You already know your employees are the most valuable part of your team. When you factor in the average cost of recruiting, you have a good idea of how expensive it can be to lose top talent.
The real cost of losing employees varies based on positions, but it can be costly to lose a member of your executive team. When you consider things like lost productivity, risk of reduced revenue, costs of onboarding, and the time and money spent on recruitment and outreach, it’s easy to see how costly lose an industry executive can be.
- SHRM estimates every time a business loses a salaried employee to voluntary turnover and has to rehire, it can cost the business an average of six to nine months’ salary. That is a huge non-budgeted business expense, especially considering it isn’t going towards compensating someone for time and talent going into growing the business, developing leadership and company strategies, and more.
- When it comes to C-suite level replacements, some studies note the average cost of replacing an executive like a CEO can be up to 213% of their salary. That can be up to $213,000 to replace an employee earning $100,000 annually.
- The biggest costs a business incurs when they lose a leader isn’t always monetary or incurred from recruiting costs – sometimes it can lead to additional business turnover or a reduced business reputation as the loss of an executive can lead employees and clients alike to ask, “Why did they leave?” Questions about a company’s culture – and whether they’re able to retain talent – can have a negative impact on the business.
How companies reduce turnover will vary based on the business, but one of the things that can keeps organizations from losing talent is being proactive about their employee retention strategy. Taking the time to invest in the right talent, as well as defining and living quality company values that contribute to a positive corporate culture, can lead to better employee retention throughout the whole organization.
If you need to hire an executive team member, we can help. Our expertise can help you find the best fit for your company and keep your company successfully moving forward. Contact our executive recruiters to get started.