As a company grows and demands change and evolve, roles and responsibilities will also change and the need for new employees will present itself. But for higher-level roles, should you look outward and recruit fresh talent or fill positions from within your company?
There are several benefits to hiring someone from an outside source, such as getting a new perspective on business directions and needs. But there are also a variety of positive reasons to promote from within instead.
Here are 10 reasons why you should consider promoting from within.
It’s Expected: Younger employees are expecting to be considered for promotions in order to stay with the same company. A recent Gallup report on the millennial generation reveals that 21 percent of millennials say they’ve changed jobs within the past year–that’s three times the number of non-millennials who report the same. And since replacing an employee costs more than to train and keep current employees, deciding to promote from within could help your company save money over time.
Turnover: Millennials and younger employees also expect pay raises as well. Not only are companies losing money to turnover, but more than one-third of employees plan to quit their job if they are not given a pay raise within a year.
Another Company’s Treasure: Younger employees are becoming more confident in the job market and their position in finding a new role when they want. Most employees leave their employer when they change positions, finding a promotion at a new company, potentially with a competitor.
More Retention: When employees are motivated to work for promotions, raises and bonuses, they end up staying at a company for longer. This boosts retention rates and keeps a company from losing out on grassroots talent and keeps them from turnover issues.
Increases Motivation: When a candidate for an internal promotion is provided goals and the resources to meet them, they are going to be more motivated and driven to engage in their work.
Career Development: A major reason why people leave a job is due to lack of career development and potential opportunities within the same company. Candidates end up seeking out a company that is proven to offer development, which may be a company’s competition.
Costing Less: On average, when an external candidate is hired, a company pays nearly 20 percent more than if they were to have promoted from within. Instead of paying a new employee premium rates, it can be better to promote internal candidates who are already on track to learn and grow.
Loyal Employees: External hires are more likely to be fired, laid off or quit in the long run, compared to employees who have been with a company for some time already. External hire success stories are out there but promoting from within can keep workers engaged and loyal to the same company.
Cut Down on General Liability: Depending on the job type and work environment, general liability issues can increase or decrease based on who’s in charge. If you hire someone externally, they may not know how your company goes about certain workplace risks, which only raises the need for General Liability insurance. And while having General Liability insurance is a must, it’s better to rely on internal employees who know how to avoid business-related risks already.
Better Job Transitions: Almost all current employees will know the team they’ll be working with in the higher role as well as the client base they serve compared to external candidates. When you promote from within, this eliminates the need for more intense training, someone slowly getting used to a role, a company’s culture, client expectations and relationships, and working with coworkers.
About Byrnes Agency
At Byrnes Agency, we offer insurance solutions that can be tailored to meet your specific needs. Whether you’re looking for personal policies or commercial coverage, we have the right coverage for you. To learn more about our products, contact us today at one of our two locations.
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