Every business has an empty chair somewhere. A desk gone quiet since someone left. A shift nobody’s covering. A role that’s sat “in progress” on the org chart longer than anyone wants to admit.
Some people see that chair as a saving. No wages going out, no harm done. I disagree. Talk to a sales team missing its closer, or a finance function running one person short, and you’ll hear a different story. Missed targets. Team members picking up work that isn’t theirs. Decisions stuck because the person who should be making them hasn’t been hired yet.
Sacha and I have both seen what that empty chair actually costs, why some vacancies cost far more than others, and why many organisations only notice the damage once it hits a board meeting.
How Is That Empty Chair Affecting Your Business?
There’s no single answer to this, but I could look at a P&L compared to a business’s budget or forecast and see it quite clearly. If they’re down on sales headcount, revenue is likely to be down too. From there you start to see the flow-on effects: profitability, growth plans, everything.
If they’re missing someone in the support team, you’ll start to see delays or lags in service delivery, and in business processes as well. An empty chair in the finance team means monthly results aren’t being reported as efficiently, and important things get missed. Altogether, it slows down the momentum of the business.
So what you’d start to see is declining results or missed targets, and challenges with team morale. Team members feeling overworked, maybe starting to feel a little resentful. That can impact your culture.
We recently recruited for an Indigenous health organisation where the cost of a vacancy lands well outside the org chart. They need nurses available to fill shifts, and if they don’t have those nurses, they can’t open the medical facilities the community relies on. This isn’t corporate life, salespeople selling products. It’s nurses helping administer medicine and care to the elderly, to children, to pregnant women, to people in need. The cost of an empty chair can reach a long way past the business it sits in.
Why Do Vacant Roles Cost More in Remote and Regional Communities?
A vacancy reads as a saving because the salary line is the only part of it that’s easy to see. In a metro business you can hold that assumption for a while. In regional and remote health, it collapses almost immediately, and that’s what makes these roles worth looking at closely. They strip out every option a city business quietly relies on.
In a city, if a role goes unfilled, you find a way to cope, spread the work around, get someone in temporarily. Out in a very remote community, that option doesn’t exist. There’s no GP down the road. No clinic to send people to instead. Some of these places you can only get to by four-wheel drive, or by plane, and plenty of the time the phone and internet aren’t reliable either. So if a nurse role sits empty, that’s not a gap that gets absorbed somewhere else. It can mean nobody’s providing services there, full stop. One person is the difference between a community having support or not having it.
Why are these roles so hard to fill? Housing’s the big one. Some organisations can offer it, but it might be shared accommodation. There’s not always space for family members, and pets are often not allowed- things that rule people out before they’ve even considered the job itself. Beyond housing, you need someone with the right skills and the resilience for that kind of environment. It requires a certain kind of person, and that’s where behavioural testing earns its place. It tells you about someone’s working style, whether they’re suited to the remote environment and the complexities of the role, rather than just whether they’ve got the right experience.
When we take these roles to market, we talk about the challenges as openly as we talk about the rewards, the connection to community, the sense of purpose, all of it. Because if someone takes the job with an unrealistic picture of what it involves, they’re not going to last. Transparency plus the right assessment is what makes these roles stick. Finding someone who fits the environment, not just someone who fits the job description.
What Does an Unfilled Position Really Cost Beyond the Salary?
When you don’t have the person in the seat, you’re benefiting in that you’re not paying the salary, but the cost is so much greater than that benefit. It depends on the role, but generally, even for a not-for-profit or a healthcare organisation, it comes back to lost revenue, or lost opportunity to deliver services that contribute to revenue. That’s one of the highest costs. Then you start to think about the cost of burnout in the team covering the gap, and the cost of turnover if those people move on.
It’s also worth saying that if a role gets filled by the wrong person, you’re often looking at nearly the same flow-on effects as leaving it empty. The cost of a bad hire is widely publicised, two to four times that person’s annual salary, and that holds up. Sometimes we take that too far and get nervous about hiring at all, so we slow right down. I’m a proponent of hire slow, fire fast. Be intentional with your hiring decisions; don’t bring anyone into the business who isn’t aligned with your cultural values, because that creates a big headache of its own. There’s a limit to it though. You can overthink a hiring decision to the detriment of your organisation, and that’s exactly where the cost of the empty seat compounds.
This is where quality of hire matters as much as speed. The sweet spot is leveraging tools and methodologies that help you attract and appoint the right person in a time-efficient way, backed by something that tells you this is likely the right person for the role.
How Do You Calculate the Cost of a Vacancy?
There’s no single formula that applies to every business, but a simple version most organisations can use looks like this:
Cost of Vacancy = (Lost Revenue or Output) + (Overtime and Coverage Costs) + (Recruitment Costs) + (Productivity Loss) minus (Salary Saved)
Broken down:
- Lost revenue or output: what the role would have generated or delivered if filled. For a salesperson, this might be forecast revenue per month. For a nurse, it might be the value or volume of care that couldn’t be delivered.
- Overtime and coverage costs: what you’re paying existing staff to cover the gap, plus any agency or temp costs.
- Recruitment costs: advertising, agency fees, internal recruiter time.
- Productivity loss: the flow-on drag on other teams or processes, harder to quantify but real, as reflected in the ripple effects described throughout this article.
- Salary saved: the unpaid salary for the vacant role, which offsets the total cost.
A rough monthly figure is usually enough to make the cost visible and prompt action. It won’t be precise, and precision isn’t the point. The exercise is designed to shift the conversation from “we’re saving money by not filling this role” to “here’s what leaving it empty is actually costing us.”
What’s the Most Common Mistake When Calculating Vacancy Cost?
The most common mistake is only counting the obvious cost, the unpaid salary, and stopping there. People forget to factor in the cost of covering the gap, the lost revenue or output, and the flow-on effects on other teams. The other mistake is trying to build one formula that applies to every role in the business, when it needs to flex depending on whether you’re talking about a revenue-generating role, a support role, or something in delivery.
Where Does the Cost of a Vacant Role Show Up Unexpectedly?
For our business, the team that feels a sales vacancy first is software engineering. We budget developer headcount against the revenue targets sales is responsible for winning and retaining. Miss those targets and the correction doesn’t stay inside the sales team, it lands on the product roadmap. That’s not a connection you’d draw from an org chart, and it’s the one I watch most closely.
Finance is the other one. We run lean there, so a single vacancy shows up as invoices going out late, bad debt not chased as tightly, and monthly accounting landing later than the executive team needs it. We end up making decisions on an older picture of the business than we should be. None of that gets reported as cost of vacancy. It gets reported as slower decisions and softer cash flow.
The other factor is that every coverage arrangement assumes the people doing the covering stay well and stay present. A business can absorb an unfilled position for a while, and that absorption holds until someone gets sick, someone goes on parental leave, or a family emergency lands in the same fortnight. At that point you’re carrying two gaps, and you only planned for one.
How Does One Empty Chair Cost You a Second Person?
I’ve heard stories from our regional health clients where, with fewer nurses than needed, the remaining nurses end up doing overtime to cover shifts. That’s a stressful job, physically and emotionally demanding, and doing overtime or extra shifts long-term under those circumstances can completely burn someone out. Then you’ve lost that nurse too, on top of the original empty seat.
There are lead indicators and lag indicators for this. A lag indicator might be low morale, negative feedback in pulse surveys or engagement surveys, or just a general cultural vibe that this isn’t a place people are bouncing out of bed to come to. Lead indicators are what happen before you get to that point. If you’re starting to ask your team, “Can you cover this,” or “I know this isn’t usually part of your role, but can you absorb this,” that’s fine for a short amount of time, but it’s not sustainable long term.
I think it’s easy, when you’re running a business with a lot of pressure and a lot on your plate, to take for granted the great people on your team who are so willing to help. They’ll say yes, they’ll put their hand up, because they want to help. You have to protect them too. Some of that stretch is good for them; it creates learning and career development opportunities. But you need the right agreement in place with that person, and it needs to be sustainable, or you risk losing them as well.
How Do You Balance Speed and Quality in Time to Hire?
You can go too fast or too slow. Go too fast, and you hire the wrong person, and you’re back with the empty seat before you know it, which becomes a vicious cycle. You have to find that balance, and that’s where recruitment tools come in.
A broad, wide-reaching attraction strategy that touches both passive and active candidates is the start. Then, first-round structured screening questions on the talent landing page- don’t just rely on a resume or cover letter; ask the questions you actually want answered from the start. There’s a plethora of interviewing tools available too, depending on the role:
- One-way video interviews
- Two-way video interviews
- Face-to-face interviews
- Group interviews
Which one you use depends on the role, but the goal is always to understand the person. I’m particularly excited about behavioural testing at the moment, using something like McQuaig alongside a job definition survey. Defining what sort of person you’re looking for, then testing whether they’re a match, sets the role up for much better success. For roles where AI fluency itself is part of the profile, our AI-native hiring guide breaks down how to screen for that mindset rather than just the skillset on paper.
What Does It Mean When Time to Hire Runs Well Above Average?
Usually it’s a symptom of something further upstream rather than a hiring process problem on its own. If a business is well above the industry average, I’d be looking at whether they’ve actually defined who they’re looking for before they started the search. A lot of the time the process itself is fine, but there’s no clear agreement internally on the profile, so candidates get pushed backwards and forwards between decision makers and nothing moves. It can also point to a weak attraction strategy. If you’re not reaching the right pool of candidates in the first place, no amount of process improvement downstream is going to fix that.
Can One Empty Chair Stall Something Bigger Than the Role Itself?
A single empty chair can delay outcomes far bigger than the role itself, including IPOs, capital raises, and major projects.
I’ve seen companies with plans to IPO, or companies trying to raise capital against a three-year plan, where empty seats now meant that plan was greatly impacted, because you need to be able to demonstrate growth to achieve those big events. That’s often where executive search earns its keep, since the roles that stall an IPO or a raise are rarely the ones you can afford to leave to chance.
Every team needs a leader, and on any project where a lot of people are involved, you need someone to step in and drive focus. Without a clear leader guiding things to the finish line, it starts to feel like too many hands and too many moving parts. Many hands make light work, as the saying goes, but without direction it can just as easily turn into chaos.
When Does Leadership Actually Notice a Vacancy Problem?
Leadership tends to notice at the big moments. A board meeting, a capital raise, a quarterly result that’s come in short. By then the cost has been compounding for months, and reacting is the only option left. The businesses that manage this well have someone below leadership level tracking vacancies and their impact as a standing number, so it reaches the executive team as a trend they can act on rather than a figure that lands in a board pack.
How Do You Fix the Process, Not Just the Seat?
Get clear on the type of person you’re looking for. Use a tool like a job definition survey or similar. Where recruitment stalls, where you end up with that empty seat, it’s often because there’s more than one hiring manager or decision maker weighing in, and without even realising it, they’re looking for different people. Say it’s two of us recruiting salespeople. If one of us has one type of person in mind and the other has a different one, we interview someone, one says yes, one says no, and we don’t hire them. Or we hire someone who isn’t the right fit, and they don’t work out.
From there, it comes down to adopting a more structured recruitment process, not a feelings-based one. A real assessment, a rating and ranking system. A stronger talent acquisition strategy, and tools like a candidate scorecard, make that consistent rather than reliant on gut feel.
What Should You Do This Week to Fill a Vacant Role Faster?
If I could get one thing across to a business staring at an empty chair right now, it’s this: write down the profile of who you’re looking for, and socialise it across your organisation. Everyone involved in that recruitment decision has to agree on that profile before anyone gets interviewed.
Then look at why the role was empty in the first place. Do a self-assessment. Was it cultural? Was it the role itself? Was the business expanding too quickly? Were they too junior or too senior for what was needed? It’s about reflection as much as it’s about action.
If your hiring process is still relying on gut feel to fill roles like these, we can help you build one that doesn’t. Book a call with Scout Talent to see how a structured, on-demand approach to recruitment closes the gap faster and keeps it closed.
