The Cost of Loss

You’ve already seen the numbers. You know, the ones that tell you how much it costs when a talented employee walks out your door. It’s been well documented that it costs 70 percent to 400 percent of an employee’s annual salary to replace him or her. Some of those costs are easy to measure and are sometimes called “hard costs.” Think about one talented person you lost recently. What did it cost your organization to replace her? Did you:

recruit on job boards or run Internet ads?

hire a headhunter?

pay a referral fee?

cover candidates’ interview expenses, such as airlines, hotels, meals, or cabs?

commit to a larger salary or give a sign-on bonus to the new recruit?

offer a moving allowance?

It adds up.