What can a Bad Hire Cost your Company?
Hiring the wrong candidate for the wrong position can turn out to be a costly mistake for companies. According to a three-year study by Leadership IQ, approximately 46% of all newly hired candidates demonstrate a lack of skills within 18 months. With so much bad hiring happening, it’s important for organizations to realize the costs of bad hires so they make more thoughtful decisions during the process.
Here‘s what hiring an unfit candidate can cost your company.
Higher Turnover Rate
Hiring a new employee who doesn’t have the same values as your organization can be a source of discomfort for older employees. If your new hire’s attitude doesn’t align with company culture, it can lead to a significant decrease in morale, resulting in employees quitting the job.
Pressure on Your Budget Increases
An estimate by CareerBuilder stated that companies that made bad hires experienced average losses of $14,900 for each one. Replacing or firing an underperforming worker or an unfit employee doesn’t just cost you their salary, but also a number of other costs associated with them. This includes the cost that was spent on training that employee, a decline in sales, uncompleted projects that they were assigned and various legal issues.
Declining Employee Morale
Higher employee morale leads to higher productivity in the workplace. However, if the wrong people are added to the organization, overall employee morale declines. For employees to be productive, it’s essential to be surrounded by supportive colleagues. Additionally, if you hire a wrong person on the upper levels of the hierarchy or in a managerial position, the performance of subordinates will subsequently decline.
Damages the Reputation of Your Organization
It’s a well-known saying that employees are the internal customers of an organization. They will spread a positive or a negative word of mouth—depending on their experience— about the work practices your workplace, in the same way an external customer would if he likes or dislikes your product or service. Firing employees or bad hires is never considered a good move, and it can cause reputational damage to the organization. Moreover, it gets difficult for organizations to attract top talents, if they are known for hiring wrong individuals and bad practices.
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Contact our team today to discuss your needs or call +1 (888) 482-6019 to learn more about our hiring services.
Posted by: Mitchell Riley
OPS Staffing | + 1 (888) 482-6019