The True Cost of a Bad Hire!
The Hiring Academy has an unwavering dedication to one ultimate goal: ensuring you hire the right person the first time and every time. Developing your own A to Z hiring process while proceeding through The Hiring Academy online courses is pain-free and some have even called it fun. Our system has taken all of the guesswork and finger crossing out of hiring a new employee. Not to mention, we are going to save you a bundle; alleviating those costly turnovers from new employees that just don’t work out. As an online membership site we’re always available to you. We always read your comments and address any questions you may have.
Excerpt from The Naked Interview: Hiring Without Regret:
“Consider first the exhaustive expenses of replacing someone with a new employee. In the United States, the National Labor Board estimates it costs between 1.5 to 3.5 times an employee’s annual salary to replace that person. That Board averages the cost of new hiring process alone at around $15,000 each time a company hires a new employee. It is easy to overlook the impact of that cost.
Examine the following items for greater insight:
HR staffing costs
Salary, of course
Any relocation costs
Employee problems with low morale
Potential customer problems
Lost profit margins
These areas vary from business to business, but the common thread remains the same. It’s expensive to hire, train, and replace. That cost is only one of the many reasons to do it correctly the first time.”
Some surveyed facts:
According to a survey of nearly 2,700 employers, 41 percent estimated that a single bad hire cost them more than $25,000, while another 25 percent responding said more than $50,000.
38% of polled employers said their top reason for making bad hires was needing to hire someone quickly.
A Bad Hire costs minimally $5,000.00! (Even with an $18hr employee) and only goes up from there.
Not including any Training Costs: If you are needing to fill a $50,000 salaried position and it doesn’t work out after one month, what would that cost you for that one bad hire? Most companies give a new employee longer than one month but will keep it at one month just to keep it simple.
$258 around 6% for Federal Unemployment taxes for the first $7000
$112 is on the low side (2.7%) State Unemployment taxes ranges anywhere from 2.7% – 9.6% for the first $9000
$60 1.45% for FICA taxes
$4,596 is the cost that an employer would have spent for a bad hire. Then they would need to start all over again with a new employee.
Hiring the wrong employee can be so extremely costly and time consuming. We don’t want anyone to make those mistakes anymore. Our clients that use our system say it is affordable and very successful for them.
We hope this helps you in your own hiring and growth process.