A Guide by Martin Gibbons, Author of Retention and CEO of PeopleMaps

How to Improve New Hire Retention

New hire retention is the percentage of new employees who stay long enough to become fully productive and pay back the cost of hiring them. This article shows what poor new hire retention really costs, why so many businesses never fix it, and where to start improving new hire retention, with a particular focus on contact centres and high volume recruitment.

ebook - 3 things you can do today to double your new hire retention

In Short

  • New hire retention measures how many people from a hiring group are still with you at day 30, day 60, day 90, day 180 and 12 months. Martin Gibbons measures it with KeepRate™: the percentage of new hires who pass the New Hire Success Threshold.
  • In Work Institute’s 2020 research, 37.9% of leavers went in their first year, and two in three of those went within six months.
  • 41% of UK HR professionals told the CIPD that new recruits quit within 12 weeks at least sometimes. 27% had new starters fail to turn up on day one.
  • In contact centres, COPC reports that around 70% or more of first year attrition typically happens in the first 90 days.
  • Oxford Economics found it takes an average of 28 weeks for a new employee to reach full productivity, and put the average cost of replacing an employee at £30,614.
  • The REC found a bad hire on £42,000 can cost a business more than £132,000. A third of HR decision makers whose business had made a bad manager hire thought it cost nothing.
  • A contact centre losing 25 new agents a year inside 90 days spends more than £270,000 a year on people who never pay back their cost, before counting lost output.
  • Improving new hire retention starts with three shifts: stop accepting it as a fact of life, stop assuming it’s about money, and study the people who stay.
  • One PeopleMaps contact centre client went from losing half its new hires within 30 days to losing just one new hire in 12 months.

Are You Sick of Hiring People Who Quit?

The scale and cost of early employee turnover, and why so many employers have stopped fighting it.

Let me ask you a question.

How many people did you hire last year?

You probably know that number. Recruitment reports it. It’s on a dashboard somewhere.

Now here’s a harder one. How many of them are still with you?

If you run a contact centre or any high volume operation, I’m guessing you’d rather not answer that one out loud.

Because you know how it goes. The offer gets accepted. The start date gets booked. You set up the laptop, the login and the headset. The trainer spends a week on induction. The team leader spends another three weeks nursing them through nesting.

Then one Friday afternoon, an email lands. “Sorry, this job isn’t for me.”

Or worse. No email at all. They just don’t come back on Monday.

And the seat you filled six weeks ago is empty again.

It doesn’t happen once. It happens every class. Every month. Every year. Until it stops feeling like a problem and starts feeling like “just how it is.”

It isn’t. And it’s costing you far more than you think.

how to improve new hire retention bored bored bored

Let’s put a number on it. Say you hire 100 people a year and a quarter of them leave at around the 90 day mark. That’s 25 people. On a £24,000 salary, each one has cost you £6,000 in wages alone. Add recruitment, training, management time, equipment and employer costs, at least another £4,870, and every one of them costs you £10,870. That’s £271,750 a year spent on people who walked out before they paid you back. Over five years, more than £1.3 million.

Hire 400 people a year with the same loss rate and it’s more than £1 million every year.

And that’s before you count the overtime, the missed calls, the lost sales and the good people who quit because they’re sick of covering for the ones who left.

Here’s the part that really hurts. Oxford Economics found it takes a new employee an average of 28 weeks to become fully productive. In 41% of UK organisations, new recruits are quitting inside 12 weeks. So you’re paying for the whole climb, and most of them are getting off before the top.

As I explain in Retention, recruitment success and retention success are not the same thing. You can be brilliant at hiring and terrible at keeping. And most businesses only measure the first one.

That’s why I measure something different. I call it KeepRate™. It’s the percentage of your new hires who stay long enough to pass the New Hire Success Threshold: the point where they’re fully productive and have paid back what it cost to recruit and train them. One number. It tells you whether your recruitment is actually working.

Most businesses have never calculated their KeepRate. If you did, what do you think it would say?

Recruitment success

What gets counted
Applications, interviews, offers, starts
When it’s judged
The day someone starts
Who usually owns it
Recruitment or talent acquisition
What it tells you
You can fill seats
Commercial result
Cost incurred

Retention success

What gets counted
People still in post at each milestone, from day 30 to 12 months, summed up in your KeepRate
When it’s judged
The day someone becomes productive
Who usually owns it
Often nobody, so operations carries the cost
What it tells you
You can keep the right people in them
Commercial result
Return on the hiring investment

Martin’s view: A hire is not a success. A hire is an investment. It only becomes a success when that person passes the New Hire Success Threshold.

How to improve new hire retention Three Ways to Boost New Hire Retention

Download the free ebook: 3 Things You Can Do Today to Double Your New Hire Retention

Discover where your retention risk begins and what to do before another new starter resigns.

What Is New Hire Retention?

New hire retention is the percentage of people from a specific hiring group who are still employed at set points after their start date.

That’s it. Simple to say. Surprisingly rare to measure properly.

It’s different from general employee retention. Your company wide retention figure blends everyone together. The person who has been with you for twelve years sits in the same number as the person who started on Monday. And because long serving staff are usually stable, they hide the problem. Your overall turnover can look perfectly respectable while your new starters pour out of the back door.

New hire retention isolates the people you’ve just paid to recruit and train. It answers one question: is our hiring investment paying off?

To answer it honestly, you measure by cohort. A cohort is a group who started in the same week, month or training class. Then you track that group at five milestones:

  • Day 30: did they make it through initial onboarding?
  • Day 60: did they make it through basic training?
  • Day 90: are they making some contribution now?
  • Day 180: are they settled in?
  • 12 months: are they a fully productive employee?

When you look at the data this way, something interesting happens. You stop seeing turnover as one big number. You start seeing where people fall out. And that changes everything.

What is new hire retention

How to Measure Your New Hire Retention Rate

MetricHow to calculate itWhat it tells you
Day 90 survivalPeople still employed at day 90 ÷ people who started in the cohort × 100Whether hiring, expectations and early onboarding are working
12 month survivalPeople still employed at month 12 ÷ people who started in the cohort × 100Whether you are producing durable, productive employees
Early attrition concentrationExits by day 90 ÷ all exits in the first 12 months × 100Where your retention problem actually sits

That third metric is the one most employers have never calculated. It’s also the most revealing.

If most of your first year leavers go before day 90, your problem almost certainly starts in recruitment, selection and the first few weeks. If people survive day 90 and then drift away before month 12, look harder at management, workload and progression.

Same headline turnover. Completely different causes. Completely different fixes.

And here’s the thing. Once you see these numbers by recruitment source, site, shift, campaign and manager, the averages stop hiding anything. One team will look fine. Another will be quietly losing half its new starters. You can’t fix what you can’t see.

KeepRate™: One Number for New Hire Retention

Those three metrics tell you where the problem is. KeepRate tells you how big it is.

KeepRate is the percentage of new hires who stay long enough to pass the New Hire Success Threshold. Before that point, a new hire is still a recruitment cost. After it, they’re a productive, retained employee. If they leave later, that’s normal attrition, not a failed hire.

I built KeepRate because boards don’t want five metrics. They want one number they can track, compare and improve. And when your KeepRate goes up, your recruitment bill comes down.

Employees Leaving Within 6 Months

If you’re losing new starters faster than you’d like, you’re not imagining it. And you’re not alone.

Here’s what the research says.

37.9%

37.9% of people who leave an employer do so within their first year

Work Institute, 2020 Retention Report

Two out of three

Two out of three first year leavers go within six months

Work Institute, 2020 Retention Report

40%

Roughly 40% of first year leavers go within 90 days, and nearly one in five within 30 days

Work Institute, 2020 Retention Report

41%

41% of UK HR professionals say new recruits quit within the first 12 weeks at least sometimes

CIPD and Omni RMS, 2024

27%

27% of UK employers have had new starters fail to turn up on day one

CIPD and Omni RMS, 2024

56%

56% of UK employers say retaining talent has become harder

CIPD and Omni RMS, 2024

70%

Call centres typically see around 70% or more of first year attrition in the first 90 days

COPC Inc.

31.2%

Average annual agent turnover in UK contact centres is 31.2%

MaxContact UK benchmark, 2025/6

Read that table again, slowly.

Of all the people who walk out in their first year, most are gone before they’ve finished their first six months. In contact centres, most are gone before they’ve finished their first three. And in more than a quarter of UK organisations, some don’t even make it to the first shift.

Work Institute’s own verdict is blunt. People who leave in the first ninety days deliver little or no return on the investment made to hire them.

Think about what that means in your business. Every one of those people was advertised for, screened, interviewed, offered, inducted, trained and paid. Then they left. And the vacancy you filled is open again.

If that’s happening once a year, it’s an annoyance. If it’s happening every month, it’s a business model. Just not one you chose.

How long before a new hire pays back

How Long Before a New Hire Pays Back?

Oxford Economics puts the average time to full productivity at 28 weeks. For people joining from another sector, it’s 32 weeks. For people coming back from unemployment, it’s a full year. In high volume recruitment, that describes a lot of your new starters.

This is why I talk about the New Hire Success Threshold. It’s the point at which a new hire has stayed long enough to become fully productive and pay back what it cost to recruit, onboard and train them. Before that line, every new starter is a cost. After it, they’re an asset.

Every person who leaves before the line takes your investment out of the door with them. Every single time.

Martin’s view: Recruitment isn’t successful when someone starts. It’s successful when they stay long enough to succeed.

The Real Cost of Losing a New Employee

In Retention, I argue that the most expensive employee is not necessarily the highest paid. It’s the new hire who leaves before becoming productive.

The research backs that up.

Oxford Economics put the average cost of replacing an employee in the UK at £30,614. Only around £5,400 of that is the visible stuff: advertising, agency fees, interviewing and admin. The other £25,181 is lost output while the replacement gets up to speed. That study was published in 2014. Wages have risen a long way since.

The REC worked through a real example in its 2017 Perfect Match report. A poor hire at middle manager level on £42,000 can cost a business more than £132,000 once wasted salary, wasted training, lost team productivity and the cost of replacing them are added up. That’s more than three times the salary.

And here’s the part that should worry you most. In the same REC research, 85% of HR decision makers admitted their organisation had made a bad hire. A third of those whose business had hired the wrong person into a manager or director role believed it had cost them nothing. One in five didn’t know.

That’s the real problem. Not that the cost is high. That almost nobody is counting it.

The real cost of losing a new employee

Here’s what really leaves with every early leaver:

CostWhat you actually lose
RecruitmentAdvertising, job boards, agency fees, screening and assessment
SelectionHours of interview time from recruiters and managers
OnboardingInduction, IT setup, system licences, compliance checks
TrainingTrainer time and weeks of full salary paid while someone learns
Management timeTeam leaders coaching people who then leave
Lost outputPaying full wages for partial output during ramp up
ReplacementThe whole cycle again, for the same seat
Overtime and coverExisting staff working extra to fill the gap
CustomersLonger queues, missed service levels, lost sales
MoraleGood people tired of training people who walk out

Most finance teams only ever see the first line. The rest is hidden in other budgets, other people’s evenings and other people’s patience.

What Early Attrition Costs a Contact Centre

Let’s put some real numbers on it.

Imagine a contact centre that hires 100 agents a year on a salary of £24,000. And 25 of those 100 agents leave at around the 90 day mark. Given that COPC typically sees most first year attrition land in the first 90 days, many operations would call that a good year.

Here’s what each early leaver costs, using the PeopleMaps cost model:

Cost per agent who leaves at 90 daysAmount
90 days’ salary (13 weeks at £24,000 a year)£6,000
Recruitment, training, management time, equipment and employer costs£4,870
Total, before any lost output£10,870

Now multiply it.

Annual hiresEarly leavers (25%)Cost to the business each year
10025£271,750
25063£684,810
400100£1,087,000
1,000250£2,717,500

That’s money spent on people who left before they ever paid you back.

And it’s the cheap version. It leaves out the overtime paid to cover the empty seats. The calls that went unanswered. The sales that weren’t made. The customers who got a nervous new starter instead of an experienced agent. And the fact that every replacement starts the clock again, with weeks or months to go before they’re productive.

Check this against your own numbers. Take your annual hires. Multiply by the share who leave inside 90 days. Multiply that by what one agent costs you up to the day they leave. Most operations directors who do this properly go quiet for a moment.

Not because any single loss is huge. Because nobody had ever added them up.

The first 90 day cliff

The First 90 Day Cliff

You know this pattern. You’ve lived it.

The class starts on a Monday. Twenty new faces. Bright, keen, saying all the right things. By Friday of week one, someone hasn’t come back from lunch. By week three, two more have rung in sick and never returned. By the time the class goes live on the phones, you’re down to fourteen. By day 90, eleven.

I call this The First 90 Day Cliff. It’s the period where a large share of new hires simply fall away, before they’ve delivered anything back.

Nowhere is it steeper than in contact centres. COPC, which sets performance standards for customer experience operations, reports that call centres typically see around 70% or more of their first year attrition inside the first 90 days. In one COPC case study, an operation was keeping fewer than half of its new staff to the 90 day mark.

Fewer than half.

And the cliff doesn’t just take the leavers. It takes your trainers’ time. Your team leaders’ patience. Your planning, because you can’t forecast headcount when you don’t know who’ll still be there next month. It takes your service levels, because you’re always running short. And it takes the energy of the good people who stay, who are sick of carrying the load every time a new class falls apart.

The worst part? It’s become normal. Most operations have stopped asking why it happens. They just plan for it, overhire for it, and budget for it.

Martin’s view: A new hire’s first 90 days are not simply an onboarding period. They are a retention risk period, and most employers aren’t managing them like one.

The Recruitment Treadmill

Here’s the question I ask every operations director I meet.

If you stopped recruiting today, how long would it take for your headcount to fall?

For most high volume employers, the honest answer is days. Not because the business is shrinking. Because it’s losing new starters almost as fast as it hires them.

That’s the recruitment treadmill. You’re not recruiting to grow. You’re recruiting to stand still. Every month the job ads go out, the interviews get booked, the training room fills up, and at the end of the year your headcount is roughly where it started. Your recruitment bill isn’t.

And look at who pays for it.

The recruitment treadmill

Your recruitment team

hits its targets and still gets blamed, because the people they hired didn’t stay.

Your trainers

deliver the same induction to class after class, knowing a chunk of the room won’t be there in a month.

Your team leaders

spend their days coaching people who leave, instead of developing the people who stay.

Your experienced staff

pick up the overtime, cover the gaps and answer the questions. Some of them eventually decide they’ve had enough too.

Your customers

wait longer, repeat themselves more and get passed to someone who’s still learning.

And you

go into another budget meeting asking for more recruitment money, to fix a problem that more recruitment has never fixed.

Be honest. How long have you been on this treadmill? A year? Three? Longer?

How many times have you told yourself the next class will be different?

The research says you’re not alone. But it also says something uncomfortable. This isn’t bad luck, and it isn’t the labour market. Early attrition follows patterns. And patterns can be changed.

The only real question is how much more you’re prepared to spend before you change them.

How to Improve New Hire Retention

So how do you actually improve new hire retention?

Here’s where I’d start.

1. Stop Accepting It as a Fact of Life

The biggest reason businesses never fix poor new hire retention isn’t budget. It isn’t time. It’s belief.

Most don’t believe there is a solution. So they never really look for one.

“Our industry is just like that.” “Contact centres always lose people.” “It’s the labour market.” I hear it all the time.

If you’re reading an article called How to Improve New Hire Retention, you’ve probably already cleared this first hurdle. You suspect there’s a better way.

You’re right.

2. Understand That It’s Not About the Money

Everyone will tell you it’s the money. It isn’t.

Work Institute has interviewed hundreds of thousands of people who left their jobs. In its 2020 report, pay and benefits accounted for only about 9% of the reasons they gave.

This is the second big stumbling block. If you believe pay is the answer, and you can’t increase pay or don’t control the budget, that’s the point where you give up. You never ask the real question.

In Retention, I cover this in detail and explain the psychology behind it. For this article, I’ll simply ask you to believe me. You will not solve this problem by paying people more.

3. Look at the People Who Stay

Unless everyone quits within a few weeks of starting, some of your new hires stay. In most businesses, the majority stay.

So what does that tell you?

Mostly, it tells you that sometimes you get lucky.

But luck can be systemised. You can break it down into its parts, find the real pattern behind why people stay, and once you know what’s working, you can reproduce it.

4. Find the Pattern Nobody Else Can See

Every one of my clients had already spent a lot of time looking for patterns. Why do new hires quit? Why do others stay?

They ran exit interviews. They went back through all the data. They looked at education, qualifications, age, experience and background.

None of it revealed a pattern. It all looked completely random.

It isn’t random. My job, and my skill, is seeing the patterns others can’t. Showing you why your new hires quit, and why so many of your people stay.

How to improve new hire retention

What Happens When You Find the Pattern

Let me give you a real example.

One of my contact centre clients was losing 50% of their new hires within a month of starting.

This was a good company. They paid above average. They used a good agency that only put forward top quality candidates. They had tried everything.

None of it worked. If they started six people, three were gone within 30 days. Often four were gone within 60.

Then we implemented RetentionMaps.

In the first 30 days, they lost nobody. Across the next 12 months, they lost just one new hire in total.

Same company. Same pay. Same jobs. What changed was that they could finally see the pattern.

Where You Stand Right Now

Before you do anything else, be clear about what this is costing you.

  • More than a third of people who leave an employer do so in their first year, and most of those go within six months.
  • 41% of UK employers see new recruits quit within 12 weeks. It takes an average of 28 weeks to become fully productive.
  • In contact centres, around 70% or more of first year attrition typically happens in the first 90 days.
  • Replacing one employee costs an average of £30,614. A single bad hire on £42,000 can cost more than £132,000.
  • A contact centre losing 25 new agents a year inside 90 days can spend more than £270,000 a year on people who never pay back their cost. At 100 early leavers, it’s over £1 million.

You can keep absorbing that. Plenty of businesses do, year after year. They call it the cost of doing business, overhire to cover the gaps, and hope the next class is better.

Or you can decide you’ve put up with it for long enough.

If you’ve read this far, I suspect you already have.

The good news is that you don’t need a bigger budget, a new HR system or a pay rise for everyone. You need to understand why your new hires are really leaving, where your retention risk actually begins, and what to do about it before the next class walks through the door.

That’s exactly what my free ebook, 3 Things You Can Do Today to Double Your New Hire Retention, shows you. It brings together more than 25 years of work with PeopleMaps and everything I’ve learned writing Retention, so you can start reducing new hire turnover with the very next people you hire.

It’s free. It won’t take long to read. And it could be the last time you have to accept losing a quarter of every class.

Download the free ebook now and learn how to reduce new hire turnover before another new starter resigns.

Frequently Asked Questions About New Hire Retention

What is new hire retention?

New hire retention is the percentage of employees from a specific hiring group who are still employed at set milestones after their start date, usually day 30, day 60, day 90, day 180 and 12 months. Unlike overall employee retention, it isolates recent starters, so long serving staff don’t mask early losses. Martin Gibbons, author of Retention, describes it as the real test of whether recruitment has worked.

What is KeepRate™?

KeepRate™ is a new hire retention measure developed by Martin Gibbons, CEO of PeopleMaps. It is the percentage of new hires who stay long enough to pass the New Hire Success Threshold, the point at which they are fully productive and have covered the cost of recruiting and training them. People who leave after that point count as normal attrition. People who leave before it are failed hires.

How do you calculate new hire retention?

Divide the number of employees still employed at a chosen milestone by the number who started in that cohort, then multiply by 100. For example, if 40 people started in March and 26 remain at day 90, day 90 retention is 65%. Use start dates rather than offer dates, and report voluntary and involuntary leavers separately.

How many new hires leave in their first year?

Work Institute’s 2020 Retention Report found that 37.9% of employees who left their employer did so within their first year. Two out of three of those first year leavers went within six months, and roughly 40% went within 90 days. In the UK, 41% of HR professionals told the CIPD in 2024 that new recruits quit within the first 12 weeks at least sometimes.

When are new employees most likely to leave?

New employees are most likely to leave in their first few months. Work Institute found two out of three first year leavers go within six months, and nearly one in five within 30 days. In contact centres, COPC reports that around 70% or more of first year attrition typically happens in the first 90 days, making this the highest risk period.

What is the staff turnover rate in UK contact centres?

MaxContact’s 2025/6 UK benchmark put average annual agent turnover in UK contact centres at 31.2%, up from 30.2% the year before. US surveys often report higher figures. Crucially, much of that turnover is concentrated among new starters: COPC reports that call centres typically see around 70% or more of their first year attrition within the first 90 days.

How long does it take a new employee to become productive?

Oxford Economics found that new employees take an average of 28 weeks to reach full productivity. People joining from another sector take around 32 weeks, and those returning from unemployment take a full year. Because many new hires leave within 12 weeks, employers often pay for the learning curve without ever receiving a productive employee.

How much does it cost when a new employee leaves?

Oxford Economics put the average cost of replacing a UK employee at £30,614, of which £25,181 was lost output while the replacement got up to speed. The REC found a poor hire on £42,000 can cost more than £132,000. Early leavers are especially expensive because the employer pays the full hiring and training investment and receives almost no return.

How much does it cost to lose a new contact centre agent?

The cost depends on salary and how long the agent stays. Using the PeopleMaps cost model, a UK agent on £24,000 who leaves at the 90 day mark has cost around £6,000 in salary, plus at least £4,870 in recruitment, training, management time, equipment and employer costs. That is around £10,870 per early leaver, before lost output. A centre losing 100 new agents a year at that point would spend more than £1 million.

What is the New Hire Success Threshold?

The New Hire Success Threshold is the point at which a new hire has stayed long enough to become fully productive and pay back the cost of recruiting, onboarding and training them. The term was defined by Martin Gibbons, author of Retention. Before the threshold, a new hire is a cost. After it, they are a productive, retained asset.

What is early employee turnover?

Early employee turnover is the loss of new starters within their first months, usually before they reach full productivity. It includes people who resign, are dismissed or never turn up. It matters because employers carry the full cost of recruiting and training these people but get little return. Martin Gibbons measures its impact with KeepRate™.

How can employers improve new hire retention?

Start by refusing to accept early attrition as a fact of life, and stop assuming pay is the answer. Then study the people who stay, not just the ones who leave. Most employers already keep the majority of their new hires, so a pattern behind successful hires exists. Martin Gibbons, author of Retention, shows how to find it in his free ebook, 3 Things You Can Do Today to Double Your New Hire Retention.

How to improve new hire retention Three Ways to Boost New Hire Retention

3 Things You Can Do Today to Double Your New Hire Retention

Download the free ebook and get the full approach to improving new hire retention.

martin with retention book 001

About the Author

Martin Gibbons is a specialist in new hire retention and the Co-founder and CEO of PeopleMaps. For more than 25 years he has helped organisations improve recruitment, management and staff retention through a better understanding of personality. More than 1.5 million PeopleMaps profiles have now been completed.

He is the author of Retention and Fit First, the creator of KeepRate™ and the originator of Occupational Friction™. His central argument is simple: poor new hire retention is harming your business and costing you money. Improve your new hire retention and you give yourself a competitive advantage. In 2022 he was named CEO of the Year by CEO Monthly. Read more about Martin and PeopleMaps.

Sources

  • Work Institute, 2020 Retention Report: 37.9% of leavers exited in their first year; two in three first year leavers left within six months; first year turnover by tenure band; compensation and benefits cited in about 9% of exits.
  • CIPD and Omni RMS, Resourcing and talent planning report 2024: survey of over 1,000 UK HR professionals; 41% report new recruits quitting within 12 weeks; 27% report day one no shows. See also the CIPD press release.
  • COPC Inc., Onboarding Best Practices: Reducing Attrition in the First 90 Days: call centres typically see around 70% or more of first year attrition in the first 90 days.
  • COPC Inc., case study: Strategic Response to Managing Attrition in Remote Work: operation retaining fewer than half of staff to 90 days.
  • MaxContact, 2025/6 UK Contact Centre KPI Benchmarking Report, as reported by Voxbooster: 31.2% average annual UK agent turnover. Secondary source; link to MaxContact’s own report before publishing.
  • Oxford Economics and Unum, The Cost of Brain Drain (2014), as reported by HR Review: £30,614 average replacement cost; £25,181 lost output; 28 weeks to optimum productivity; 32 weeks from another sector; 52 weeks from unemployment.
  • REC and Indeed, Perfect Match: Making the right hire and the cost of getting it wrong (2017): a poor hire on £42,000 can cost more than £132,000; 85% admit a bad hire; a third think it cost nothing.
  • CIPD survey as reported by HR Magazine: 56% say retaining talent has become harder; survey of 1,016 UK people professionals, April 2024.
  • Contact centre cost example: the PeopleMaps cost model using the stated assumptions (salary £24,000, leaver at 90 days: £6,000 salary plus at least £4,870 other costs). Not a published benchmark.
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