£40k per head is the true cost of legal recruitment, says Oxford Economics.
Why does the cost of replacing a staff member reach into the tens of thousands of pounds? It isn’t only the obvious costs that need to be accounted for; hidden costs caused by the upheaval of someone leaving contribute significantly. Staff turnover and high attrition rates add to this figure and if firms allow turnover rates to creep up, they can find themselves in a cycle of processing leavers and sourcing candidates.
Lynn Sedgwick, Managing Director of Clayton Legal, comments,
It’s sometimes easy to overlook everything that a firm puts into replacing a skilled legal professional. Of course, there are the obvious things like job advertisements, but there are also plenty of other things that impact on the firm, even if they don’t immediately seem to have a monetary cost attached to them; disruption, lost opportunity and client loss, and also not ignoring the management time lost in the process. When one person leaves it creates a ripple effect across the firm. Colleagues find themselves under greater pressure, management is busy with arranging cover and HR have a job on their hands to find a replacement.”
It’s these hidden costs that add up. According to Oxford Economics, the cost of replacing one legal professional is £39,887. One of the most important reasons given for this figure is the loss of productivity while a new recruit gets up to speed. This helps explain why the impact of staff turnover goes beyond only the financial element. And while a replacement can ease the pressure, it’s not an overnight fix. The Oxford Economics report states that the legal profession has one of the longest bedding-in periods, with new joiners taking up to 32 weeks to get fully up to speed.
What can law firms do?
Lynn Sedgwick, says,
The true cost of recruitment can be a shock. The best thing that firms can do is try to decrease turnover rates and reduce attrition amongst trainees and newly qualified staff. If firms can recruit carefully and then retain those staff, they put themselves in a much better position in the long term. It’s difficult when you’re dealing with client demands, winning new business and all of the other things that require attention. A recruitment partner that is able to handle the specialist demands of the legal sector can be a big help, not only in recruiting staff but retaining them also.