The True Cost of Understaffing

True Cost of Understaffing
“By addressing understaffing, not only do you boost morale and engagement, but decrease the risk of attrition and protect your bottom line.”

Merriam-Webster defines understaffed as “inadequately staffed.”

The Cambridge English Dictionary defines understaffed as “having fewer workers or employees than necessary.”

The Collins Dictionary is a bit wordier, defining understaffed as “a situation in which an organization does not have enough employees to do its work properly.”

Inadequate. Fewer than necessary. Not enough to do work properly. These are not terms and phrases any business would want to put in their tagline.

Yet, as the economy fluctuates and analysts debate the likelihood of a recession, many companies are doing just that: understaffing. A 2022 study found that 22 percent of workers felt they had too much work to do, while 30 percent indicated they had heavy workloads. Similar research shows that half of all workers surveyed say their company is currently understaffed.

That’s a business model every company should avoid.

Understaffing is Not Good Business

In practical terms, understaffing means that employees likely have to work longer hours and/or take on additional projects and priorities outside their job description — usually with no extra pay. The net results? Burnout, which can lead to low productivity and morale, and possibly a risk of turnover.

In the workplace, burnout stems from stress that hasn’t been managed successfully. And it is rampant.

A 2021 study from then American Psychological Association found that 79 percent of employees experience work-related stress, with nearly 60 percent of employees citing negative effects of workplace stress, including lack of motivation, energy, effort at work, and emotional exhaustion.

This toll on mental and emotional health drives many employees to either leave or to create strategies to leave. Research shows that nearly half (43 percent) of employees who cite understaffing issues have made plans to quit in the same timeframe. In fact, staff who feel their workload is unreasonable and/or are always on call are six times more likely to leave their job within six months.

And even if they don’t quit outright, many employees burnt out by understaffing simply disengage, increase sick days and days out of the office, and/or reduce their effort and productivity. This “quiet quitting” results in reduced productivity, decreased profits, and poor customer satisfaction.

Complex Issue, Simple Solution

On face value, understaffing may seem like a complex issue. Economically, companies may feel they need to run a skeleton crew to make ends meet. Yet, from a worker perspective, this short-term thinking can have long-term consequences that also negatively impact the bottom line.

Key among these is the cost of losing those employees you do have. Not only do you lose critical brain trust, but companies pay an average of six to nine months’ salary to replace an employee.

With so much on the line, employers need to approach this challenge as an opportunity to think outside the box.

First and foremost, check in with your staff. How are they feeling? What expectations do they think are reasonable and which ones do they think may need another look? What areas do they think need the most support and attention? One great way to achieve this is to have regular 1:1 meetings and direct conversations with staff to keep the lines of communication open.

For those areas that need immediate support, consider a short-term solution rather than a long-term investment. Work with a recruiting firm, such as McKinley Marketing Partners, to identify roles or projects that need support.

McKinley can help find marketing or creative services experts interested in short-term contracts or project-based work to fill the gaps in your team and relieve the pressure at a fraction of the cost of a full-time hire.

When you address understaffing openly and honestly with your team, not only do you boost morale and engagement, but decrease the risk of attrition and protect your bottom line.

Now THAT’S a business model we can all support!

by McKinley Marketing Partners