Staggering Costs Of A Bad Hire


As per a recent study by Harvard, as much as 80% of Employee Turnover is due to “BAD HIRE”.

Bad hires could cost a Fortune for companies.

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First of all, a lot of time & resources would have been utilised to recruit a new employee right from the Interview Process, the Induction all way to the Training and finally getting the employee set in a routine where they are clear about what are their tasks and how to execute them.

In some cases, a lot of money is also spent for covering the Travel & Accommodation costs of Senior Level Hires to get them to attend the interview and have them go through some additional training after they join the company.

These are costs that all of us are aware of.

In addition to this, there are other “Intangible Costs” which the company suffers due to Bad Hires:


Once a new person gets hired, a lot of time is not only spent in training the new hire but also managing conflicts between the New Hire as well as the existing staff.

Roughly about 17% of time is spent by Supervisors managing poorly performing employees which as approximately 1 day in a week.

About 11% of Bad Hires result in fewer sales.

On the whole, the Productivity of the Organisation gets drained.


As mentioned above, in addition to the Travel, Accommodation & Training costs that some companies suffer, the biggest financial implication is paying their Salaries in itself.

This financial cost could stagger upto Millions of Dollars of loss depending on the Seniority of the Position.

According to the US Department of Labour, the financial cost of a bad hire could be as high as 30% of the potential employee’s first year earnings.


While trying to rectify the error of hiring the wrong employee, other team members may be disengaged and dissatisfied especially if this bad hire has been able to build good rapport with his/her team members in spite of his/her poor performance at work.

Usually bad hires do not get along with the other employees and even in this scenario, other employee morale could get affected.

Its like one rotten apple in a basket of fresh apples.


In today’s world, everyone is connected to the everything 24/7. There are enough and more portals online to bad mouth anything you want.

So, in cases like this, we need to keep a close watch on the information being shared by this bad hire as he can publicly share whats working and whats not working in your organisation with authentic reviews from the employees themselves.


It is imperative that you take your time to evaluate and assess candidates before hiring them as per the required parameters by your organisation in order to eliminate all the above costs.

One of the major reasons for Bad Hires is a “Mismatch between Job Description and the Actual Role” of the employee once he/she is hired.

If expectations are set right up front and the Actual Roles & Responsibilities for a particular position are clearly discussed with the Candidate before hiring, then we can avoid whats called as the “Buyer’s Remorse” for our new hires.

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