The Great Resignation took the United States workforce by storm and stalled the productivity of many companies while trying to fill open positions and smooth out operations in a post-COVID landscape.
No matter which way you look at it, an employee leaving a company turns into a costly expense for a business owner, which creates a shrinking profit margin, cash flow shortages, and even affects the company's ability to provide a quality service to its clients.
In this article, we will discuss how employee turnover within your accounting department is costing you more money than you think and some suggestions to consider to try and prevent such expenses.
Where Does Turn Over Cost Come From?
There are a few different areas from which the initial cost of employee turnover stems:
- Recruiter fees to source replacement employees
- PTO payouts from accrued time off
- Advertising for hiring efforts
- The labor cost of current employees that are now aiding in writing recruitment ads, reviewing resumes, and interviewing new candidates
- The labor cost of current employees that are now picking up the slack from a lost worker, could now involve overtime pay
Once a replacement is chosen and hired for the open position, another round of costs follows. These could include:
- Training newly hired employees for the position
- Loss of productivity during the training period
- Maintaining client relations to avoid loss due to turnover
How Can You Prevent This Turnover?
There are many ways to keep employees engaged in their careers and improve employee turnover rates. Good communication, fair salaries, and a strong support system are just a few of those things. To calculate the employee turnover rate for your company, use the following formula:
Turnover Rate (%) = (employees who left the company / total number of employees) * 100
It goes without saying that having a percentage closest to zero is the goal for all companies. But have you ever considered not having to worry as much about employee turnover within your accounting department altogether?
Consider The Outsourced Option
The option of outsourcing your accounting department may seem strange at first, but it will provide you with a host of benefits that will also remove that employee turnover factor from your business.
From a salary perspective, a basic in-house accounting department may have a Bookkeeper, a Staff Accountant, and a Financial Controller. Between the salaries of those employees, a company could be spending in the ballpark of $200,000 per year. In addition to that, there are benefits and overhead costs that come with having employees in an office space, all while having the risk of an employee leaving for a job elsewhere.
With an outsourced accounting firm, you are paying a monthly rate that gives you access to a full team of Controllers, Accounting Specialists, and more. It is without a doubt an alternative option that will save a company money, time, and resources in the long run.
An outsourced accounting firm like AccountingDepartment.com is a full-charge service that provides a company with a full accounting department takeover. We handle it all from start to finish and give business owners back the time they need to focus on growing their business.
With a team like AccountingDepartment.com, there is no employee turnover. You are assigned a dedicated specialist that will always be there for you, and if they are out of the office, our team is trained with a very specific set of policies and procedures, so that there is exemplary coverage at all times.
Absorbing the costs of employee turnover can be a thing of the past with outsourced accounting services. Reach out to AccountingDepartment.com today to learn more about how making the switch can help your business.