The New Dictionary of Hiring

Indifference Tax

/IN-DIF-RUHNS TAKS/

NOUN

The Indifference Tax is the extra time, money and effort required to hire people who have little reason to prefer your company.

MEANING

Indifference isn't free. You pay for it with more sourcing, more ads, more agencies, more recruiter time, longer searches and, eventually, bigger offers.

‍

When the people you want don't have a reason to prefer you, the cost doesn't disappear. It lands somewhere else in the hiring budget. Employer brand looks expensive when nobody remembers to count what it costs to be ignored.

Defined by:
James Ellis,
Employer Brand Labs

Category:

Essentials

Related Terms:

Compensation Substitution

The New Dictionary of Hiring card: Indifference Tax, noun. The extra time, money and effort required to hire people who have little reason to prefer your company. Abstract iridescent glass shape on a white background.

MAKE THE CHANGE

Instead of:

Assuming weak employer preference has no financial consequence.

Ask:

How much recruiting spend exists because we haven't created preference in advance?

EXAMPLE

A team spends heavily on ads, agencies and repeated outreach just to get qualified people to take a first conversation. Candidates who already know and prefer another employer answer them immediately.

HOW TO USE IT

Track the extra sourcing effort, advertising and agency dependence required in markets where people have no reason to choose you. Use those costs to make the case for building preference before the search.

SAY IT TO LEADERSHIP

We're paying more every time we hire because too many of the people we need are indifferent to us. That's a cost we can reduce, but it won't be fixed with another job ad.

NOT TO BE CONFUSED WITH

Sameness Tax: the Sameness Tax is one cause of the Indifference Tax. When candidates can't tell employers apart, they decide on pay and convenience. The Indifference Tax is the total extra cost of not being preferred.