While alternative methods for recruiting qualified accounting and finance professionals have surfaced, so have new
methods for ensuring retention. The 2007 Accountants Inc. Compensation Benefits and Workplace Trends Guide revealed
that 59% of those surveyed expressed some level of concern about retaining their staff. Research conducted by the Institute
of Management and Administration (IOMA) found that 83% of HR professionals at U.S. companies have expressed concern
about both retention and recruitment. “Retention is always important because of the investment you make in people,” says
Gerald Shields, CIO of American Family Life Assurance.

Employee turnover is very costly. Salary.com estimates that replacement costs range from nearly 29% of an employee’s
salary to even higher, while the U.S. Department of Labor Statistics estimates that the average cost to replace an employee
in private industry is $13,996. When you include intangible costs such as a new employee’s inefficiencies and the lost
productivity while the job was vacant, the costs could be even higher. “The cost of a mis-hire, depending on level of income,
could be up to 28 times the person’s salary,” states Bradford T. Smart, author of Topgrading.

Companies are realizing that retention should be assessed as early as the recruitment process. According to research
conducted by Mei-Chuan Kung and Matthew O’Connell, authors of “The Cost of Employee Turnover,” companies using prehire
personality tests and behavioral interviewing techniques are able to evaluate if a candidate is more likely to be an
engaged, long-lasting employee. Another practice used to gauge retention has some employers profiling their company
“personalities” and core competencies needed for specific roles to help ensure that candidate’s values and preferences can
be matched to the company culture.

Taking the time to recruit the employee who will be long-lasting and engaged can save organizations the increasing costs of
replacing employees who leave, as well as the resulting loss of productivity and overall morale. “A good system of hiring
often can eliminate nearly all performance related turnover,” states David Hyatt of CorVirtus. By paying attention to a
candidate’s likelihood of being a long-lasting employee from the recruitment stages, companies have a better chance of
retaining their accounting and finance staff for the future.

This information represents only a sample of the topics that this year’s Accountants Inc. Compensation, Benefits and
Workplace Trends Guide focuses on, in addition to our traditional compensation portion that supplies salary ranges from the executive to support positions throughout the nation. For more information on staffing related trends and to receive a
complimentary copy of this year’s Guide, contact your local Accountants Inc. representative today.