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Well, I'm looking at it like this, in my own viewpoint: So what I am saying is that one has to have real actual dollars to pay. So if a business makes $100,000
by As_You_Wish 4y ago
Well, I'm looking at it like this, in my own viewpoint:
So what I am saying is that one has to have real actual dollars to pay. So if a business makes $100,000 per year, and out of that is rent, utilities,etc, but not including the hiring expense, you have 15% profit margin, or $15,000 left over. So if hiring a person costs $2,000, then you lower your profit margins to $13,000, or 13%. So to keep the profit margin at 15% you have to make extra sales to cover that hiring expense. This is the same with all expenses, but I'm only focusing on the hiring expense. What I'm saying is that for each expense, extra income has to be generated to cover the expenses and hopefully get a profit margin that is acceptable. There's a cost to each dollar earned. You can't operate a business without a profit, and the more the profit the better, and the best is to protect profit margins. But as I said in my original post, I'm not getting technical and/or exact. I'm giving the overall view on it.
>>Employee decides the job is not a good fit for him or her and quits 9 months later: $90,000 wasted.
>Interesting philosophy. By extension, if the employee decides the job is not a good fit and quits after 240 months, you just wasted $2,400,000.
Amortization. Buy a car for $100,000 and keep it for a month and you wreck it (without it being insured), then that car costs you $100,000 per month, if you just drove it out of the lot and wreck it .25 miles after purchase. If you keep it 100,000 months, and you wreck it on the 100,000th month, then it costs you a dollar (ignoring MACRS for kicks).
Point being that after only 9 months, a company would not have got full value out of the hire because of the learning process, but hopefully after 240 months (20 years), a company should have had that employee up and running, but if not, that's yet another hiring/firing error.
Long and short of it in my opinion: You are taking this WAY too seriously. The point is that companies take a long, long time to hire someone because it is super expensive to make a mistake, in cash. I didn't even mention the morale issue of hiring a suck employee and other non-tangible costs. Do you agree with that or not? All the other stuff is just quibbling.