruiting costs by having recruitment in-house and cutting out the agencies.\u00a0<\/span><\/p>\n<p><img decoding=\"async\" class=\"alignnone wp-image-12170 size-large\" src=\"https:\/\/dna325.com\/blog\/wp-content\/themes\/reco\/assets\/images\/transparent.gif\" data-lazy=\"true\" data-src=\"https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-29-1024x576.png\" alt=\"Chart How do you pay onsite recruiters?\" width=\"1024\" height=\"576\" data-srcset=\"https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-29-1024x576.png 1024w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-29-300x169.png 300w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-29-768x432.png 768w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-29-1536x864.png 1536w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-29-100x56.png 100w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-29-700x394.png 700w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-29-1600x900.png 1600w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-29.png 1920w\" data-sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/p>\n<p><span style=\"font-weight: 400;\">As a consequence they often deliver 8-15% costs in comparison to salaries, this is often less of a saving than they hoped for, but still. Nevertheless, it should be noted that over 70% of in-house solutions fall short to source all, or even 90% of their openings themselves and hence require agencies\u2019 help, increasing that normal price to 12-20%.\u00a0<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Cost of IT recruitment: job board fees<\/span><\/h3>\n<p><img decoding=\"async\" class=\"alignnone wp-image-12172 size-large\" src=\"https:\/\/dna325.com\/blog\/wp-content\/themes\/reco\/assets\/images\/transparent.gif\" data-lazy=\"true\" data-src=\"https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-30-1024x576.png\" alt=\"Chart Do you use paid job posting?\" width=\"1024\" height=\"576\" data-srcset=\"https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-30-1024x576.png 1024w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-30-300x169.png 300w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-30-768x432.png 768w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-30-1536x864.png 1536w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-30-100x56.png 100w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-30-700x394.png 700w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-30-1600x900.png 1600w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-30.png 1920w\" data-sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/p>\n<p><img decoding=\"async\" class=\"alignnone wp-image-12183 size-large\" src=\"https:\/\/dna325.com\/blog\/wp-content\/themes\/reco\/assets\/images\/transparent.gif\" data-lazy=\"true\" data-src=\"https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-31-1-1024x576.png\" alt=\"Chart How much do you spend on job promotions?\" width=\"1024\" height=\"576\" data-srcset=\"https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-31-1-1024x576.png 1024w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-31-1-300x169.png 300w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-31-1-768x432.png 768w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-31-1-1536x864.png 1536w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-31-1-100x56.png 100w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-31-1-700x394.png 700w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-31-1-1600x900.png 1600w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-31-1.png 1920w\" data-sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/p>\n<p>&nbsp;<\/p>\n<p><img decoding=\"async\" class=\"alignnone wp-image-12173 size-large\" src=\"https:\/\/dna325.com\/blog\/wp-content\/themes\/reco\/assets\/images\/transparent.gif\" data-lazy=\"true\" data-src=\"https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-34-1024x576.png\" alt=\"Chart Do you have own career page?\" width=\"1024\" height=\"576\" data-srcset=\"https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-34-1024x576.png 1024w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-34-300x169.png 300w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-34-768x432.png 768w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-34-1536x864.png 1536w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-34-100x56.png 100w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-34-700x394.png 700w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-34-1600x900.png 1600w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-34.png 1920w\" data-sizes=\"(max-width: 1024px) 100vw, 1024px\" \/> <img decoding=\"async\" class=\"alignnone wp-image-12174 size-large\" src=\"https:\/\/dna325.com\/blog\/wp-content\/themes\/reco\/assets\/images\/transparent.gif\" data-lazy=\"true\" data-src=\"https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-33-1024x576.png\" alt=\"Chart Most Used jobboards\" width=\"1024\" height=\"576\" data-srcset=\"https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-33-1024x576.png 1024w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-33-300x169.png 300w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-33-768x432.png 768w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-33-1536x864.png 1536w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-33-100x56.png 100w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-33-700x394.png 700w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-33-1600x900.png 1600w, https:\/\/dna325.com\/blog\/wp-content\/uploads\/2020\/07\/Charts-Slide-33.png 1920w\" data-sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/p>\n<h3>Agencies use two schemes<\/h3>\n<ol>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">They take a fixed percentage (from 12 to 18%) of the annual salary;<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">They have a fixed price for a certain position<\/span><\/li>\n<\/ol>\n<p><span style=\"font-weight: 400;\">We use the second approach and believe it to be more client-oriented. When we don\u2019t have any personal interest in candidates\u2019 salary, we can do recruiting more transparently. Check out our pricing <\/span><a href=\"https:\/\/dna325.com\/recruitment.html\"><span style=\"font-weight: 400;\">here.<\/span><\/a><\/p>\n<h2>When to hire an agency?<\/h2>\n<p><span style=\"font-weight: 400;\">When a company lacks recognition in the IT job market, lower recruiting costs usually translate into more time to attract the best talent, both in the early stages of the search and in the long term. Add in the blunders of low-skilled recruiters, and you will need to allocate additional budget to form an employer branding strategy from scratch.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">For Middle+ positions, recruiting agencies like <\/span><a href=\"https:\/\/bit.ly\/2DV6D4x\"><span style=\"font-weight: 400;\">DNA325<\/span><\/a><span style=\"font-weight: 400;\"> have a bigger candidate pipeline. This speeds up the hiring process: professional candidates can conduct more interviews and single out people more suitable for job descriptions the company provides. When a company has reactive scaling, and onsite recruiters can\u2019t keep up the pace and you need to find a lot of skilled specialists quickly, it is better to have a pool of right candidates, who can be interviewed fast.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>When there is a need for new employees, the company inevitably faces a choice to pick the right strategy for recruitment: hire a recruiter onsite&#8230;<\/p>\n","protected":false},"author":14,"featured_media":12176,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[101,155],"tags":[],"class_list":["post-12158","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-hr","category-research"],"_links":{"self":[{"href":"https:\/\/dna325.com\/blog\/wp-json\/wp\/v2\/posts\/12158","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dna325.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dna325.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dna325.com\/blog\/wp-json\/wp\/v2\/users\/14"}],"replies":[{"embeddable":true,"href":"https:\/\/dna325.com\/blog\/wp-json\/wp\/v2\/comments?post=12158"}],"version-history":[{"count":8,"href":"https:\/\/dna325.com\/blog\/wp-json\/wp\/v2\/posts\/12158\/revisions"}],"predecessor-version":[{"id":12818,"href":"https:\/\/dna325.com\/blog\/wp-json\/wp\/v2\/posts\/12158\/revisions\/12818"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/dna325.com\/blog\/wp-json\/wp\/v2\/media\/12176"}],"wp:attachment":[{"href":"https:\/\/dna325.com\/blog\/wp-json\/wp\/v2\/media?parent=12158"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dna325.com\/blog\/wp-json\/wp\/v2\/categories?post=12158"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dna325.com\/blog\/wp-json\/wp\/v2\/tags?post=12158"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}