Hiring Blunders Are Expensive, Managers Say
May 8, 2013 by UPI - United Press International, Inc.
CHICAGO (UPI) — Hiring blunders can be costly, especially so in Britain, a global survey of hiring managers and human resources personnel found.
There were several costs associated with hiring the wrong person, a Harris Interactive survey sponsored by CareerBuilder found. Potential revenue was lost, relationships with clients or other staff may have suffered or company morale may have taken a beating, CareerBuilder said.
On top of that, replacing a worker is also expensive.
Hiring managers in Britain indicated a poor hiring choice was the most costly in 2012 with 27 percent of survey respondents saying a bad hiring decision cost their company $77,544 or more.
In Germany, 29 percent indicated a bad hire cost $65,231 or more and in the United States about same percentage — 27 percent — indicated $50,000 or more was the price associated with making a poor hiring decision.
In India, 29 percent indicated the average hire that soured cost $37,150. In China, the cost exceeded $48,734, nearly half of the respondents — 48 percent — indicated.
In general, CareerBuilder said, lower morale at the company and the cost of hiring a replacement worker was the damage cited by hiring managers from the United States, while managers from BRIC countries — Brazil, Russia, India and China — were more apt to point to loss of revenue or productivity as the problem associated with a bad hiring choice.
At the top of the list, 88 percent of Russian employers indicated they had made a bad hiring choice. In Brazil, 87 percent indicated they had done so. In China 87 percent, in India 84 percent and in the United States 66 percent of employers indicated they had made a bad hire in 2012.
“Making a wrong decision regarding a hire can have several adverse consequences across an organization,” said Matt Ferguson, CareerBuilder’s chief executive officer.
“When you add up missed sales opportunities, strained client and employee relations, potential legal issues and resources to hire and train candidates, the cost can be considerable,” he said.
This survey was conducted online Nov. 1-30, 2012, within the United States, Brazil, China, France, Germany, India, Italy, Japan, Russia and the Britain with 400 to 2,611 respondents from each country, CareerBuilder said.
The results of the survey, it can be said with 95 percent certainty, include a margin of error of 1.9-4.9 percentage points.