Stop Saying 'Human Resource Costs'! Here's What the Experts Say

Have you ever found yourself in a meeting, wanting to discuss 'human resource costs' with your foreign colleagues or boss, but suddenly felt tongue-tied?

Several terms crossed your mind: labor costs, personnel costs, hiring costs... Which one was correct? All seemed plausible, yet none felt quite right. Ultimately, you might have vaguely muttered, "our people cost is too high," which sounded unprofessional and failed to articulate the core problem.

It's akin to visiting a doctor and merely stating 'I'm unwell,' without specifying if it's a headache, fever, or stomach ache. The doctor cannot provide a precise diagnosis, and you won't be able to resolve the actual issue.

Today, let's approach this differently. Instead of memorising 'human resource costs' as a singular term, let's view it as a 'corporate health check-up'.

Be Your Own 'Business Doctor' to Precisely Diagnose Cost Issues

An effective business communicator is much like an experienced doctor. They don't use vague terms such as 'sick'; instead, they offer precise diagnoses: Is it a viral flu or a bacterial infection?

Similarly, when discussing costs, adept professionals won't merely state 'human resource costs are too high'; they will precisely pinpoint the root cause of the issue.

Before you speak next time, ask yourself these three questions:

Are we discussing the cost of 'getting work done'? (Salaries and bonuses paid to employees)
Are we discussing the cost of 'maintaining talent'? (Beyond salaries, this includes all expenses like benefits, insurance, training, etc.)
Are we discussing the cost of 'acquiring talent'? (Expenses incurred when recruiting new employees)

Once you have clarity on these questions, the accurate English terminology will naturally come to mind.

Your 'Diagnostic Toolkit': Three Core Terms

Let's explore the most crucial diagnostic tools in your 'medical toolkit'.

1. Labour Costs: Diagnosing 'Labour' Itself

This is akin to measuring a patient's 'body temperature.' Labour Costs primarily refer to expenses directly paid for employees' 'labour,' such as what we commonly call wages, salaries, and bonuses. It's directly linked to production and workload.

Usage Scenario: When discussing production line man-hours or project personnel input-output ratios, this term is most accurate.
Example: “By optimising the assembly line, we successfully reduced our labour costs by 15%.” (Through optimising the production line, we successfully reduced labour costs by 15%.)

2. Personnel Costs: Diagnosing 'Total Employee Costs'

This is equivalent to conducting a 'full-body scan' for the organisation. Personnel Costs is a more comprehensive concept, encompassing not only labour costs but also all indirect expenses related to 'people,' such as employee benefits, social security contributions, pensions, training fees, and so on.

Usage Scenario: When you are preparing annual budgets, analysing overall operating expenses, or reporting to management, using this term demonstrates your macro perspective.
Example: “Our personnel costs have increased this year due to the new healthcare plan.” (Due to the new health insurance plan, our total personnel costs have risen this year.)

3. Hiring Costs vs. Recruitment Costs: Diagnosing the 'Talent Acquisition' Phase

This is where confusion often arises, and also where you can best demonstrate your expertise. Both relate to 'finding people,' but their emphasis differs.

Recruitment Costs (Cost of Recruitment Activities): This is akin to the expenses of the 'diagnostic process.' It refers to all costs incurred to identify suitable candidates, such as publishing job advertisements, participating in job fairs, or paying headhunters.
Hiring Costs (Cost of Onboarding): This is more like the expenses of the 'treatment plan.' It refers to direct costs incurred after deciding to hire someone, up until their official joining date, such as background verification fees, signing bonuses, or new employee induction preparation.

Simply put, Recruitment is the process of 'seeking,' while Hiring is the act of 'onboarding.'

Example: “We need to control our recruitment costs by using more online channels instead of expensive headhunters.” (We need to control recruitment activity costs by using more online channels instead of expensive headhunters.)

From 'Memorising Words' to 'Problem-Solving'

You see, the crux of the matter has never been about memorising a string of isolated words, but understanding the underlying business logic each term represents.

When you can, much like a doctor, clearly diagnose that 'our company's problem isn't excessive salaries (labour costs), but rather inefficient new talent acquisition, leading to soaring recruitment costs,' your contribution immediately gains gravitas and insight.

Of course, even the most adept 'doctors,' when engaging with 'patients' (partners) from across the globe, might encounter language barriers. When you need to communicate these precise business diagnoses in real-time and with clarity to global teams, an effective communication tool becomes your 'personal translator'.

The Intent chat app, with its integrated top-tier AI translation features, empowers you to ensure every precise term is perfectly understood by the other party in cross-border communication. Whether discussing personnel costs or recruitment costs, it helps you overcome language barriers, allowing your professional insights to truly resonate.

Next time, don't just fret about 'how to say this word in English'.

First diagnose the problem, then speak. This is the paradigm shift from an ordinary employee to a business elite.