In 2020, the average professional hire takes 77 days to fill.
So you have a position that has gone unfilled for a while now. Maybe it's because there wasn't an immediate need to replace someone. Maybe it's because your internal process is a little lengthy and is still ongoing. Or maybe it's because you just can't find the right talent for the vacancy. Either way, it's no surprise that vacancies have a direct cost and are harmful to the organization.
Average revenue per lost employee: There isn't a cookie cutter formula, but if you don’t have data specific to a position (Director of HR vs. Senior Manager), you can “guesstimate” using the following equation. Take the company’s revenue per employee (total revenue divided by number of employees) and divide by 12 months. The resulting number will be the average revenue produced by that employee monthly. Without this employee, the company isn’t generating that amount.
Revenue lost (i.e. for a sales role): Take the average yearly revenue produced by the individual in the job and divide it by 12 months. Now multiply that number by whatever your profit margin is and you'll have the monthly profit that will be lost if no one is in the position.
Download our cost calculator for a very detailed way to estimate the cost of your vacancy.