Don't underestimate the High Cost of a Bad Hire

?? One bad hire can ruin workplace culture, alienate your staff, and damage your company’s reputation. Indeed, in today's labor and skills shortage environment, small companies are rushing to hire talent...any talent, but there are long-term detrimental effects on these companies.

The average cost to unwind a bad hire is?$21,000 and hiring the wrong person can cost your business approximately 30% of the employee’s earnings in their first year, according to a new interesting research published by RedBalloon using data from the U.S. Department of Labor and calculation of RedBalloon economists with inflation adjusted dollars.

?A bad hire is not just costly...

In another research published by Robert Half , managers are forced to spend on average approximately 17% of their weekly work hours, or nearly one full day per work week, rectifying the errors caused by underperforming employees.

Reballoon researchers found also that many of our employers would prefer rather be understaffed than poorly staffed.

? A bad hire can quickly poison your Workplace Culture

A research done by CareerBuilder found that “less productivity”, “compromised quality of work”, “negatively affected employee morale,” and “the lost time and cost of recruiting and training a replacement” were listed as among the steepest costs of a bad hire. ??? So a bad hire?reduces employee morale.

SHRM also reported in late 2019 that 20% of America’s workforce have left a job in the past 5 years due to bad company culture, and 26% “dread going into work.”

?? You may end up losing your top performers as a bad hire can quickly poison your workplace culture, bringing a negative attitude and subpar performance that other employees quickly notice.

?Why do companies make bad hires?

It's also interesting to look at the reasons why companies make the wrong recruitment choices and the top reason is the ongoing shortage of skilled workers and employers feel pressured to settle for less than ideal candidates.

On average, hiring a new employee takes 30 hours for small businesses according to LinkedIn data, which any small business owner will tell you they just don’t have...

?? Finally, researchers conclude that a bad hire can permanently damage your business reputation and relationship with customers. The age-old approach to hiring and firing is no longer viable in today’s rapidly evolving labor market. Big companies can afford the expense of hiring, but for small business owners, managing human resources can be a daunting task

Thank you ?? RedBalloon ?researchers team for these insightful findings:

Andrew Crapuchettes Isaac Lopez

Dave Ulrich ?George Kemish LLM MCMI MIC ??

#futureofwork ?#peopleanalytics ?#hiring #productivity