According to research compiled by the Center for American Progress, high employee turnover results in significant costs to businesses across most industries. It costs businesses about 20% of an employee’s annual salary to find a replacement and that percentage rises to more than 200% of annual salary when replacing a highly trained executive.
Of course, there are hidden costs of employee turnover as well. Most notably for technical staffing is the reduced productivity from the loss of a key engineer and the added stress placed on the remaining employees who are now stretched to cover the current projects of the whole team.
The hidden costs can be exacerbated by both a lengthy staffing & recruiting process, and the time it takes to get a new employee up to speed on company processes, drives and folders, and project specifics. Using a specialized technical staffing agency can shortcut the time and overall costs that inevitably squeeze most organizations as they find a qualified and available engineer, software developer, or IT professional.
To curb the high cost of employee turnover, some companies like Facebook are going to extremes to attract and retain highly qualified software engineers. On top of the shops, salons, dry cleaners, free lattes, ice cream, employee game days, and a giant outdoor movie theater; Facebook is adding luxury apartments that are just a bike ride from its Menlo Park campus.
Most companies cannot compete with these over-the-top perks and fortunately, they do not have to. The study above suggests that employers can improve retention rates of their technical staffing by offering flexible work schedules and work-from-home options depending on the nature of their work. Another key incentive is to provide side project autonomy and cross-functional collaborations that build company culture.