It’s been awhile since CIOs have had to worry about staff turnover. But as the economy picks up, it stands to reason that companies will ramp up hiring efforts and try to lure away your best performers. According to Forrester Research, it can be much cheaper to start doling out pay raises and other rewards now rather than wait until staffers leave. The cost of turnover, says Craig Symons, a principal analyst at Forrester, has two major components: hiring costs and vacancy costs. Hiring costs are the hard costs associated with recruiting a new employee (advertising fees, and costs for screening, interviewing and processing candidates). Vacancy costs include the less obvious (but very real) costs of replacing the former employee (compensation for interim replacement or overtime for work assumed by current staff, productivity losses, and loss of knowledge of unfinished projects and institutional business knowledge). According to a Forrester estimate, the average cost to hire ranges from 25 percent to 100 percent of a worker’s annual salary (this estimate does not include vacancy costs). In other words, if a midlevel IT manager who earns $75,000 in annual salary decides to leave, it could cost anywhere from $18,750 to $75,000 to hire a replacement. Those figures will vary, says Symons, based on the type of job and the skills required for it, the tenure of the former employee and corporate HR policies on hiring. However, the message is clear: Turnover is expensive.Best PracticesHave a good training and development program in place. “The best retention vehicle is investing in your people,” says Craig Symons, a principal analyst at Forrester Research. Identify your key people and spend time and attention on them. They will create the biggest problems if they leave.Don’t underestimate the value of noncash rewards. At the end of the day, says Symons, people would rather have a dollar in their pocket. However, publicly recognizing employees for hard work has value. And it’s cheap too. Related content BrandPost How Infosys and Tennis Australia are harnessing technology for good By Veronica Lew Mar 26, 2023 6 mins Infosys BrandPost Retail innovation playbook: Fast, economical transformation on Microsoft Cloud For retailers, tight integration of data and systems is the antidote to a challenging economy. By Tata Consultancy Services Mar 24, 2023 3 mins Retail Industry Digital Transformation BrandPost How retailers are empowering business transformation with TCS and Microsoft Cloud AI-powered omnichannel integration and a strong, secure digital core lets retailers innovate across four primary areas while staying compliant, maintaining security and preventing fraud. By Tata Consultancy Services Mar 24, 2023 4 mins Retail Industry Cloud Computing BrandPost How to Build ROI from Cloud Migration This whitepaper and webcast can help you calculate the ROI and create a business case for modernizing your legacy applications to the Microsoft Cloud. By Tata Consultancy Services Mar 24, 2023 1 min Retail Industry Cloud Computing Podcasts Videos Resources Events SUBSCRIBE TO OUR NEWSLETTER From our editors straight to your inbox Get started by entering your email address below. Please enter a valid email address Subscribe