A friend and I have been having Spontaneous Entrepreneurial Seizures (that means we want to start a small sideline business).
This afternoon, I was going through an online checklist of things to consider before taking a large step like this one. One of the items was employees. Where are you going to find them? What are you looking for? How much will you have to pay to attract the talent you need?
Without even thinking about it, I made a note to myself to call a couple of Temp Services on Monday.
Temp Services? What the heck?
1) Temp employees cost anywhere from 50% to 100% per hour more than the same employee is willing to work for as a permanent employee.
2) The temp will leave you at the drop of a hat if he finds something better (and he often has the temp service in his corner working to achieve that objective.)
3) My "keep to hire" rate with temps is somewhere below 2%, and I bet I've worked with more than 100 this year alone. I spend a lot of time re-training.
4) My "keep for the lifetime of the project" rate with temps is somewhere below 25%. Many of those guys are not invited back to work the next day. Some don't even last until the first 15 minute break.
So why in the world would anyone hire a temp, instead of hiring the worker outright?
1) The employer doesn't have to mess with tax witholding (income tax withholding has been a temporary wartime measure since 1943). I don't want to be in charge of paying anyone's taxes for them. It is totally insane.
2) If I hire an employee who doesn't work out, he or she can sue me for a large number of real or imaginary offenses should I end the work relationship. It is totally insane.
5) Then there's the gloriously mis-named Employee Free Choice Act, which would do away with secret ballots in unionization votes. It's totally insane.
6) In all of our conversations about starting this little sideline, we haven't had a single conversation about "Saving And Creating Jobs". Not a single one. We've only talked about creating something that people will value more highly than the amount it will cost us to produce it. Can you imagine us pitching our idea to a legit bank or investor and starting the conversation with "We've come up with a way to create 50 jobs ! ! !"
No, if we want to be taken seriously, we'll have to walk in the door with a scheme that involves fewer people, not more. The current bunch of Thieves & Looters in D.C. seem to reward people for taking the opposite approach, don't they?
So until that mindset changes, I don't see us hiring anything but short-term temps. The current political mess it totally insane.
7) All businesses are forced to pay into an Unemployment Compensation Fund. The amount you are charged depends on the number of people you release back into the marketplace without just cause. I don't want to go through a demeaning song and dance of finding reasons to fire someone who hasn't done anything wrong, when I could pay a bit extra and have the problem taken out of my hands. The mess my employer goes through in Human Resources is....totally insane.
That's the way I see it right now, on 10-10-2010. I could change my mind tomorrow. Temp Services rule ! !
OK, Next question: Why aren't more businesses hiring?
Fresh coats of Whitening to here and here and here and here for the pics.