The Real Cost of a Bad Hire
There is nothing quite like that moment when you find and extend an offer to the right candidate! You just know that bringing her on is going to have an awesome impact on your business and you can’t wait for her to get started. Only sometimes, that impact isn’t awesome. Sometimes when the new hire starts working, she doesn’t click with your team, or her qualifications are not all she told you they would be and she isn’t capable of doing the job for which she was hired. Or, even worse, she is great, but she leaves quickly putting you back to square one and more frustrated than you were at the beginning of the hiring process.
According to one study, it costs an average of $4,000 beyond salary and wages, to hire a single employee. That’s enough to make your head spin. And get this—in my experience, that estimate is on the low side. Of course, this figure is just an average. To get a really accurate picture of how much your company is spending on bad hires, use this Mis-Hire Calculator from the good people at Topgrading (WARNING: not for the faint-hearted!).
The above calculation includes the cost of the time it takes you and your staff to hire and train someone new. But it doesn’t include the loss in productivity that occurs when staff is spread thin and taken away from their regular work to help train someone new. Nor does this estimate include less tangible expenses like lost opportunity costs—just think of the other talented individuals you passed over, who could have been great assets to your company, in order to hire this person who is now leaving. So, although the real cost of making a bad hire is hard to measure using a simple formula, you experience each of these losses in a very real way.
We all know the stakes are high and yet, I’ve seen so many businesses make bad hires again and again. The thought process is easy to understand: when you need to hire, you need to hire ASAP. But, as a thriving business – small or large, you do not have enough staff or the specialized recruiters you might need to finding the exact right hire or hires to meet your need. So you go with what you’ve got – you decide to do the recruiting yourself. While the mentality behind your decision is easy to understand, there is a better way.
TalentFront is no regular recruiting agency. Our team consists of corporate entrepreneurs, with years of industry experience building a business from the inside out. Our recruiters understand firsthand what you are up against. We take the time to get to know you and your business, so we can find the best fit for your company among your industry’s top candidates. We believe that successful talent acquisition is about connecting with people, not just reading resumes or crunching numbers. So, we use your business’s network (not a pool of generic candidates who really work for TalentFront) as the candidate pool and we work with you to craft a customized recruiting plan. You will find that working with TalentFront is a lot like dancing a well-choreographed dance with a partner who knows your every step.
Each employee is an investment. You take reasonable steps to protect all of your investments, why not find someone with experience to help you make a smart investment in hiring employees? It just makes sense.