If you are a business owner or hiring manager, looking for new employees can be an overwhelming process. Full-time employees can benefit your business in several ways, but there are often hidden costs of hiring full-time, part-time, or temporary employees. Full-time employees receive more monetary compensation and often require more resources than a temporary employee, which could benefit your business in a harsh season. Let’s compare the hidden costs of different employees and how they can impact different businesses.
The Hidden Costs Of Full-Time Employees
When you hire a new team member to help with production and workload, many different costs and operations need to be completed for a smooth transition. Hiring a new employee requires you to establish their salary or hourly pay, taxes, insurance, and other changes to your company assets and finances when adding another person to the mix. Let’s look at some of the upfront and hidden costs that come with full-time employees.
Upfront Costs
The highest cost for businesses is the upfront costs, including processing background checks, obtaining supplies, drug screenings, and any costs incurred to recruit or hire the new employee. Conducting interviews can also steal some of the hiring manager’s or employer’s time, which may result in lower productivity and some lost revenue due to conducting long interviews. This time will need to be calculated for your yearly expenses.
On-Boarding Costs
Costs associated with bringing the employee onto the team can often hurt a smaller business if it is not prepared. Orientation period, training, and obtaining supplies can all add up quickly when hiring a full-time employee who requires information, uniforms, protective equipment, and other objects to effectively do their job.
Compensation
Finally, the compensation and administrative costs of keeping the employee on your team for the long-term can sneak up on you if you’re not careful. Providing the employee with benefits, insurance, paid vacation, and their typical salary can add up for a business if your income isn’t exceeding your output.
Bad Hires
One of the most draining expenses on a business is what is referred to as a bad hire. This is an employee who you thought would be a good fit, but a few months down the road, you realize they aren’t as productive, effective, or trustworthy as you thought. Making a hiring mistake can cause ripples in your office or production team, affecting team morale as well as revenue. If you have happened to hire a bad hire, you could lose up to 30% of the employees supposed first year earnings. Working with a temporary staffing agency can help you avoid these potential employees by seeing options who have demonstrated real work experience and who have been pre-screened for cultural alignment.
How Temp Staffing Costs Differ
While hiring a temporary worker also comes with some cost to your business, it can be significantly reduced, especially if you work with a staffing agency. Cutting down on the interviewing process is one of the benefits of working with an agency, as their team will have vetted the candidates before they come to you.
Agencies that provide temporary workers will also have a margin in the employee’s salary to help offset the hidden costs of taxes, insurance, and administrative fees. This saves you from higher payroll taxes and expenses like workers’ comp and health benefits. While hiring any employee usually requires the employer to absorb these costs, working with a staffing agency requires the staffing agency to absorb the cost, rather than the employer.
Should You Go Through A Temp Staffing Agency
For businesses that are just starting out or that have temporary high demand, working on finding a temporary worker may be the best financial decision. Hiring seasonal or temporary workers can help you stay on top of important tasks and deadlines, without the hidden costs of hiring multiple new employees. Working with a temp staffing agency can save business owners and hiring managers a world of stress.
Working with a temporary staffing agency can allow a variety of industries to benefit from the productivity of a temporary worker while also saving on overhead costs. In an ever-changing economy, hiring temporary workers may help you get through a busy season without any damage to your business.
Working With All Trades Staffing
Finding the perfect job and the best workers isn’t easy, but working with All Trades can help you have confidence in your decisions. Our temporary staffing solutions can serve a variety of industries and help applicants find a job in as little as 48 hours. Every applicant goes through a rigorous screening process before we put them out to employers. Each employer will have confidence in our applicants’ work ethic, background, and knowledge when hiring All Trades staffing. View our current job opportunities or reach out to us to learn more about our company.
