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Cost
of Employee Turn Over
No employee benefits' premiums
No vacation, sick or holiday time to pay
No taxes-Payroll, Social Security
No Medicare, Unemployment
No Worker's Comp
No legal responsibilities associated with employee policies
More Benefits...
No additional office space
No additional office equipment or furniture
No ongoing training expenses
No agency fees
Never pay for downtime, breaks or personal issues
No employer compliance issues
On the other
hand....
The Cost of a
Business Solutions Provider
Hourly $25.00*
Effective Pay
$25.00
Hours per Year
1040
Total Cost
$26,000
Savings $21,408
*Based on
retainer rate.
Due to not having to pay benefits, overhead and taxes along with the fact
that you only pay for the time you need, you actually save more than $20,000
a year by contracting with a CCMA professional rather than hiring a
full-time employee!
Not only that, but because CCMA’s consultants’s are more experienced, more efficient, and
better connected than the employee, you'll need to devote far less time to
the project to get the same results---only 1,040 hours a year versus 2,080
for the new employee.
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Did you know that the real cost of an employee is 2 to
2-1/2 times their salary?
Surprisingly, a $12.00/hour assistant really costs you $27.60!
Pay Rate $12.00
Benefits $4.75
Overhead $6.25
20%
Inefficiency $4.60
Total Hourly
$27.60
Hours per year
x2080
Yearly Expense
$57,408
True Hourly
$27,60
In the case of hiring an employee, this new employee is paid a wage of $12 an
hour. However, this wage is not a true cost to the company.
The cost of benefits for the employee (health insurance, life insurance,
401k, and so on) weighs in at approximately 35-40 percent of the hourly wage,
or $4.75.
Overhead: electricity, offices, computers, etc. - costs the organization
another 50-60% of the employee's wage or $6.25 for each hour worked and paid.
Then you must figure in the "Inefficiency Factor"; time spent at
the water cooler, personal calls, smoking breaks, etc.
This brings the employee's total cost to the organization to $27.60 an
hour--more than double the wage paid to the employee for each hour worked!
When you multiply the hourly rate by the standard number of
hours in a work year, the grand total for the new employee comes to a very
costly $57,408!
One More Thing:
The costs
described above are those you will incur to comply with state and federal
laws. They are not all the "extra" costs of having employees.
Employee benefits such as paid vacations, insurance, retirement plans, and
maternity leave (just to name a few) all contribute to your costs. Though
most of these are optional in that you are not required to provide them, they
are often necessary to attract and keep good, qualified workers. Beyond that,
to make those workers as competent and effective as they can be, you may have
to incur training costs. In short, when considering what your employees
really cost you, don't forget to consider the whole picture, and plan and
budget accordingly.
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