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One in Five Hires Are “Bad” Hires

Part 2 of our early-findings series for CEB Recruiting’s 2013 feature research.  (See Part I.)

We asked thousands of hiring managers globally a simple question:  what percentage of hires on your team do you think are “bad” or “regretted decisions”?

The answer we got was very surprising:  more than one in five.  Hiring managers are admitting that 20% of their team shouldn’t have been hired in the first place.

The underperformance and new hire turnover that comes from making bad hires has significant costs.  There are the hard costs that hit Recruiting; essentially for every bad hire that leaves, Recruiting’s cost to fill (and refill) that position doubles.  But there is also the cost to business profitability and “soft” costs, like lack of trust in Recruiting among hiring managers and line leaders.

We’re in the middle of calculating the true costs of these bad hires.  What do you think is driving these poor hiring decisions?

The team here at CEB Recruiting is hard at work on our feature insight for 2013 on Selecting High-Quality Hires in Today’s New Work Environment.  CEB Recruiting members can register to see the first release of the findings in our webinars on 6 June and 20 June.  Heads of Recruiting in the membership can register for one of our Annual Executive Retreats to spend a day with their peers discussing this topic.

11 Responses

  • Arminius Aurelius says:

    I started in business in 1969 , bought 2 bankrupt restaurants . Over the years I bought 2 more bankrupt restaurants and 1 profitable one. Every one succeeded because I put in 12 hours a day for 34 years. I had managers who got a weekly pay check plus a percentage of the bottom line profits . My Senior manager who was with me for 10 years was given 25 % of the bottom line profit. But once I semi retired and spent 6 months in Florida , he slacked off, costs went up and profits went down . Many of the other employees put in minimal effort. It is a tough business . I long ago came to the conclusion that a fairly high percentage of workers are duds, is it any wonder that there are so many losers out there.

  • Donald says:

    Logically, if 20% of employees were regrettable hiring decisions that have continued employment at the organization, it is likely that at least 20% of the Managers were also bad hires. It may be that 20% of Managers which is responding to the survey? The cost to replace a bad hire should be quite low, if the employee in question is as bad as the Manager claims.

  • Strulas says:

    A bad hire somewhere is a good hire somewhere else. It is often a matter of motivation. If the culture is not a fit for an individual, it is hard to extract enthusiasm for the job. Often lazy or unproductive people lacked motivation, which is a manager’s job to create. With the right creativity and focus, a good manager can turn the worst hire into a star. Lets look at the line managers and review their performance as well. It does take a community to raise a child, and it does take everyone in a corporation to ensure its success, not only the recruiters.

  • Dale says:

    I work for a upscale hotel chain and I have seen many employees come and go over the years. Though I am not in management (and wouldn’t want to be), I tend to agree with these posts so far. Number one is that about 20% of new hires are ‘duds’ and secondly, about 20% of managers are ‘duds’. It tends to work both ways.

    One of the big problems that they face from my perspective is that many of those ’20 per centers’ are often easily identified after only a few weeks on the job. My advice to our managers recently was, let’s get rid of those people early on before they inevitably become major problems later on and eventually are fired anyway. My thoughts are that people being people, the hiring managers may think that by firing someone that they themselves have hired,that firing them ‘early on’ would make themselves look bad (ego?). If they could let go of that mentality and dismiss these bad apples early on, a lot of problems that these people cause could have been avoided and there would also be less stress amongst their co-workers. Thanks for your posts and I will continue to read them and hopefully learn from you folks some things that I can pass on to our management team.

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