What does a bad hire cost you?

​It's a tale as old as time. You go through a lengthy hiring process, interview handfuls of candidates and finally offer the position to who you think is the perfect match. But, fast forward three months, and that same position is open once again. The hire didn't fit your company, he wasn't as skilled as he said he was, she didn't fit in with the company culture, whatever the reason, it can be a serious blow to your business.

Hiring the wrong employee can seriously affect your company.

With bad hires, you not only waste time, you waste a lot of amount of money too. Consider this: According to G&A Partners, the turnover cost associated with an entry-level, non-skilled position totals out to around 30 to 50 per cent of their annual salary. For supervisors this percentage rises to 100 to 150 percent. Other roles present considerable potential loss as well:

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This means that when you hire the wrong professionals for these positions, you risk losing thousands from your company budget. Why? Because the loss isn't just monetary. A bad hire can infect other areas of your business. A study conducted by Harris Interactive found that 41 per cent of companies reported lost worker productivity after a bad hire, 40 percent cited lost time due to the recruitment and training of a new worker and 36 per cent pointed to a negative impact on overall office morale.

With bad hires, you not only waste time, you waste a considerable amount of money too.

Addressing the causes of bad hiring decisions

The losses are considerable so why do bad hiring decisions keep on happening? While there is no solitary problem, the Harris poll respondents put forward some examples they have faced.

Over 35 per cent of participants attributed bad hiring decisions to a vacant position that needed to be filled quickly. Their lack of time forced a rushed decision that may have otherwise not been made.

A little over 20 per cent of respondents cited inadequate research into skill levels. These participants noted that they failed to test the job-seekers actual abilities and as a result hired an under-performing worker.

A failure to check references was also presented as a factor in bad hiring decisions – with 11 per cent of participants citing this reasoning. Without checking the listed references on a resume, employers run the risk of missing key details of past employment history or experiences. While CVs are written in a positive light, references can provide you with a much more accurate picture of what a given employee is like on the job.

Tips and tricks for reducing employee turnover

Knowing the most common reasons for bad hires helps us better understand what needs to be done to improve hiring decisions.

Make a list of the qualities you are looking for in your new hire before you begin interviewing.

1. Don't rush the decisions: When possible, hiring is not something that should be rushed. Rushed decisions mean missed details and missed information results in misaligned goals. If your open position isn't urgent, take your time with hiring. Sit down with as many candidates as possible, get different levels of management involved, make hiring an open discussion. When your process isn't rushed there is a much better chance you will find the right fit not just the available option.

You can take the stress out of the recruitment process by hiring a highly experienced recruitment firm.

2. Decide what you really need: Finding the right candidate starts with deciding what the right candidate looks like. Leaders should sit down and discuss what they need out of a new employee. Are hard skills or soft skills more important? Are you looking for experience or a fresh perspective? Whatever the questions, these answers will help you weed through applications to find the best possible options.

3. Hire a recruiting company: You can take the stress out of the recruitment process by hiring a highly experienced recruitment firm like Tradestaff. For businesses in the industrial industry, we have a considerable database of professionals just waiting for the right opportunity. Whether you need a temporary laborer or a permanent management advisor, we've got you covered. Our staff is dedicated to learning your company values and finding a hire that will stick. To learn more contact one of our Tradestaff reps today.