When to Hire: The Cost of Hiring vs. the Cost of NOT Hiring

You’re starting to feel that itch.  Maybe you’ve been working nonstop at your own one-man startup.  Maybe you want to grow your small business’ revenue but can’t find the time to make those extra sales.  Maybe your employees are starting to grumble about being overworked or not having enough time for every project.  Whatever the reason, you’re starting to think about making a hire.  But how do you move past that foggy inclination of “yeah, having some extra help would be great” to determining that a new hire is the right move for your company?  After all, bringing in someone you don’t really need will just cost money, potentially tens of thousands of dollars, and that’s something a small business can’t afford.  To boot, hiring someone can be a long, time-consuming process that sometimes still yields frustrating results.  Should you commit?

There are two main questions to consider when you’re deciding whether or not to make a hire: the cost of hiring and the cost of not hiring.

The first step in addressing the cost of hiring someone is identifying why you’re thinking about hiring in the first place.  Is your team asking for someone to help with the growing workload?  Do you need someone to help with day-to-day tasks so you can focus on the big picture?  Do you need someone full-time, part-time, or just for a temporary project?  Take the time to make a list of the problems you’d want a new hire to solve and then examine each one.  Could it be resolved by making a process more efficient?  Could this task be re-delegated so one employee isn’t so overwhelmed?  Making sure your current team is operating efficiently could save you a lot of time and money if it means you don’t need to bring in a new hire after all.

The second step is addressing the cost of hiring is to actually address the monetary cost.  Can you afford a new hire?  Take a look at how much a new employee would cost (salary, benefits, etc) compared with how much more revenue they could bring in (either themselves or by freeing up time for others).  Run the numbers, do the math, whatever you need to do to make sure you are financially good-to-go.  Hiring an employee is making a long-term commitment to them and if ultimately they are going to cost more than you’re going to gain, it’s time to rethink your options.

Temporary or part-time employees are worthwhile alternatives to explore.  Temporary help isn’t tethered to a long-term commitment and could work well if you need the extra hand on one project (maybe organizing all your spreadsheets or assisting with a sales push).   If a temp hire is successful, you might also have the option to arrange a long-term contract.

Like a temp hire, part-time employees save a considerable amount of money and might be all you need to pick up the slack of your current team.  Hiring someone for 5, 10, or 20 hours a week could be an effective way to make your company more productive, without the extra costs that come with a full-time hire.

The last cost of hiring to think about is simply the time needed to hire a great person.  Drafting a job posting, distributing it to high-traffic job boards, reviewing applications, interviewing, reference-checking, and repeat … it’s not a process that gets done in a day or even a week.  Luckily, there are great tools like CareerPlug’s Applicant Tracking System that make this process easier than ever, but it’s still a process you have to make time for and commit to seeing through.

Now for the flipside: what will it cost you not to make a hire?  Well, this could be measured in small costs.  Maybe you fall behind on some spreadsheets or keep working ten or twenty extra hours a week to keep up.  Maybe your team looks a little more stressed than usual during busy weeks.  But the cost of not hiring could also mean losing potential business because you don’t have enough hours in the day, or watching your quality of service drop despite your efforts.  It could mean having trouble retaining the employees you do have because they feel overstressed and overworked.  A recent study found that more than half of employees identified inadequate staffing as a top cause of stress.  Think about what would happen if you didn’t make a hire?  How does this cost compare to the cost of hiring someone?

Sometimes you might end up in the dreaded Catch 22.   Your cost-benefit analysis is telling you that now isn’t the right time to make a hire, but not adding to your team is keeping you from expanding your business and consequently letting your competitors have the advantage.  In these cases you’ll have to take a hard look at what you want for your company long-term and often re-strategize to stay in the game.

If the decision is to hire: congratulations!  Hiring a great employee can be incredibly rewarding and help make your business more successful than ever.  If this is your first hire, be sure to check out these steps to make sure you’re taking care of the legal requirements.  And remember – you’re not alone! Do your research and use the resources available to you to make your hiring process successful.  Good luck!

Remember to follow us @CareerPlug for more Hiring and Recruiting tips.

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Kacie was born and raised in Houston, Texas, and graduated from The University of Texas at Austin in 2012 with a degree in Anthropology.

Kacie joined CareerPlug as an intern while still in college in 2012. Post-graduation, she joined the CareerPlug team full-time as a Talent Specialist on the Recruitment Services side of the business, eventually working her way up to be the Recruitment Services Manager. From there, she learned her passion for the internal processes of what makes the business tick and explored other roles at the company, including Internal Support, Implementation, and Quality Management, before eventually finding her home in Design. She is now building a Creative Design branch off of the Marketing team.

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Native to Texas, Jenny graduated from the University of Texas at Austin in 2004 and joined CareerPlug in 2017. She retired her first career path as a Registered Dietitian after 10 years, and has found her true belonging in business operations.

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Use our templates to create an attractive careers page and job posting. Then promote it through our job board partners, as well as directly with your employees, customers, and social network.



Use our notifications and automations to be the first to respond to qualified applicants. Send texts and emails from directly from CareerPlug to convert applicants to scheduled interviews.



Use our prescreen questions and assessments to identify the best applicants. Then use our interview questions and scorecards to evaluate for the right things consistently.



Once you think you have found the right person, use our reference and background check resources to verify them. Then, send an electronic offer letter from CareerPlug to close the deal!



Hiring is hard, but partnering with us makes it easier. From posting jobs to scheduling interviews, CareerPlug allows you to automate certain parts of the process to improve your results and save you time.


Polly Schandorf

Engineering Manager

Joe Lepis

Engineering Manager

Clint Smith

Founder & CEO

Clint founded CareerPlug in 2007 with the simple idea that there was a better way to help employers connect with quality applicants. Today Clint works every day to fulfill CareerPlug’s mission: Make Hiring Easier. Leading by example, Clint loves spending his time developing new ideas and teaching others.

After graduating from the University of Florida, Clint worked in investment banking and strategic marketing; both experiences influenced the development of CareerPlug. He also spent a year away from the business world teaching 5th grade in Boulder.

Clint is passionate about helping others succeed and is involved in numerous mentoring programs. He and his wife, Sarah, are also foster parents. Clint enjoys family time, beach volleyball, and outdoor adventures.