The Financial Considerations of Hiring New Employees

As you grow your business, you take on new challenges and clients. You’re always looking to expand your level of production. And as you grow, you’re going to need more employees. Sounds simple, right? But expanding your business doesn’t always mean that you need to hire new employees. In fact, if you look closely at the financial considerations of making a new hire (or hires), you’ll start to see that hiring new employees might actually keep your business from growing.

For example, wages are the first thing that comes to mind when you calculate the cost of a new employee. But what about health insurance? Paid vacations? Payroll tax? Worker’s compensation? When you balance the total associated costs against the potential benefit a new employee will bring to your company, it quickly becomes apparent that it’s not as cut and dry as it appears.

On the one hand, an additional employee should allow you to increase your overall production. On the other hand, you are also adding to your ongoing fixed costs and increasing your overall budget, even in seemingly unrelated departments (such as additional hours for HR staff to process paperwork). Even hiring someone for what appears to be a part-time position may be more costly than anticipated. Many states consider someone who works 30 hours a week to be full-time, which increases your exposure to the benefits an employee is entitled to, including unemployment compensation and insurance coverage under Obamacare.

With all of this in mind, you may begin to feel like it makes sense to turn down potential jobs or clients simply to avoid the headache of adding employees. And that’s where FRS comes in. Our dedicated team functions as your on-demand labor force without ever adding to your fixed costs or long-term overhead. We give you the confidence to grow and expand your business, to take on new projects and to always be looking for new opportunities, knowing that FRS can handle the labor logistics in a timely, professional and, most importantly, cost-effective manner. Get in touch with us today and let’s get started building a dynamic and productive partnership!

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