Employers across the country are all after top talent. In fact, in March 2023, 45% of HR leaders reported staffing and recruiting were among the top goals for their organization for 2023. But recruiting and hiring top talent isn’t as easy—or cost-effective—as you may think. It’s important to fully understand how long and expensive it is to recruit top talent in today’s market so you can set realistic expectations and best inform your strategy. Let’s dive in and get started.
The Time Investment of Recruiting Top Talent
One of the most important metrics in the HR world involves the “time to fill” a position, which is the time it takes to hire a candidate from when the position opens to when an offer letter is signed. Although hiring managers aim to fill any open positions as quickly as possible, the average time to hire in recent months has slowed to an average of 60 days—and can even be up to four-to-six months to fill a role. Factors that can draw out a company’s average time to hire include finding top talent, particularly for higher-level positions.
In a time when budgets are tight, and the search for top talent is competitive, it’s important to understand the true time investment that goes into recruiting top talent so that you can set realistic expectations and revise your strategy to streamline the process.
Although every company is different, listed below are the general steps involved with recruitment.
Step 1: Planning and Strategy
Often, the first step of the recruitment process involves planning. At this part of the process, the hiring manager, HR, or a staffing firm will meet to discuss the open position. Things to be discussed here include the ideal candidate, compensation range, and desired skills. This part of the process can be lengthy if not everyone is on the same page—particularly if you’re not up to speed on market conditions and pay bands.
However, skipping this step or rushing through it can lead to further delays down the road, so it’s best to focus on planning your recruitment for an open position.
Step 2: Active Recruitment
From the time the job requisition is open, it’s time to search for candidates actively. This step is perhaps the most unique and varies in time for completion. In this part of the process, candidates are screened and interviewed. Depending on the job, there may need to be extensive and multiple rounds of interviews to vet a candidate properly. For example, filling an executive or managerial position could take up to 120 days.
Step 3: Hiring a Candidate
A job offer can be extended once a company has selected the ideal candidate. If the candidate accepts, then the position is considered filled. However, that’s not the end of the time cost regarding recruitment. Onboarding a new hire can be a lengthy and expensive process. The length of time an employee must be onboarded will vary by employer but generally lasts up to three months. It could be shorter or longer, depending on the nature of the business’s operations and the scope of the role.
As you can see, the time investment that goes into the recruitment process is not minimal. And, of course, a time investment is compounded by a monetary investment, as well, which is something that should be fully understood.
The Monetary Investment of Recruiting Top Talent
It’s often a significant investment to recruit and hire top talent. Many facets go into determining the overall cost of recruiting top talent, but some include the costs of a vacancy itself, the recruitment investment (e.g., marketing, recruiting staffing, and potential travel costs), and compensation demands, to name a few.
Costs of Open Positions
While it may seem like leaving a position open only affects the company’s bottom line in terms of dollars not being spent paying an employee in that role, that’s simply untrue. A company loses a significant amount of money every day a role remains vacant in terms of lost productivity, and as employees are asked to take on a vacant position’s duties, employers run the risk of additional employee turnover.
Costs of Recruiting
The average recruitment cost per hire can be great. According to the Society for Human Resource Management benchmarking data, it can cost $4,683 per hire and $28,329 per executive hire, on average. Factors that play into the overall costs of recruitment include:
- Advertising the position (as job boards generally charge per posting)
- Travel costs if you’re flying in candidates for interviews
- Lost productivity from not having the position filled
- Productivity taken away from current employees trying to fill the role
Cost of Compensation
Inflation has touched every part of the country’s economy, including candidates’ salary demands. Following years of an employee’s labor market, wage inflation can be a factor in adding to the cost of recruiting. However, this often ebbs and flows over time.
Get Help Devising a Strategy to Recruit Top Talent
At Insight Global, we know how challenging the current job market is. We also know that having the right recruitment strategy in place can help you overcome the cost—time and fiscal—challenges that recruitment can cause. But we can help. We’re experts at hiring, placing over 50,000 people in roles in 2022 alone. We can make hiring easy.
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