Why Hiring the Wrong Employee Is One Expensive Mistake

From Associations Now, a publication of the American Society of Association Professionals, written by Ernie Smith.

A recent survey from CareerBuilder suggests that it can cost employers thousands of dollars to make up for an employee who isn’t a good fit. Observers suggest that the problem might be with the person doing the hiring as much as the employee.

We all want to make sure we hire the right person, but sometimes that doesn’t happen—the person isn’t a fit for the role or doesn’t grasp the organization’s needs.

And when an organization gets that wrong, it can get costly—very costly. One recent survey from CareerBuilder put the cost of making a single wrong hire at $14,900 in the past year, a situation that roughly three-in-four employers have dealt with in the past.

The survey, conducted online by the pollsters at Harris, noted that many respondents felt that bad hires had affected productivity (37 percent), cost the employer precious time (32 percent), and hurt the quality of the organization’s work (31 percent).

The report noted that the most likely factors behind the failure of an employee included poor work quality (54 percent), poor attitude (53 percent), work conflicts (50 percent), and attendance problems (46 percent).

Most interestingly, skills deficiencies were a major factor in many cases: In cases when a company made a bad hire, the employee didn’t have the necessary skills (35 percent), or lied about their qualifications (33 percent). And when a worker’s skill didn’t match their claimed abilities, as was the case 45 percent of the time, it often was seen as a sign of a poor hire.

So what’s the reason for bringing on a bad hire? Often, it may lie not with the employee, but the manager, who may not have the right skills for interviewing a potential hire. Arte Nathan, a human resources advisor and founder of The Arte of Motivation, recently told the Society for Human Resource Management that it’s important to consider a person’s interviewing and hiring skills.

“Instead of blaming the person who was hired, we need to blame those who are doing the hiring,” he told SHRM. “There is an assumption that because someone is a manager, they know how to interview and hire the right person for the job. Hiring managers need to know what they are looking for [and] how to ask the right questions, discern candidate responses, and get the right person for the job.”

The recruiting firm Robert Half likewise made the case that it’s easier to hire correctly the first time around, rather than trying to fix an on-staff problem. The firm estimates that it takes 17 weeks to resolve a bad hiring decision, including nearly nine weeks to let the person go.

“The wisest hiring managers put in the time and effort on the front end to make sure they have the best available pool of applicants for every job opening,” the company explained in a blog post earlier this year. “And determine whether they have good procedures in place for evaluating candidates.”

Of course, things could always be worse: You could be replacing someone who you actually want to keep. That, according to the CareerBuilder survey, comes at a cost of $29,600 per employee this year.

 

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