Welcome to the March 7, 2007 issue of The Total View

Published by Success Performance Solutions, Written by Ira S. Wolfe

Pre-employment assessment tests have been around for ages.
Some are pinpoint accurate and will help you make smart hiring decisions. Others deliver only a surface-level look at a candidates personality traits ... and little else.

Attend this 60-minute web-event on to learn about how good employee assessments work and how to make sure you are using the right ones.

Click here to register for this mini-course.

Don't delay - register now or call 800.803.4303. Limited to first 10.

Visit our Human Resources Blog and Perfect Labor Storm Blog where we can post daily (and more often) human resource updates, news, and Perfect Labor Storm facts. 

What's Inside:

1.  Forty-three percent of employers report more difficulty in finding dependable and skilled workers

Are worker shortages and turnover costing your business more? Is it taking longer to hire workers? Is the quality of available workers hurting your business productivity? Read more what over 150 HR professionals and executives told us in a recent survey.

Several weeks ago during one of my webinar presentations, a HR director responded that the cost-to-hire an employee figure I used - $13,355 - seemed high. Naturally I asked her "what do you feel it should be?" She didn't know, "it just seems awful high."

She might be right. Over $13,000 to hire a single employee might be high.   This was just one organization's research (Employment Policy Foundation, 2004).  Then again, other studies have estimated the cost from as little as 25 percent of annual salary to the astronomical estimates of 14 times annual salary for executives and salespeople. From my own research dating back to 1999-2000, I found the cost-to-hire as low as $3,500 for a housekeeper to over $50,000 for a registered nurse. Based on the increased competition for labor and escalating wages, these numbers are likely higher too.

I was curious. It seems all the Google searches, HR articles, and business articles all point to the same sweeping generalizations. Surely, I thought, some organizations have to be tracking the cost to hire an employee, especially with all the buzz about turnover, impending retirements and skilled worker shortages. So I started to ask clients and prospects.

What I discovered was shocking although not necessarily surprising: few organizations are actually tracking what it costs to hire an employee. I'm not talking about tracking the cost of advertising, marketing materials, job fairs, and background checks. I'm talking about the cost of HR's time screening resumes and candidates, manager's time interviewing, trainer's time training, lost productivity and mistakes due to inexperienced new workers, employee overtime to cover unfilled positions, and a host of other indirect costs such as employee morale issues and customer dissatisfaction due to turnover.

With all the attention focused on hiring and retention these days why are so few organizations tracking the costs to hire new employees? Without even a reasonable guess-estimate, how can any organization know if the investment to acquire a new employee is too high or too low? How could they know if attending job fairs, advertising on job boards, or offering signing bonuses is worth it or not? I'm sure you can ask any HR manager how much is allocated in their budget for pens and paper and purchasing new PCs and they can look it up. But ask about how much does it cost them to acquire a new employee and the responses range from "we don't track that" to "that seems awful high."

Despite my disillusionment that HR still was running their business without metrics, I didn't want to lump all organizations in the same bad practice basket. I engaged one of our strategic partners, B21 Publishing, to publish a random survey of their human resource customers. Over 150 HR professionals and senior level executives responded:

"Less than 32 percent responded that they were tracking the cost to new hire employees." That is a disappointingly low response and demonstrates a continuing gap between sound business practices and the business of human resources.

I also repeated a similar survey to a local (Lancaster HR organization) and the response was even worse: only 10 percent of the companies were tracking the cost to hire.

To be fair, many of these organizations may be tracking even better metrics than the cost-to-hire such as the quality of hire and time a position remain unfilled. Unfortunately I'm not optimistic after receiving comments like "we don't have the time" and "it's difficult to measure." Just try using one of those answers the next time your boss asks you how much you'll need to allocate in next year's budget for office supplies and computer equipment.

Other results of the survey included:
* 44 percent responded it was more difficult to find skilled workers in 2006 compared to 2005.
* 43 percent said it was difficult to find dependable workers in 2006 compared to 2005.
* 30 percent said is cost between $1,000 and $2,499 more to recruit a new employee in 2006 than prior years; over 27 percent reported it cost more than $2,500.
* Over 47 percent reported it taking 2 to 4 weeks longer to fill open positions in 2006; over 33 percent said it took more than 5 weeks longer.

To learn more about tracking and reducing the cost-to-hire employees, call us at 800.803.4303.

2.  Perfect Labor Storm Alerts # 625 - 626

Pre-release Special! The Perfect Labor Storm 2.0 has landed. The year 2007 will see an increase in skilled worker shortages and more competition.   The result will be higher salaries, more training and career advancement opportunities, and more flexible work cultures. How prepared is your company to find skilled and dependable workers?

Perfect Labor Storm 2.0 is the newly updated and revised 2007 edition of best-selling book first published in 2005. You can now download an advance copy of PLS 2.0. a $10 value with every purchase of the original Perfect Labor Storm, still a great value at $7.95.

Fact #625: To offset projected labor shortfalls over the next decade, the 55+ age group will need to increase its labor force participation from 40 percent to 51 percent for males and 26 percent to 40 percent for females. At the same time, the 20 - 29 year olds group will need to increase its labor force participation from 87.5 percent to 105.4 percent for males and 75.2 percent to 90.6 percent for females. (Source: Watson Wyatt, World Economic Forum 2004)

Fact #626: The estimated retiree/active worker ratio is expected to increase by 71.4 percent in the United States by 2030. Switzerland is expected to experience a 100.2 percent increase for the same period. Italy's retirees will outnumber its active workers by 2030. (Source: Watson Wyatt, World Economic Forum 2004)

Don't miss day-to-day updates on Perfect Labor Storm.
Save the Perfect Labor Storm blog to your favorites.

Don't be caught in storm without all the facts. "The Perfect Labor Storm Fact Book: Why Worker Shortages Won't Go Away" is a must-read leading edge forecast that predicts workforce trends for decades to come. Order your copy today - Only $7.95.

3.  Manager's Pocket Guide to Recruiting the Workforce of the Future

In today's downsized, restructured, and reengineered workplace, there is \a tremendous pressure to recruit high-quality people in order to get more work and better work doen with fewer people. Through best practice, worksheets, and checklists, Recruiting the Workforce of the Future will show you how to develop and implement effective hiring solutions for today's workplace.

Employers should no longer recruit for the long term, but to get the job done today, tomorrow and next week. Give your organization the advantage in quickly and effectively recruiting the talent you need.

Order Manager's Pocket Guide to Recruiting the Workforce of the Future

4.  Interview candidates online - fast, convenient, cost-effective

Total Applicant Processing System (Total-APS) provides an affordable and efficient online recruiting system for small and medium size businesses.

Total APS is not just a resume processing system: it is a complete, total applicant processing system that includes job fit screening and selection tools. It enables managers to list job openings, administer screening tests, and direct candidates through an application that produces a ranking score, saving managers dozens of hours. Instead of sifting through piles of resumes and playing voice mail tag, managers can target their search to only the most qualified candidates. Simplify your hiring process today and employ the most powerful assessment tools to determine a candidate's job fit.

Learn more about Total APS (Applicant Processing System)

5.  Sixteen Reasons Why Clues Beats All Other Pre-Employment Testing

Employers have tested more than 100,000 employees with JobClues?
to measure how well they fit a job description. Learn why they chose Clues over the competition

6.   Quotes from Hire Authorities

"Forty percent of employers report they currently have job openings for which they can't find qualified candidates."
Matt Ferguson, CEO of Careerbuilder.com.

Ira S. Wolfe Copyright 2007 - All Rights Reserved. Reprints and other distribution by permission