Replacing staff costs the retail industry £673m every year, with businesses spending £20,114 on replacing employees on a salary of £25,000 or more, a report has found.
The report, commissioned by income protection company Unum and carried out by Oxford Economics, said the time it takes getting the new worker up to speed was the biggest cost of replacing staff. On average, workers take 23 weeks to reach optimum productivity, which has an attached cost of £16,240 per employee.
Expenditure on advertising, recruitment fees and time spent interviewing was seen as the next biggest cost, with the average retail business spending £3,874 on such logistical costs. Within this, hiring temporary workers before the replacement starts (£2,749), management time spent interviewing candidates (£464) and advertising the new role (£281) were viewed as the biggest costs.
The report also found that on average new employees in small retail businesses, classed as companies with up to 250 workers, take 17 weeks to reach optimum productivity, compared to 28 weeks for larger retail businesses with more than 250 employees.