fbpx
 

Blog

The Soaring Cost of Bad Hiring Practices, Wrong Choices and Epic Fails

With onboarding costs running an average of $240,000, a new employee discovered to be a bad hire who must be dismissed or replaced can have devastating ramifications for a small to medium-sized business. HireBox says the ultimate responsibility lies with the employer, who must learn to how to avoid bad hires.

(Clearwater, FL) January 9, 2018—For HR managers, all of the recent good economic news in 2017—including an unemployment rate stable at 4.1% since October(1) and two consecutive quarters of 3.1% GDP growth(2)—can mean difficult hiring challenges. “The more competitive the job market becomes in this economy, the more effective a company’s hiring practices must be when selecting new personnel with the important soft skills of honesty and cooperativeness. Even one bad hire can have a catastrophic impact on a company,” says president and CEO Patrick Valtin of HireBox.com.

How catastrophic? Factoring in the costs of additional recruitment advertising, staff recruiter time, replacement personnel training, lost customers and lost business, impact on related team performance, disruption to incomplete projects, damage to employer brand, and potential legal or litigation costs, Jörgen Sundberg of employer branding company Link Humans calculates that the price tag for just one bad hire can be as high as $240,000. (3)

An improving economy can translate into a small but growing company’s need to speed up its hiring process, ready or not. Whoever is doing the hiring—whether it’s the owner, or a lone HR manager or recruiter—is often untrained and inexperienced. Compound that with rushed hiring decisions, and it’s very easy to make costly hiring mistakes. In a survey done by CareerBuilder, 22% of respondents felt they lacked the skills to effectively interview and hire people, and 43% said they had made bad hires because they needed to hire someone quickly.(3)

Rushing the hiring process is symptomatic of inadequate hiring skills, especially when there’s a shortage of personnel and facilities. “It’s imperative for a small to medium-sized company that the owner, HR manager and any other personnel involved in hiring be adequately trained in all the basic skills involved in effectively and legally screening, interviewing and testing job applicants,” says Valtin.

Such basic skills include always checking an applicant’s references; someone dishonest enough to lie or omit information on an application is likely to exhibit the same dishonesty in the workplace. Another important skill is knowing how to set clear expectations and objectives that can be quantified as the standard performance level required for continued employment.(4) Despite every effort made in this regard, bad hires will occur from time to time; however, due diligence in the hiring process can keep these to a minimum.

About HireBox.com

HireBox is a results-based testing platform utilizing legal quality control to give hiring missions the best outcome. Founded by Patrick Valtin, the job-matching assessments and internal evaluations provide vital information about potential and current employees to human resource professionals, executive coaches, management consultants and CPAs.

Specifically, the Recru-Tec™ pre-hire assessment can detect bully personalities. Based on an evaluation of over 25,000 applicants, Valtin concluded that no matter the talent, competencies or experience, the odds of a successful hire are very, very low if both the willingness and ability to contribute to the team’s success and happiness are not included in the selection criteria. For more information on HireBox and its successful tools for recruitment, assessment, hiring, onboarding and retention, visit www.hirebox.com.

About Patrick Valtin

Patrick Valtin is the president and CEO of No-fail Hiring and HireBox, as well as an international speaker and author. Considered an industry leader in recruiting, pre-employment assessment, personnel performance evaluation and human resources development, he has trained more than 125,000 people in over 35 countries over the last 29 years. Valtin was an international business consultant for the Belgian government between 1986 and 1988, later starting his Belgian company, U-MAN, in 1988. The company remains today the largest training company in the country for small businesses. Valtin received an MBA in International Business Studies from the Moore Business School at the University of South Carolina in 1982; his clients over the past 22 years have included Ford Motor Co., BMW, Mercedes, Motorola, IBM and Century 21. His book, No-Fail Hiring 2.0, is a bestseller on Amazon.

  • Brainerd, Jackson. National Employment Monthly Update.
  • US Department of Commerce, BEA, Bureau of Economic Analysis. “Bureau of Economic Analysis.” S. Economy at a Glance.
  • “The Cost of a Bad Hire Can Be Astronomical.” SHRM, 19 May 2017.
  • Fatemi, Falon. “The True Cost Of A Bad Hire—It’s More Than You Think.” Forbes, Forbes Magazine, 29 Sept. 2016,

 


Advice Disclaimer. This information is not intended to be a substitute for professional public relations or legal advice. Do not disregard professional legal advice or delay seeking professional PR or legal advice because of something you have read here. Contact an attorney to obtain advice on any particular legal issue or problem. Use of this Web site or any of its e-mail links do not create an agency-client relationship between JoTo PR and the user.