What is the True Cost of Hiring?

As you probably have heard, interest rates have been on the rise over the past couple years—a trend that’s likely to continue at least through 2019.

As explained by USA Today, the interest rate in the US for 2018 grew by 3%, and is now expected to grow by 2.3% throughout 2019. While this growth does fall short of the numbers originally forecast, the fact remains that we’re seeing the first increase in interest rate since 2007.

But, like we said, you probably know this already. After all, the shift in interest rate has most likely impacted your personal life in at least a couple ways.

Today, though, the question is:

How does a rise in interest rates affect the cost of hiring for businesses?

Well, for starters, it basically “ups the ante,” so to speak. As we’ve discussed many times before on our blog, the cost of hiring isn’t something to be overlooked in the first place. Now, with everything becoming more expensive across the board, the cost of hiring will inevitably increase. Since you’re investing more money into each new hire, it simply means the stakes are higher for your company: if your new employee doesn’t work out, you’ll end up taking an even bigger loss than before.

Of course, the other side of this is that your hiring team will likely become more particular when interviewing potential employee candidates (knowing that a poor hire could be hugely detrimental to your organization). While this is probably the best course of action, it still means your company is investing more resources into your hiring process than you previously may have been.

Taking a step back for a moment, it’s also worth pointing out that higher interest rates may preclude you from making new hires in the first place.

Obviously, the spike is going to have an impact on pretty much every aspect of your organization, and very well may throw your previous business plan out of whack. Now, you have to deal with things like a decrease in cash flow, potential changes to loan payments, and other less-than-ideal scenarios that will leave you scrambling.

Needless to say, such times are not ideal conditions for expansion. It’s not that you wouldn’t be able to do with the help—it’s that you literally might not be able to afford to bring aboard any new hires at the current moment.

All that being said, staffing firms like The Panther Group can take on the burden of finding highly-qualified professionals to fill whatever temporary or permanent need you may have within your organization. While we work on finding the right person for the right job, you can focus on fixing up your game plan to prepare for any other potential changes that come your way due to rising interest rates.

What’s the Panther difference?

Experience, creativity, and flexibility.

If you’re looking for professional staffing solutions The Panther Group gives you options. For the past 25 years, we’ve put talented people and leading organizations together. For short-term staff or inspiring leaders, our hands-on approach to staffing ensures consistent results. Contact us today to find the talent you need to grow.