1. Home
  2. Frequently Asked Questions

How much can I save in Recruitment Costs?

An HRMS eliminates these inefficiencies, enabling faster, smarter, and more cost-effective hiring.

This makes an HRMS a key investment for maintaining productivity and avoiding revenue shortfalls.

Higher Cost-Per-Hire

  • Increased time spent manually posting job ads, screening resumes, and scheduling interviews.
  • Redundant efforts and wasted resources due to lack of centralized applicant tracking.
  • $5,000 saved annually.

​Missed Top Candidate Opportunities

  • Top candidates may drop out of the process due to delays or lack of timely communication.
  • Limited ability to identify and target high-quality candidates efficiently.
  • $10,333 per top candidate lost.​

Lost Productivity

Unfilled positions strain existing teams, resulting in overburdened employees, reduced productivity, and missed revenue opportunities. Additionally, managers and HR staff spend excessive time on recruitment, diverting focus from strategic initiatives.

$83,250 annual loss.

Summary
  1. Overburdened Teams: $6,250.
  2. Missed Revenue: $20,000.
  3. Recruitment Time: $1,500.

 Total Cost for 1 Unfilled Position: $27,750.
For Multiple Roles Annually:

For a company with 3 unfilled positions/year:

  • Total cost per position: $27,750.
  • 3 positions × $27,750 = $83,250 annual loss.

Administrative Costs

  • Manual communication with candidates (email, phone calls, etc.) increases workload and administrative expenses.
  • Duplication of tasks due to poor visibility into the recruitment pipeline.

Negative Employer Branding

Your recruiting process is the candidate’s first impression of your company. A clunky job portal, poor communication, delays, and inconsistent follow-ups can make your business seem unprofessional or "lame." This tarnishes your employer brand, reducing your ability to attract top talent. Negative candidate experiences often lead to bad word-of-mouth or public reviews, deterring other qualified applicants. This results in higher recruiting costs, extended time-to-fill, and missed opportunities to secure the best candidates.

$25,000 annually

Estimated Calculation:

  • Impact on Candidate Pool: A poor employer brand reduces applicant volume by up to 30%, increasing cost-per-hire by 25%.
  • Example for a 10-Hire Business:
    • Average cost-per-hire: $10,000.
    • Additional cost due to damaged employer brand: $10,000 × 25% = $2,500 per hire.
    • Total additional costs for 10 hires: $2,500 × 10 = $25,000 annually.

Increased Turnover & Bad Hires

Manual HR systems burden teams with administrative tasks, leaving little time for strategic activities like analyzing hiring decisions. Without data insights, poor hiring decisions become more frequent, increasing turnover and the associated costs of rehiring, training, and lost productivity.

  • Cost of a Bad Hire: (e.g., replacement, training, lost productivity) ÷ likelihood of a bad hire due to inefficiencies.
  • 30% of the annual salary for a $60,000 position = $18,000/bad hire. 

Compliance Risks

Tracking applicant information manually increases the likelihood of errors that violate hiring regulations, such as failing to document required equal opportunity data, mishandling sensitive information, or improper record retention. Non-compliance can lead to significant legal fines, disputes, or reputational damage, further increasing costs. Addressing compliance issues retroactively is far more expensive than preventing them upfront.

$20,000 annually

Estimated Calculation:

  • Average Fine for Non-Compliance: $10,000 per infraction.
  • Likelihood of Non-Compliance Without an HRMS: Estimated at 20% for every 50 hires.
  • Example for a 10-Hire Business:
    • 10 hires annually × 20% = 2 potential compliance infractions.
    • Cost of compliance infractions: 2 × $10,000 = $20,000 annually.

Savings with an HRMS:
An HRMS ensures compliance by automating recordkeeping, tracking applicant data accurately, and generating reports required by hiring regulations. By preventing even a single compliance infraction, businesses can save $10,000 to $20,000 annually, while reducing legal risks and maintaining a strong employer reputation.

Inability to Scale

Manual recruiting processes become increasingly inefficient as your business grows. Tracking applicants, posting jobs, and managing communications manually leads to delays, higher costs, and the inability to handle an increasing volume of hires effectively. This lack of scalability results in extended time-to-fill, overburdened HR teams, and higher cost-per-hire, compounding inefficiencies and limiting your ability to grow.

Estimated Calculation:

  • Impact of Inefficiencies: Manual recruiting increases time-to-fill by 30% and cost-per-hire by 25%.
  • Example for a Growing Business with 20 Hires Annually:
    • Average time-to-fill per role: 40 days (manual process).
    • Increased time-to-fill: 40 days × 30% = 52 days.
    • Cost of extended time-to-fill: $1,000 in lost productivity per role × 12 additional days × 20 hires = $20,000 annually.
    • Increased cost-per-hire: Average $10,000 × 25% = $2,500 extra per hire × 20 hires = $50,000 annually.

Total Annual Cost Due to Lack of Scalability: $70,000.

Savings with an HRMS:
An HRMS automates and streamlines the recruiting process, enabling your business to scale efficiently by reducing time-to-fill and cost-per-hire. With a scalable system in place, businesses can save at least $35,000 annually while maintaining the ability to hire effectively as they grow.