Where I live (in Idaho), the cost of replacing an employee
averages somewhere between $17,000 and $31,000. Employees making
over $60,000 per year cost more than $38,000 to replace. The
problem for most employers? Many of these costs are hidden and
spread out, so they don’t glare at you as a single line item
in the budget.
When I present these figures during a training session, some
people scoff and say it can’t be true. All I can say is
don’t shoot the messenger. These numbers come from the
Department of Labor and the Society for Human Resource
What about entry-level workers? Surely it doesn’t cost
$17,000 to replace them. Usually true, but it still costs more than
people think. A few years back I conducted a workshop for a retail
Mall Merchant’s Association. In an exercise during the
workshop, the merchants discovered that among their own group,
$2,000 was the least amount it cost replace an entry-level
Replacing employees is expensive
If you’re an employer, how much time does it take for
you to earn $2,000? If you make $50,000 per year it’s 80
hours. If you earn $100,000 per year, it’s about 40 hours. If
you earn $200,000 per year, it’s 20 hours of precious
Therefore, if you could get something done in less than 20
hours that helped you retain just one entry-level employee,
you’d be saving money.
That’s an amazing claim, but do the math. Then calculate
how much time it takes you to earn $17,000. Then calculate for
$31,000. Those are realistic costs for replacing just one
employee From this, it’s pretty obvious we need to do more
than find great employees; we need to keep them, too.
To keep them around, we must examine the real reasons
employees leave. Most say it’s because they’re seeking
better pay. Wrong answer, try again.
The Harvard Business Review reports that the number
one reason people leave is Job Content. It has to do with
people feeling bored and directionless in their careers, or because
the work they’re doing is not what they thought their job
Thankfully, an easy, inexpensive, and powerful fix is
available: Accurate job descriptions.
Already have them? Think you’re all set in that
department? Think again. Over the last ten years I can count on one
hand the number of people who’ve told me their written job
descriptions are accurate.
Take your time; Do it right
Benefit #1: Clear, specific job descriptions make it easy to
create interview questions that weed out applicants who don’t
match—and identify ones who do.
Benefit #2: Even the best, most engaged new-hire becomes bored
and disengaged if he doesn’t think he’s contributing to
something bigger than himself. Written job descriptions are
foundational for helping people see how their work fits into the
Benefit #3: Rarely does a new-hire have every piece of
knowledge, skill, and attitude needed for success. By using job
descriptions as a check sheet for training, employees learn what
they need to do. A collection of well-written job descriptions
provide direction for future learning, too.
Benefit #4: Finally, job descriptions are great for
structuring performance evaluations. Most company’s
performance eval forms are severely overly-generic. Accordingly,
employees aren’t sure just what they must do to get a stellar
Job descriptions to the rescue. With a clear list of assigned
duties and tasks forming the foundation for annual evaluations,
employees are regularly reminded of what’s expected of
All this is well and good, but finding a class on how to write
job descriptions can prove difficult. And finding a useful book on
the topic is almost as tough.
Resources are available
One highly-rated book is Results-Oriented Job
Descriptions by Roger and Sandra Plachy. Published in 1993 by
the American Management Association, it’s a bit old (and
pricey: $64), but it has over 200 actual job descriptions written
in a useful format you can adapt to your needs.
You can get The Job Description Handbook by Margie
Mader-Clark, or an e-book available on my website
(workplace-excellence.com) entitled The Really Easy Way to
Hire, Train, and Retain Great Employees. Both cost much less,
and both provide step-by-step instructions for creating accurate
and complete job descriptions.
Bottom line, job descriptions are like stealth secret weapons
for hiring, training, and retaining great employees. I guarantee
whatever effort you put forth will save you hundreds of hours and
thousands of dollars.