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Home / Medien / 5 ways to reduce your cost per hire with elearning

5 ways to reduce your cost per hire with elearning


If your cost per hire doesn't take into account the cost of bringing a new employee up to optimum productivity you’re ignoring the biggest expense of taking on new staff.

Oxford Economics report that the total cost of hiring someone new is just over £30,000 with more than £25,000 of that total represented by the cost of lost output while a new employee reaches optimum productivity.

If you’re a HR professional looking to reduce these costs, we've got five tips to help you achieve your goal. During this post we’ll shed some light on the problem and show you how elearning can help speed up the time to productivity significantly.

Where do the costs come from?

There are many factors that affect these costs, and some can be managed better than others.

Some factors will affect all new employees, and others will be specific to one group. It’s important to know these differences when you’re creating a strategy to reduce the costs.

The main areas to consider when finding ways to minimise these costs are:

Business factors

  • Sector – highly skilled employees are more expensive to bring up to speed and this difference is reflected in industry variance for costs
  • Size – small businesses have lower productivity costs than larger organisations

Employee factors

  • Relevant experience – if a worker is currently in the same sector it’s a big advantage in time to productivity
  • Current employment situation – new starters who are unemployed fare worse and graduates take longer than workers from other businesses to get trained up

How can I reduce these costs?

There are two main ways to reduce these costs: cut the time it takes to reach optimum productivity, or change your new starters’ path to productivity.

A graph from the Oxford Economics Report shows how new starters who learn faster at the start reduce costs by having a higher total productivity over the same period than slow starters

A new employee who starts fast and finishes slow on this path will cost you less than a steady or slow starter, despite taking the same time overall.

5 ways elearning can help

Creating or improving an induction or onboarding strategy is one of the best ways you can reduce your cost per hire.

Here are 5 clear ways that an elearning model can help reduce your cost per hire:

  1. Pre-boarding - start induction before day one for a boost in productivity

An online elearning programme is the easiest way to offer pre-induction or pre-boarding training to employees. Using a cloud based LMS means elearning can be made accessible to new starters from anywhere.

A new employee who is coming directly from employment in the same sector tends to improve productivity fast at the start of their new role and more slowly as they approach optimum.

If you identify which type of employee you’re likely to be hiring you’ll be able to cater to their needs better. If you start early enough you could give an industry newcomer some of the key skills that they lack and take a shortcut to fast progress.

Pre-boarding or pre-induction is becoming more and more popular, especially amongst industry leading companies.

These pre-boarding statistics from the Aberdeen Group show its potential:

  • Best in class companies are 35% more likely to begin onboarding before day one
  • Top companies are 18% more likely to provide information on the company’s norms, etiquette and values to new hires

Moving the basic but essential elements of induction into a package that can be completed before day one gives you more time to focus on individual needs of new starters.

  1. Video - give new starters the chance to hear from high level managers quickly and easily

Using video of the top management team as part of an induction process will help new starters identify with the heads of the business. The people who set the company culture and values are often the best people to share them.

Learning the culture of the organisation and having the ability to ask questions about a specific role to the people in charge accelerates the progress of new employees. But often it’s not possible to get one-on-one time with the high level management of a larger company.

Innovative techniques like branching scenarios with interactive video can help create a unique path for each job role to discover the most relevant information from busy managers.

  1. Elearning games - allow new employees to experience real scenarios before they happen for a short-cut to experience

A report by the Elearning Guild shows that games and gamification has a real impact on skill-based knowledge assessments with a 14% increase in performance when game elements are used. New skills are a large part of new starters’ learning so improving training in this area has a real impact on speed to productivity.

Gamification elements can be built into the LMS, with elearning tracking feeding into them as your employee takes the training. These clear markers of progression help motivate employees to develop new skills through competition and collaboration with peers.

Incorporating serious games and simulations allows new employees to experience the scenarios that they haven’t had the chance to in real life. Giving a new starter this realistic environment in which to fail safely gives them the confidence to act decisively when the real situation arises.

  1. Tracking - monitor performance and progress to help identify learners needs more quickly

Having your new staff’s results and progress available is invaluable when creating a plan for their development. Using elearning in an LMS (Learning Management System) makes this data collection straightforward.

An employee engagement study by Blessingwhite shows that 24% of employees would be more engaged at work if they were given the opportunity to do what they do best. Tracking which training themes new employees are returning to enables managers to give them these opportunities as soon as they start.

Tracking your new starters’ progress is critical to keeping them moving at the right pace. Combining tracking with frequent reviews gives management the opportunity to guide people onto the right track whilst identifying potential stand out talent.

  1. Self-paced learning - capitalise on new starters existing skills to speed up their path through training

Elearning allows ultimate flexibility for learners to take courses on demand, not only will new starters be able to take control of the speed at which they consume courses but they will be able to revisit the modules that matter most for their role.

Self-paced learning can help accelerate the progress of exceptional employees. Allowing new staff to go at their own pace means they can concentrate on the areas that they need the most work on and breeze through the subjects they are familiar with.

There are many other benefits of induction elearning beyond reducing time to productivity, we have a produced a free guide on how to integrate elearning into your induction or onboarding programme that's available here.