Laying off employees is never easy, but it’s sometimes inevitable. When companies are forced to let go of workers, they have an obligation to help those individuals find a new job, either within the company or with another organization. This is where outplacement services come in. Outplacement services provide support to displaced employees to help them find new jobs. While these services can benefit both the company and the affected employees, they do come at a cost.
In this article, we’ll explore outplacement costs, so you can better understand what to expect if you are considering this service.
##The Basics of Outplacement Services
Outplacement services are provided by specialized companies that offer support to employees who have been laid off. They typically include a range of services, such as career coaching, job search assistance, resume and cover letter development, interview preparation, and networking advice.
The goal of outplacement services is to help displaced employees find new jobs as quickly as possible. This not only benefits the employees themselves but can also enhance the reputation of the former employer and improve morale among remaining employees who see that the company is taking care of their former colleagues.
##How Much Do Outplacement Services Cost?
Outplacement costs can vary depending on several factors, including the size of the company and the level of service provided. Some companies offer outplacement services as part of a severance package, while others may require employees to pay for these services themselves.
According to the 2020 CareerArc Outplacement and Career Transition Industry Report, the average cost of outplacement services is about $5,000 per employee. However, this can range from a few hundred dollars to over $20,000 per employee depending on the level of service provided and the duration of the program.
##Factors that Impact outplacement costs
As noted, several factors can affect the cost of outplacement services. Here are some of the main factors to consider:
1. **Level of Service:** Outplacement services can range from basic job search assistance to more comprehensive support that includes access to career coaches, resume writers, and other specialists. The more services provided, the higher the cost is likely to be.
2. **Duration of the Program:** Some outplacement programs are short-term, while others can last for several months. The longer the duration of the program, the higher the cost is likely to be.
3. **Company Size:** Companies that need to provide outplacement services to a large number of employees will pay more than companies that only need to assist a few displaced workers.
4. **Geographic Location:** Outplacement services can be more expensive in areas with a high cost of living or where there is intense competition for jobs.
5. **Industry:** Some outplacement providers may specialize in specific industries or professions, and prices may vary accordingly.
##The Benefits of Providing Outplacement Services
While outplacement services do come at a cost, there are also many benefits to providing them. Here are a few of the main advantages:
1. **Protecting the Company Brand:** If employees feel that they have been treated unfairly or neglected during the layoff process, they are more likely to spread negative reviews about the company. Providing outplacement services can help alleviate these issues and protect the company’s reputation.
2. **Boosting Employee Morale:** Providing outplacement services demonstrates that the company cares about the wellbeing of its employees. This can boost morale for remaining staff and encourage loyalty to the company.
3. **Attracting New Talent:** Companies that provide outplacement services may be viewed more favorably by job seekers, which can help attract new talent and make the hiring process easier.
4. **Complying with Legal Requirements:** In some cases, companies may be required to provide outplacement services as part of a severance agreement or as mandated by law.
##Making the Decision to Invest in Outplacement Services
If you are considering investing in outplacement services for your company, there are several factors to consider. First, assess the likely cost and determine whether it is within your budget. Then, evaluate the level of service your employees will need and the length of time they may require assistance. Finally, consider the relative benefits of providing outplacement services against the cost and assess whether it is worth the investment.
While outplacement services come at a cost, they can provide significant benefits to both the affected employees and the company as a whole. By investing in these services, companies can show that they value their employees and are committed to their wellbeing.