Employers: Do not underestimate the value of quality human capital
In these tumultuous economic times, everyone is clinging onto and fighting for every single dollar. It is less likely for people to part with money now, than during times of economic fruition and stability. However, there is a time and place for everything. Sometimes it is difficult to see a larger gain, a bigger picture, when one is deciding whether or not to part with a substantial amount of money. This is true when it comes to hiring employees and oftentimes even more important than the purchase of property, a vehicle, or other considerable tangible items.
With less older people having the opportunity and blessing to retire, and many young people just beginning to join the workforce, the job market pool is overflowing. A tough economy, coupled with an overpopulated candidate pool, drives salaries downward and unemployment upward, creating a devastating career marketplace trend.
It’s natural for employers to tighten their budgets and/or personal wallets, fearful of a future loss. It’s also natural for them to assume that they should hire an employee at a low cost, if that individual is capable of handling duties required for a particular position. It seems like a positive for a company that employees can be “bought on sale.”
Be careful not to underestimate the value of quality human capital.
If we look at this in terms of a product purchase, oftentimes products are expensive not necessarily due to a name brand, but due to the quality of the product. The quality or uniqueness of an item often creates the demand, which drives up the price, and grows the brand into a luxury item. People are no different. You may save a few bucks hiring an employee at a low cost, true, however, be mindful that for a few bucks more, you may procure an even better employee with more potential, who brings much more to the table. Do not sacrifice experience, general career knowledge, life lessons and many other characteristics of a more expensive and experienced employee merely to save a quick buck.
There is something to be said about training and molding a novice employee how you wish, however, training and mistakes along the way could prove costly. Every employee needs training to fit into a company, but it should be minimal. Loss of time in training basic skills, which translates into financial losses, shouldn’t be ignored. Hire entry level employees, at an entry level salary, for an entry level position. Hire experienced employees, at a fair-market salary, for an upper-level position. A seasoned employee has much more to offer and may need to be compensated as such. Veterans have a wealth of knowledge and problem solving skills you can’t put a number on. Years of life experience, coupled with years of business experience, often across multiple industries, are truly valuable. Oftentimes many may not even need benefits if he or she receives them from a spouse and, more importantly, may be more inclined to stay in a position for an extended period of time, rather than sample career paths. Stability is typically much more of a concern for a veteran employee and it should be for an employer as well. It must be expected that entry level positions are ever changing, while employees climb the corporate ladder, but do not hire people for a senior position who are beginning their career and will most probably not stay long term. You will lose much time and money hiring, training, and exiting employees.
This by no means is an issue of age; it is an issue of hands-on experience in the workforce with respect to general business knowledge, hospitality, career management, finances and social dynamics. An employer must evaluate the total gain in hiring an expensive experienced employee in comparison to the total loss in hiring an inexpensive inexperienced one, not simply try to find a person capable of filling a position cheaply. Yes, everyone needs to save money at this point in time and employers can still hire a superstar for less money, but make sure not to overestimate the importance of tightening purse strings and underestimate the value of quality employees.
Remember, numbers aren’t always number one. Sometimes cheap is simply cheap.
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