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The true cost of healthcare recruitment: why it’s about more than money

12/11/2018
Posted by: Lynn Sedgwick

A stable workforce means that things run smoothly and without interruption, so when a staff member leaves it can have a big impact on the wider team. Valuable skills and job-specific knowledge that have built up over time disappear with a departing staff member, leaving you in a tricky position to bridge the gap. These practical implications of recruitment can have just as heavy a cost to your organisation as the financial element. 

That’s why we’ve put together this guide to help explain what the true cost of recruiting is. From finances to how attrition rates impact your recruitment costs, we’ve considered some of the things you may not have thought about when it comes to recruiting. 

Recruitment costs: facts and figures

To understand the true cost of recruiting, it’s useful to look at the facts and figures and what costs they refer to. When a staff member leaves, your organisation could find itself paying for everything from recruitment agency fees to the wages of temporary and locum staff. 

But what if you’re looking to expand your staff rather than replace a departed team member? 

According to a case study for Hillingdon Hospitals’ NHS Foundation Trust, it cost £403.70 per nurse to recruit in-house during a recruitment drive. The breakdown of figures show that the majority of the costs were spent on holding recruitment events (£6,312.50), the recruitment process after the interview (£866.18), and preparation for the event (£707.70).

And while the financial figures are, of course, striking it’s important not to overlook the bigger picture. Not only does recruitment represent a monetary cost to the organisation there is a range of knock-on effects:

  • HR spends considerable time processing individuals, completing all the relevant paperwork as well as sourcing replacement staff.
  • Management has to spend time arranging for work to be covered, either by distributing it amongst existing staff or appointing temporary cover. There’s also the time spent away from everyday work attending recruitment events, shortlisting candidates and conducting interviews.
  • The workload of colleagues increases and there is a general reduction in productivity as staff take time to readjust and the new person (or people) settles in.

So, healthcare trusts don’t just need to think about the cost of recruitment itself, they must factor in the time spent carrying out activities related to recruitment as well as fees spent on temporary cover. According to The Telegraph, the NHS spent £2.4 billion on agency staff in 2017. Not only is this expensive, it’s time-consuming: resources which could be used to retain staff are instead spent on finding a replacement – either permanent or temporary – to make up for the shortfall.

Attrition rates and their impact on recruitment costs

Losing a well-established member of staff is undoubtedly a blow to your team, although it’s equally important to consider how attrition rates feed into your overall recruitment costs. If you find that you hire someone only for them to leave after a short while, or if staff aren’t sticking with you for the long term, it can have a huge impact on your overall cost of recruitment. What’s more, if staff churn is causing disruption, then it’s unlikely that your workforce is operating at maximum productivity.

The nursing shortfall has been openly discussed in the national press, however the staffing challenges faced by care homes and social care organisations has been discussed much less widely. According to figures published in the Guardian, there are as many as 90,000 vacancies for care workers on any given day. Chronic understaffing means increased recruitment costs for organisations as they spend longer trying to place a candidate and dealing with the complications caused by a lack of staff.

Turnover rates are also notoriously high among social care workers; Skills for Care’s report into The state of the adult social care sector and workforce in England found that turnover rates are as high as 30.7%. Losing one-third of your workforce across a year doesn’t just lead to large recruitment costs, it jeopardises staff morale, reduces productivity, and makes for a less than satisfactory patient experience as budgets and timescales are juggled. 

Having a plan in place to attract and retain the best talent is always a good idea, and if you find that your turnover rates are starting to creep up it’s worth revisiting your employer branding. Perhaps something is missing or is not connecting with staff and candidates and a few small changes could reduce turnover. The important thing is to monitor and refine: stick with what works and change what doesn’t.

The benefits of using a recruitment agency

Knowing what will attract candidates, what will drive them away and what will help to keep employees is invaluable. And especially when it comes to attracting candidates in a field such as healthcare, having the experience and know-how of a specialist recruitment agency on your side can make a big difference.

Of course, using a recruitment agency rather than recruiting in-house is a financial investment. However, by making use of a partner with specialist skills, your staff are free to do what they do best, meaning that you save time and money in the long term. Placing the right candidate with your organisation will also reduce attrition rates; and reduced attrition rates mean that you spend less on recruitment than you would have done if staff turnover remained high.

A recruitment agency will be able to personalise their service to meet your needs, so you can choose exactly the level of involvement that suits you. What’s more, an extensive network of candidates will mean that your agent can think outside of the box and help you to consider candidates that you might not otherwise have done, giving you more choice.

If the true cost of recruitment is proving to be an issue for you, perhaps we can help? Even if staff retention is something that your company has been struggling with why not give us a call on 01772 259 121? We’ve over thirty years’ experience in recruiting healthcare professionals and would be pleased to help.

You may also find out recent blog ‘Talent retention: save time, money, resources and  improve patient care’, of interest if you’re looking for some new ideas on how to retain your staff.

And please feel free to register your vacancy online, if you’re looking to recruit at the moment.

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