Cost of a Bad Hire – And How to Prevent Them
On average, a single bad hire costs a company about $15,000. Often, larger businesses bear a bigger financial burden when a new employee doesn’t work out. For those with 500 to 999 workers, the average is a startling $22,000. If a company has more than 1,000 employees, the average is a cumbersome $24,000.
Even knowing the cost, 74 percent of hiring managers admit that they’ve made a bad hire. Luckily, they are avoidable, as long as you take the right steps. If you want to learn more about what a bad hire is and how you can prevent them, here’s what you need to know.
What Makes a Bad Hire?
A bad hire can involve a variety of scenarios. The most common outcome is that the employee’s deliverables were subpar. However, a new employee who introduces a negative attitude into the workplace or doesn’t work well with their colleagues also easily qualifies as a bad hire.
Similarly, when a newly employed worker begins having attendance issues early on, that would commonly fall in the bad hire category. Not having the skills they claimed to possess is another outcome that would easily qualify.
Generally, all of those situations yield the same results. In most cases, productivity diminishes significantly, hurting the team, organization, and the bottom line. Additionally, the overall quality of work may also decline, causing a range of issues.
Finally, a bad hire always means lost time. The hours spent during the hiring process were essentially wasted, which is a cost many companies overlook.
How to Prevent Bad Hires
In order to prevent a bad hire, it’s important to understand what may cause one in the first place. When asked, 69 percent of hiring managers stated that a bad interview process was mainly responsible. However, 43 percent cited feeling the need to rush as a contributing factor, while 22 percent admitted they simply didn’t have the skills necessary to hire effectively.
Other potential factors included candidates lying about their qualifications, trouble finding qualified candidates, failing to account for culture fit, lacking the proper tools to find a right-fit candidate, and not completing a background check before hiring. For 25 percent of hiring managers, them overlooking warning signs of a potential bad hire was part of the issue.
Luckily, all of those difficulties can be resolved. First, robust screening tools are essential. This can include everything from thorough background and reference check processes, real-world skills assessments, and a multi-person interview team.
Additionally, focusing on a candidate’s attitude and culture fit, as well as their technical prowess, is a must. Having a strong onboarding and training program, regular employee check-ins and assessments, and offering new hires ample support can also make a difference. Abandoning traditional job interviews for job auditions could also be a wise move.
Finally, having adept recruiters by your side does make a difference. By partnering with a recruitment agency like Vincent Benjamin, you gain access to hiring allies that can ensure you find right-fit candidates that can help your company excel.
We’ll Help You Find the Best Candidates
If you are looking for a talented recruitment agency that can help you avoid bad hires, the team at VB wants to hear from you. Contact us to learn about our comprehensive services today and see how our candidate screening and selectionexpertise can make bad hires a thing of the past.