Making a bad hiring decision can be extremely costly to your business. Filling in positions with the right people is crucial to making your business work smoothly, but the wrong people cost you time and energy.
How Much Does a Bad Hire Cost?
A new hire costs a varied amount based on earnings, but for an employee who earns $100,000 a year, the average spend for that employee is around $250,000 as an initial outlay. Where do these costs come from? First, you have travel, hotel, and meal costs of workers who are hiring new employees. To find that perfect candidate, those employees have to be able to work wherever necessary, and that could mean travel. On top of that, new workers must go through training and orientation, testing, and potentially have relocation costs paid. As a business owner, you also have to consider the termination costs, unemployment costs, and the potential for legal fees.
If your new hire looks good on paper but ends up having to be terminated, all that money you outlaid is wasted.
According to Bradfort Smart, a hiring guru, the estimated cost of a mis-hire can be between four times the annual salary of a supervisor up to 15 times the annual salary of executives. That's why it's important to have a thorough hiring and interviewing process. Remember, it's not just your bottom line that is affected, either. Consider these potential losses before you bring on a new candidate, because you need to be sure you won't have to pay out of pocket for damaging acts.
- Negative publicity
- Endangering employees
Stealing from a company will end up costing you your bottom line plus the cost of the losses. Negative publicity can cost you your employee, customer sales, and your reputation. With endangerment, you could lose two employees or end up paying medical fees out of pocket with higher insurance premiums to come.
How To Make a Good Hire
To avoid these issues, make sure you get the right candidate for the job the first time around. Using a staffing or employment agency can help weed out potential applicants that may be a bad fit. Let professional recruiters help. Contact us at Artisan Talent to find the right person for the position you have open.