Recruiting, interviewing, and training a new employee who replaces a worker who has just resigned are examples of which one of the following types of financial consequences flowing from personnel losses?

Recruiting, interviewing, and training a new employee who replaces a worker who has just resigned are examples of which one of the following types of financial consequences flowing from personnel losses?

• A. Replacement costs
• B. Depreciation costs
• C. Loss of value
• D. Compensation costs

Answer: (A)

When a worker resigns, the organization faces replacement costs—the expenses to recruit, interview, select, and train a new employee. These are the direct, one-time or short-term costs tied to bringing someone new into the role and getting them productive. Depreciation costs relate to physical assets wearing out or losing value, not people. Loss of value is a broader idea about overall asset or business value, not the specific hiring process. Compensation costs are ongoing wages and benefits for employees, which occur after the replacement is brought on, not the initial replacement activities.

When a worker resigns, the organization faces replacement costs—the expenses to recruit, interview, select, and train a new employee. These are the direct, one-time or short-term costs tied to bringing someone new into the role and getting them productive. Depreciation costs relate to physical assets wearing out or losing value, not people. Loss of value is a broader idea about overall asset or business value, not the specific hiring process. Compensation costs are ongoing wages and benefits for employees, which occur after the replacement is brought on, not the initial replacement activities.