An economist that I heard interviewed on @NPR this week talked about the unforeseen cost to employers of cutting staff hours to part time. They were trying to avoid the cost of medical coverage. But it backfired! The economist described increased costs, turnover, and headaches.
So what happened? Well, it’s pretty logical. Part time positions without benefits don’t attract the qualified people needed to get the job done. Without the right people, things just don’t go right. It’s expensive.
When you buy clothes or a car, it costs more for high quality that lasts longer. Why not take the same approach for hiring your team? It costs more in the long run to “go cheap” and exposes your organization to these four risks:
1. High Error Rate
Unqualified employees make mistakes that are time-consuming and expensive to correct. Assuming the mistakes are detected…what if they’re not? The cost of an unhappy client is incalculable.
Experienced people know what to do and how to it. They assess new situations quickly and accurately. Inexperienced people take more time because they are figuring it out as they go, or need a lot of supervision.
3. High Turnover
Unqualified employees means high turnover. Hiring and training takes time. Vacancies on your team put stress on your other employees. Time and stress don’t show up on your financial statement, but they are real costs you cannot recover.
4. Limited Growth
Employees without the right skills and experience may not even know the basics, let know alone good business practices. Organizations planning to grow need people who can keep up with changing conditions and new methods.
Getting the right people on the team isn’t easy. It’s pretty much impossible if the pay isn’t enough to attract and retain them. Considering the four risks of not investing in the right people will head-off the expensive issues later.