Employee onboarding is both an exciting and stressful process. As the first few weeks in the workplace are the most important, HR managers should make sure people stay engaged.
If you don’t take the necessary introductory steps, new hires may quit at the very beginning. We have found some interesting numbers illustrating how investing in employee onboarding can make your company even more successful.
Top Onboarding Statistics: Editor’s Choice
- Over half of employees say they didn’t have sufficient training at work.
- Around 70% of employees with excellent onboarding experience like their job.
- 20% of new hires won’t recommend their company to acquaintances.
- Only 12% of employees say their company has a great onboarding process.
- The average company expense per hire is $4,129.
- Around 20% of new hires leave within their first 45 days of employment.
Statistics on the Importance of Onboarding
The following information about employee onboarding shows how valuable and important the process is for any organization. Among the benefits are increased new hire retention, productivity, and total revenue and reduced hiring expenses and staff turnover.
1. Only 12% of employees consider their company’s onboarding program good.
Employee onboarding statistics show the majority of new hires think that their companies did an insufficient job with the process. That results in problems with productivity, work culture, and engagement.
Data also show that 58% of organizations focus on administration and paperwork. What’s more, about 33% of workers consider their introductory experience lacking formality, consistency, and structure.
2. About 59% of employees consider their workplace skills self-taught due to insufficient training.
Employee training statistics suggest that a substantial number of people didn’t acquire the skills to perform a job at their current workplace. However, there are many alternative opportunities to improve qualifications. For example, numerous universities and learning programs provide free development courses to job seekers to improve their chances.
3. Around 70% of employees, who consider their job the best possible, had exceptional onboarding experience.
Organizations should prepare an onboarding experience survey for new employees to measure the success of the recruitment experience and the introductory process. Research shows that a great onboarding experience can increase the chance of high long-term satisfaction with the job by 2.6 times.
4. About one in five hires leaves within the first 45 days in the new workplace.
New hire turnover represents the number of people who quit in the first year. The reasons for the decision vary—unmet expectations, bad work relationships, insufficient training, etc.
To calculate the new hire turnover rate, companies need to determine what period falls under that category. Then, divide the number of new hires who left during that time by the total number of employees who quit within the same period.
5. Successful employee onboarding experience can increase retention by 82%.
Companies that successfully introduce new employees to the workplace benefit from higher retention rates and productivity, onboarding research suggests.
Some of the significant challenges organizations face in 2022 are the lack of talent and high turnover. Companies can better engage their employees by encouraging flexibility, investing in technology, and providing ongoing training and mentorship.
6. One in five new hires wouldn’t recommend their workplace to friends or relatives.
Employee onboarding statistics for 2022 reveal that one in five new hires isn’t satisfied with their current employment due to a disappointing onboarding experience.
However, people’s inclination to refer increases by 93% if they’re given a chance to express their goals, get to know other team members and receive all necessary information before their first day of work.
7. Highly-effective onboarding results in 18 times more committed staff.
Numbers further indicate that 91% of people who had an effective introduction to the organization feel attached to their work. In comparison, only 29% of those with insufficient training feel the same.
Companies are recommended to streamline and extend the onboarding process into the first-year work to ensure better culture integration, benefits utilization, and long-term commitment of the new hires.
Statistics on the Employee Onboarding Process
Every company organizes different onboarding processes for new hires, depending on the industry, position, and required skills. However, many are transitioning to the virtual world, and below, you’ll find the most important recent trends.
8. The COVID-19 pandemic brought a 2,500% increase in companies investing in virtual team building.
Team building statistics indicate that organizations have adapted their activities to the global remote work shift caused by the pandemic. That includes group names, challenges, and exercises via platforms such as Zoom, Microsoft Teams, and Google Meet.
Activity types might include icebreaker questions or group fitness classes to build relationships and improve collaboration.
9. The global onboarding applications market will reach $1.35 billion by 2025.
The introductory process for new hires is often facilitated by software. Onboarding statistics in 2022 estimate this software market to expand at a CAGR of 2.5% in the next three years.
A good application allows for a smoother transition, which is why the demand for such products is growing. The top vendors include Workday, SAP, Pendo, WalkME, etc.
10. Around 60% of HR managers consider onboarding employees remotely the biggest job challenge caused by the pandemic.
Employee onboarding trends show that virtual onboarding has become the new norm. Furthermore, the process will continue to evolve—companies need to find ways of building culture and human connections remotely to make new hires feel welcome.
11. New hires complete 54 activities on average during their onboarding process.
Recent employee onboarding stats reveal employees complete over 50 activities during their onboarding. That ensures the new staff member is well-adapted to their role and understands the principles and ethics of the organization.
The average process includes three documents to sign, upload, and acknowledge and 41 administrative tasks. Employees also have to complete 10 learning goals related to the company culture, market knowledge, and role assignment.
Costs of Employee Onboarding
Introducing new staff members to the workflow is an expense for every organization. Onboarding costs include all the necessary equipment, software, and working hours dedicated to training a new employee. So, let’s see some more information about that.
12. Small European businesses spend 1.5% of labor costs on training.
The average cost of training new employees in companies with ten to 19-person staff is 2.3% of labor expenses. However, businesses in Europe are underinvesting in the process, despite it playing an essential part in one’s ability to do their job correctly.
Training in smaller organizations is more expensive and disruptive than in bigger ones. That results in insufficient work skills, motivation, and productivity.
13. On average, companies spend $1,071 per employee on training in 2021.
Large companies have the least average cost to train an employee of $722. Government and military spend the most with $1,483 and small businesses spend about $1,433. In comparison, the average expense of introducing a new hire in 2019 was $1,286.
On the other hand, the time dedicated to training has increased significantly from the previous years—from 55.4 to 64 hours annually.
14. The average cost of a bad hire, statistics show, is up to 30% of the employee’s first-year earnings.
Estimates show that an unfitting employee with a yearly pay of $80,000 can cause company losses of up to $24,000. These costs include hiring, onboarding, retention, and other paid activities.
In addition, 34% of CEOs consider bad hires to result in lost productivity, as supervisors dedicate 17% of their time to employees with insufficient skills.
15. Onboarding statistics reveal that the average cost per hire is $4,129.
Cost per hire refers to all expenses for filling a vacancy, from recruitment to onboarding. Several factors, like the hiring volume, impact each organization’s average spending.
For example, hiring more employees at once will lower the cost because they’ll simultaneously use the same resources. However, some roles require more time to fill, which extends the hiring process and leads to more expenses.
Onboarding Statistics: The Takeaway
The statistics we gathered illustrate how beneficial onboarding can be for any organization. However, many companies still fail to organize a proper introduction process for new hires, which results in high turnover rates, poor work skills, and a lack of employee referrals.
While onboarding is a time-consuming and costly endeavor, business owners need to know it’s a long-term investment. It helps people adjust to their new role and company culture and ensures motivation and commitment to its goals.
Frequently Asked Questions
How long does onboarding take?
HR professionals suggest that three months is the minimum time required for introducing new hires to the workplace practices and culture. However, onboarding should continue within the first year of employment, helping people understand their role in the company.
New employees learn about the organization and how they fit in within the first six months. Therefore, onboarding that lasts only a week or two is insufficient. Most people need a couple of months to settle in and start working independently.
Does onboarding mean you are hired?
Onboarding refers to the process of introducing new hires to the necessary skills, knowledge, and behaviors to become effective staff members. It includes the completion of the required paperwork and the cultural activities that make new hires feel welcomed.
If you’re wondering whether onboarding means you got the job, the short answer is yes. The process will help you acclimatize to your new organization and ensure you have a smooth start.
Why onboarding process matters to both employees and employers?
Onboarding is important because it adapts new employees to their role, the company’s culture, and expectations. It also helps new hires become part of the team and commit to the organizational goals.
Without a proper onboarding process, businesses have much higher employee turnover rates and loss of productivity, resulting in large sums of money lost annually. Furthermore, people who had an enjoyable onboarding are likely to stay for more years with the company.
How long does it take for a new employee to be productive?
It usually takes about eight months for new hires to reach full productivity. That’s because managers are so busy that they don’t have enough time to devote to new employees and make sure they’re up to speed.
Very few employees manage to give their best right away. Research shows new hires may take a long time to acclimate. In some cases, one to two years is needed before they’re fully productive.
How much does it cost to train a new employee?
Companies should view onboarding and training as an investment rather than an expense. The successful completion of these processes will save money in the long run if the necessary time and resources are dedicated.
The training cost per hire depends on variables such as organization size and industry, prior experience and skills of the new employee, and the complexity and length of training. According to onboarding statistics, the average sum is about $1,071.
Sources
ApolloTechnical, AppsRuntheWorld, Bamboo HR, Edume, Forbes, Inc., Leena, Sapling HR, Royle Printing, Teambuilding, Toggl, Workable, Zety