What it costs to replace someone who quits in month five, counted honestly

An employee starts in January and resigns in June. The immediate cost that gets discussed is the job posting. That is the smallest line on the list, and it distracts from a total that is usually several months of the role's salary.

Counted properly, the cost falls into four buckets, and only one of them shows up as an invoice.

Bucket one: what you already spent and did not get back

Everything invested in getting this person productive is written off on the day they leave.

• Recruiting time: writing the ad, screening, interviewing, checking references. Count the hours of everyone involved, at their actual cost.
• Onboarding: paperwork, equipment, accounts, training materials.
• Supervised time. A new person's first weeks consume someone else's hours as well as their own, and that someone is usually your most experienced person.
• Any signing incentive, relocation, or training course paid for.

The uncomfortable part of this bucket is that it is largely fixed. Replacing them means paying all of it again.

Bucket two: the productivity gap

This is the biggest number and the one that never appears in an account.

A new hire in most skilled roles reaches full productivity somewhere between three and nine months in, depending on the complexity of the work. Someone who leaves in month five was still climbing. You paid a full wage for a partial contribution, then lost the part where it turns positive.

Then the seat is empty. During the vacancy the work is either not done, done by someone else at the expense of their own work, or done by overtime. All three have prices, and the second one is the one that quietly damages the rest of the team.

Then the replacement starts, and the ramp begins again from zero.

Bucket three: the effects nobody assigns to it

• Customer relationships. In any role with an external contact, five months was long enough to become the person a customer asks for. The reintroduction costs goodwill.
• Knowledge that never got written down. Five months of small operational fixes, workarounds and account details leaving with one person.
• Errors during coverage. Work performed by people doing two jobs at once has a higher error rate, and the errors surface later.
• Morale and contagion. Departures cluster. A resignation prompts other people to look, and the ones with the most options look first.

Bucket four: what the second search costs more than the first

Rehiring for the same role within months is harder, not easier.

The pool has been used. Strong candidates from the first round have taken other jobs. Anyone who noticed the same role posted twice in six months will ask why, and the honest answer is a difficult sell. The pressure to fill quickly is higher because the seat is already empty, and hiring under time pressure is how the next early departure gets made.

Where the money actually goes wrong

Early departures cluster around a small number of causes, and most of them are decided before the person starts.

1. The job was not the job described. Hours, duties, or the amount of a task the ad mentioned in passing.
2. The pay was below the market and they found out. Usually within weeks, from a colleague or a job board.
3. Nobody trained them. A person left to figure it out concludes they are failing, and leaves before anyone tells them otherwise.
4. No visible path. Not necessarily promotion. Just a clear answer to what next year looks like.
5. A manager problem that predated them. If the role has turned over repeatedly, the role is not the variable.

Labor turnover across industries is tracked by the Bureau of Labor Statistics, and comparing your own separation pattern against the general shape for your sector is a useful reality check before concluding you have a hiring problem rather than a retention one.

What actually reduces it

The interventions that work are small and early, which is convenient, because they are also cheap.

• Describe the job accurately in the ad, including the parts people dislike. Candidates who accept anyway do not resign over them.
• Check pay against the market annually, not when someone resigns. A counteroffer is the most expensive way to discover a range is wrong.
• Name one person responsible for training, and give them the time to do it.
• Hold the thirty and sixty day conversations. Most early resignations are visible weeks before they happen.
• Ask departing employees what happened, and ask a month after they leave rather than on the last day. The answers differ.

Set against a replacement cost measured in months of salary, an hour a month spent on those five is one of the highest-return uses of a small employer's time available.