Question: In addition to improved employee retention, what are some other areas
ID: 469096 • Letter: Q
Question
Question:
In addition to improved employee retention, what are some other areas of potential economic benefit to the organization from having a Human Resource Department?What calculations would you do to prove such benefits?
Annual Turnover Rate by Category for Years One through Four:
Personnel Categories
One
Two
Three
Four
Executive (n=127)
12.8
11.5
9.2
8.3
Physician (n=367)
18.1
17.6
17.9
15.6
Other Professional (n=615)
22.6
22.1
18.3
15.6
Nonprofessional (n=804)
29.0
26.3
27.1
24.3
Totals (n=19.3)
23.8
22.3
21.3
18.8
Personnel Category
Turnover Costs
All Categories
Executive
Physician
Other Professional
Non-professional
(n=1913)
(n=127)
(n=367)
(n=615)
(n=804)
Separation Costs:
Exit Interviews
50.73
62.50
73.00
51.00
38.50
Administrative Costs
119.27
127.00
132.50
116.00
114.50
Separation Pay
348.01
2254.00
1034.00
0.00
0.00
518.01
2443.50
1239.50
167.00
153.00
Replacement Costs:
Job Advertisement
1346.49
1805.00
2416.50
1127.50
953.00
Pre-Employment Administration
353.80
405.00
416.50
386.50
291.00
Entrance Interviews
324.86
486.00
724.50
284.00
148.00
Assessment Testing
271.69
382.50
695.00
214.50
105.00
Staff Time
249.00
417.50
522.00
212.00
126.00
Travel/Moving Expenses
293.68
1215.50
1110.50
0.00
0.00
Processing New Employees
87.50
87.50
87.50
87.50
87.50
Medical Examinations
175.00
175.00
175.00
175.00
175.00
3101.50
4974.00
6147.50
2487.00
1855.50
Training Costs
Informational Literature
80.00
80.00
80.00
80.00
80.00
Formal Training
147.53
340.00
516.50
35.00
35.00
On-The-Job Training
68.15
0.00
0.00
212.00
159.50
295.68
420.00
596.50
327.00
274.50
Reduced Productivity
during Learning Period
3133.37
4000.00
6500.00
3452.00
1215.50
Total
7048.56
11837.50
14483.50
6433.00
3528.50
Department Budget per Year
Budget Cost
One
Two
Three
Four
Salaries and Benefits
110,000
233,000
288,000
324,000
Equipment and Supplies
24,000
39,000
48,000
57,000
Communications
41,000
62,000
73,000
81,000
Totals
175,000
334,000
409,000
462,000
Annual Turnover Rate by Category for Years One through Four:
Personnel Categories
One
Two
Three
Four
Executive (n=127)
12.8
11.5
9.2
8.3
Physician (n=367)
18.1
17.6
17.9
15.6
Other Professional (n=615)
22.6
22.1
18.3
15.6
Nonprofessional (n=804)
29.0
26.3
27.1
24.3
Totals (n=19.3)
23.8
22.3
21.3
18.8
Explanation / Answer
The potential economic benefits are listed below
Year 1 = 2,864,359
Year 2 = 2,722,511
Year 3 = 2,576,043
Year 4 = 2,254,679
Executive Physician Other Professional Non-professional n 127 367 615 804 Turnover rate year 1 12.8 18.1 22.6 29 year 2 11.5 17.6 22.1 26.3 year 3 9.2 17.9 18.3 27.1 year 4 8.3 15.6 15.6 24.3 Separation costs 2443.5 1239.5 167 153 Replacement costs 4974 6147.5 2487 1855.5 Training costs 420 596.5 327 274.5 Reduced Productivity during learning period 4000 6500 3452 1215.5 Total 11837.5 14483.5 6433 3498.5 Total Economic benefit year 1 192,430 962,095 894,123 815,710 2,864,359 year 2 172,887 935,518 874,341 739,765 2,722,511 year 3 138,309 951,465 724,002 762,267 2,576,043 year 4 124,779 829,209 617,182 683,509 2,254,679Related Questions
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