Disadvantages of High Vacancy Rates
1. Losing Trust: A greater number of open positions denotes a negative working environment, which can damage the reputation of the company and also restrict prospective employees before joining the company.
2. Losing Customers: Nowadays the consumer is king of the market. Thus businesses need to retain customers. If an organisation has a higher number of open positions, it indicates that it is not operating effectively, and customer service will also suffer. Therefore, companies always try to lower their vacancy rate.
3. Hiring Costs: A high vacancy rate shows that there is a need to recruit new employees which can balance the financial burden. Since hiring costs are high and cause loss for the company.
4. Overpay: With higher vacancies, the existing employees have to work more than normal. The company has to pay for their overtime which is another expense for the company.
5. Leads to Loss of Customer Confidence: If a company has open positions, it indicates can lose customer trust. With a shortage of employees, the orders won’t arrive on time. In addition, there is the possibility of making more mistakes due to frustration. This can ultimately lead to poor service which can damage customer trust, increasing the possibility of complaints. It also affects the company-customer relationship.
6. Increase in Bad Hires due to Rushing to Fill Empty Desks: A higher number of open positions sacrifices the recruitment process due to a shortage of time. Thus, with a need to get new employees into their positions quickly, quality is compromised. With this more and more undesirable employees get recruited, which can waste resources. It is a never-ending cycle.