Hiring internally is a good thing for many reasons. People who already work in an organization already know the culture. They have proven themselves to be a fit. The hiring process for internal candidates generally takes less time. The candidates may require less training.
It’s also widely thought to be less expensive. Organizations save money advertising and potentially spending on travel and relocation. The reduced time to hire may mean more productivity and less lost revenue, ultimately.
So, hiring internally can cost an organization less. One estimate is that new hires can cost more than $15,000, while internal hires cost $8,676.
But don’t let the price tag differential fool you. While hiring internally is less expensive, it still comes with a price tag. The costs to hire internally are much more than simply adjusting an hourly wage.
First, paperwork and adjustments take a great deal of time on the part of human resources. Paychecks need to be recalculated and reconfigured for multiple withholding and categories. State, local and federal taxes all need to be computed. These include Social Security, FICA, Medicaid taxes, FUTA, state unemployment taxes, workers compensation and payroll taxes. All need to be computed and adjusted.
Second, benefits may need to be reconfigured and reworked. Depending on your organization, a different title and/or pay grade may mean employees are eligible for, or fit into, a different set of benefits. This will need to be discussed with them. They need to be informed and adjustments made.
Worried about these costs and the potential time and money they might add to a new hire? A staffing services firm can help your organization with all these issues. We are experts at configuring and adjusting salaries, taxes, required withholdings and benefits.
Looking for Help With Hiring?
Graham Staffing Services will be happy to help you with any needs related to internal hires. We can reduce the effect on your human resources departments and let all your departments be optimized for maximum service. We’re here to help. Contact us today.