What it costs to lose a technician
Most of this cost never appears on an invoice, which is why it gets ignored until it is measured. Here is how to measure it with numbers you already have.
No borrowed statistics on this page. Every figure is either arithmetic you can check yourself or a clearly marked example, because the numbers that matter are the ones from your own shop.
Why a borrowed statistic will not help you
You can find figures claiming a departure costs some multiple of salary. Those numbers come from industries that are not yours, at scales that are not yours, and quoting one at your own shop tells you nothing you can act on.
The cost of losing one of your technicians is a number you can work out in about ten minutes, and yours will be more useful than any study. Below are the five parts.
The five parts
1. The vacancy
From the day they leave to the day somebody replaces them, that work either does not happen or gets absorbed. If it does not happen, the cost is the revenue those jobs would have produced. If it gets absorbed, see the next two.
2. The overtime and the strain
Someone covers. Usually your best remaining person, usually at premium rates, usually on top of a full schedule. Count the overtime hours honestly, and note that this is also the mechanism by which one departure turns into two.
3. Recruiting and hiring
Job postings, your own hours spent screening and interviewing, any agency fee, background checks, and the administrative work of onboarding. Your time counts here even though nobody invoices you for it.
4. The ramp
This is the part most often left out and frequently the largest. A new technician is paid in full from day one and productive in full considerably later. They work slower, need a second opinion, and someone experienced stops what they are doing to give it. The cost is the gap between what you pay and what you get, for however many months that gap lasts.
5. The customers
Hardest to quantify, and real. Customers who asked for that person by name. Accounts where the relationship was with them rather than with your shop. Jobs that came back because the work was rushed. You will know whether this applies to you.
Work out your own number
A worked example — substitute your figures
A technician on roughly $30 an hour, full-time. Say the seat is empty for six weeks, and the replacement takes three months to reach full speed.
- Vacancy: six weeks of that person’s output, either lost or absorbed.
- Overtime: the premium above normal rate on whatever hours got covered, for those six weeks.
- Recruiting: postings, plus your own hours screening and interviewing, valued at what your time is actually worth.
- Ramp: if the new hire is at roughly half speed for three months, that is about six weeks of paid time you did not get work for — before counting the experienced person interrupted to help.
- Customers: any accounts you actually lost.
Add them. For most shops the total lands somewhere between one and several months of that person’s fully loaded pay — and the ramp and overtime lines are usually larger than the recruiting line people assume is the main cost.
Then compare it to what keeping them would cost
Once you have your number, a retention bonus stops being a soft idea and becomes arithmetic. If one departure costs you several thousand dollars and a bonus is a fraction of that spread across two years, the question is only whether it changes enough decisions to be worth it.
Worth noting: the money is not spent unless the person stays. Somebody who leaves early keeps only what they earned and forfeits the rest — so the cost lands in the case where it worked. That mechanism is explained here.
The part that decides whether it works
A bonus only changes behaviour if the person knows the number. A promise mentioned once at a hire and never seen again is not competing with a concrete offer from the shop down the road eight months later.
Whatever you use to track it, the thing that matters is that your technician can look at the balance whenever they want, and see what walking away would cost them. That is the number doing the work. See how that looks.
Vestly keeps the record, so the promise is believable.
Set the terms once. Your crew logs in and sees what they have earned, and what they would leave behind.