Is paying less saving more? Turnover can cost thousands of dollars per employee by Pa Britney Xiong
Is paying less saving more? Your first reaction, if you're an employer, would be, "Of course!" But, are you really? When I ask employers why they have a high turnover rate, they tell me it is because they pay low. Then I ask them if they have calculated how much their turnover is costing them. Most say no. If employers know how much their turnover rate is, it will help them to decide if it is beneficial to pay their employees more money. Turnover can be calculated based upon how much you are paying a supervisor to train someone, recruiting costs, payroll costs, and even firing costs (if you have to deal with litigation). Now, take a minute to think about why people need money. Expenses are the same for everyone. People don't get a discount because of their income level. For example, Wal-Mart still charges everyone the same for consumable products, McDonalds charges the same for a burger, gas costs the same, and the list goes on and on. The reality is that no matter where you live in the United States, you pay the same prices./Sometimes it is not possible to pay more money for a position because of the financial situation you are in. Then ask yourself: "Can I afford not to pay more?" About the author: Pa Britney Xiong is president of Western Bilingual in Milwaukee, whose motto is, "Bringing diversity to global businesses." she can be reached at (414) 672-6088 or Britney@westernbilingual.com. Visit www.westernbilingual.com Xiong can help calculate your turnover cost and a competitive pay rate for a position.