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With all this talk of a recession, companies are considering how to tighten their belts and cut costs. Layoffs are often synonymous with recessions, but that isn’t always the best approach. Even though you may think you’re saving money from additional compensation packages, understaffing can be even more detrimental to your bottom line. When you’re not fully staffed, productivity and employee satisfaction are negatively impacted. This will cost you more money in the long run. Here are the ways understaffing costs your organization.

Avoid Costly Understaffing Mistakes

Increased Employee Burnout

When you reduce your headcount to save money, you’re placing the burden of production on only a few people. This increases the effects of workplace stress and, in the end, could lead to massive employee burnout. Your employees aren’t machines, and not providing a good balance between work and home life is problematic. Maintaining substantial staffing numbers can be far more cost-effective than losing key team members to burnout.

Shift in Workplace Dynamics

When your organization is understaffed, you may also encounter workplace dynamics challenges. The employees left may have difficulties with management and each other. You may find that you’re feeding into cliques or even bullying or harassment situations when you create a hunger-games-style environment for your employees to keep their jobs at all costs.

Missed Opportunities

Fewer employees can also mean fewer resources for your clients. When you miss out on opportunities for business because you let part of your team go, you lose out on that potential revenue. Reducing your workforce can mean you can’t perform optimally, and the business opportunities will go to your competitors.

Skyrocketing Workplace Stress

The pandemic shed light on an even more significant concern plaguing workers. Workplace stress is a leading cause of heart disease and stroke, and left unchecked could be a massive epidemic. We didn’t talk about workplace stress for long, leaving employees to struggle with mental health independently, even if their employment caused some stress. Skyrocketing workplace stress can impact performance and retention.

Product or Service Quality

Of course, it’s important to note that understaffed departments and companies often see a deterioration in product or service quality. Overworked employees can overlook essential steps. Not because they’re not competent at their job but because they can’t handle the mental workload expected without additional support. When this begins to affect your clients and customers, it can mean big problems for the future success of your company.

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About Anserteam Workforce Solutions

Anserteam Workforce Solutions represents North America’s very best staffing agencies aligned together to deliver world-class workforce management solutions. We offer end-to-end talent services that can be customized for any size business, utilizing our Managed Services Provider (MSP) model and Vendor Management Solutions (VMS) technology. Is your organization seeking a WBENC-certified diversity partner to provide measurable results and substantial cost savings?  Contact us today.