The recruitment industry is broken. And here are some numbers which will help you realize just how much.
…while technically a percentage or a fraction of a whole, is nonetheless our first number.
According to a study done by Citation, a massive 50% of the UK workforce is ready to up sticks and change jobs. A half of all Brits in employment are ready to leave their jobs at some time in the next 12 months.
Can we talk about this for a moment?
First, can I just say, that since I decided to launch a start-up and have spent every spare waking moment either writing, talking or thinking about recruitment and technology, I have inevitably become something of an expert in the recruitment market. Atop this and, not to toot my own horn or anything, but I’ve always had a fair penchant for insight, for reading patterns or trends.
The point is, despite everything that I have read, I still find that number amazing. 50%! Step it up businesses; half your staff want to quit!
I mean, can you imagine if half of the staff at your place quit?! Now?! Can you imagine HALF of your workplace being replaced by eager, but inexperienced newbies with their love of misunderstanding things and constant need for training?
It could happen though, especially if you live in London. Apparently a monsterous 64% of workers in London are eyeing up that lush green grass on the other side. Leaving a potential 64% of all current job roles in London open to greener-than-grass newbies over the next 12 months.
How insane is that? Pretty insane, right? Well we’re just getting warmed up.
Our next number is £30,614.
£30,614 is the average cost to an employer to replace ONE member of staff. This includes both the cost of lost productivity while replacing and training and the straight up cost of recruiting and on-boarding a new worker. £30k is an unbelievably high-cost to replace Greg, the sales exec who eats too many eggs to be considered anywhere near reasonable.
The largest factor influencing the cost was the loss of output while replacing and then training up an inexperienced staff member to operational speeds. In fact, it was calculated by Oxford Economics (who conducted the study) that workers take 28 weeks to reach optimum productivity which has an attached cost of £25,181 per employee. Above this, there is another £5-grand incurred on various logistics costs: paying recruitment agencies, advertising the role, conducting interviews etc.
So, you’ve got the time pressure to replace a team member weighing against the financial pressure of getting it right the first time. A tough pair to marry in anybody’s book.
Now we’ve come to our third number of the day and it is a big one: 32.7 million.
32.7 million is, according to The Office for National Statistics, the amount of people in work in August 2017 (aged between 16-64, seasonally). That’s a 75.1% employment rate in the UK which is pretty damn good.
This is my favorite number for two reasons:
- The current employment rate, according to The Office of National Statistics, is the highest since records began in 1971. Go UK, well done you!
- It means 32.7 million potential clients and customers for Aspireapp.co. Go Aspire, well done me!
Now it’s time for the summary, in this post I’m simply going to title it:
Okay guys, so we’ve just taken a quick look at three recruitment & employment stats from the UK economy this year. Let’s examine them as a whole, shall we? Then you’ll see how the summary got its title…
- 32.7 million – The number of Brits currently in work.
- £30,614.00 – The average cost to replace a UK worker.
- 50% – The amount of people currently planning to change jobs in 2018.
Do you see where I’m going?
If 32.7 million people are in work and 50% are planning on changing jobs in the next 12 months then that means that 16.35 million people will leave their current jobs in the next 12 months. 16.35 million roles to fill.
But there’s more!
If 16.35 million people are going to change jobs in the next 12 months and each job change incurs a cost of £30,614.00 then it’s going to be an expensive year for UK businesses…
I’m going to write it out in full now, no abbreviations, so you can simply marvel at the cost of 16.35 million workers changing jobs to the UK economy.
In pounds sterling, and off the back of the excellent studies mentioned above, the potential costs to the UK economy of 50% of its current work force changing jobs over the next 12 months could be around £500,538,900,000.
£500,538,900,000. This is a number which should never be allowed in the loss column. Yet here it is, sitting in the loss column of the profit and loss statement of the recruitment industry. If a business had invoked a potential loss of £500,538,900,000 over the next 12 months, even if the actual chance of them hitting this loss is low, then it would be clear that the business needs to be changed or shut down. Well 16.8 Million people are planning on changing jobs next year – so we can’t get rid of the recruitment industry. It is time for a change though. Recruitment is an ageing cargo boat among stormy seas and it’s time to sink the old girl and make a major modification to the way recruitment has been done over the last few decades.
The magic FIX – make recruitment cheaper and use data to make it more efficient.
First thing that needs to happen is to make the recruitment process in its full glory cheaper. This can happen in many different ways:
- reducing the cost of talent sourcing by allowing access to a deep, deep, deep talent pool (and by default no need to pay out to greedy recruitment agents)
- reducing the cost of the interview process by providing tools purposely designed for the hiring team to make their life easier
- reducing the on-boarding time for the new recruit with well thought training plan and materials
Second thing, and I can’t stress it enough, businesses will benefit humongously from good application of company data, supporting data driven recruitment. Being able to understand the profile of your workforce, analyse the workload vs. team availability, plan ahead and recruit calmly, without running around the office with your tongue hanging on your chin – these are the things that make modern hiring team run smoothly.
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Recruitment has been to slow to move for too long. That’s all about to change. Be a part, join the revolution. SIGN UP TODAY!