Research Finds that Hiring the Wrong Candidate Could Cost You £17,000
We all know that recruitment inevitably takes time and money, even if you recruit in-house. Unless the ideal candidate falls into your lap, you’re going to need to invest some resources into the search for the talent you need to fill a vital role and drive the business forward.
But what if you get it wrong? This is the question at the heart of all efforts to improve recruitment processes, such as here at Adria Solutions where accuracy is just as crucial as speed during a candidate search. If you appoint the wrong person, it will more than likely mean having to let them go and find a replacement after a certain amount of time. This means starting the recruitment process all over again, causing significant business disruption at the same time.
A new piece of research has now revealed the average cost of this nightmare experience for a typical organisation. The study by AXELOS, a venture dedicated to best practice solutions set up by the UK Government and Capita, found that it can cost around £17,000 if the wrong candidate is appointed. AXELOS asked 500 HR managers about situations in which they’ve hired the wrong candidate after advertising a role externally.
Where does this money go?
The average cost of £16,843 to an organisation if they hire the wrong candidate is accounted for by the following two areas.
- £7,810 – allocated to recruitment fees and advertising, sifting of applications, interviewing, induction and new candidate training. Also included in this cost is the first three months of salary for the average candidate.
- £9,033 – allocated to loss of productivity and disruption to key projects due to a poor work output by the candidate in question, as well as the costs of starting all over and recruiting a new person.
These costs inevitably vary from industry to industry, particularly where average salaries are at different levels. It also differed according to region. For those recruiting IT and telecoms roles, the average recruitment cost was found to be £11,847 while the cost of recruiting a replacement was £13,835. For media, marketing and PR roles, these figures were £7,807 and £10,288 respectively.
The total (recruitment and replacement costs) of hiring in the north of England was £16,257, while down in London it was £20,186.
Two routes to find the right candidate, first time
The AXELOS survey also highlighted a number of other relevant key statistics, including those that show how businesses aim to mitigate losses such as this. Around 42% of businesses surveyed are prioritising the training and up-skilling of existing employees to fill new roles, while 41% are recruiting entry-level roles and training candidates up to the required level once they are in place.
For those times when attracting external candidates is needed, organisations also need to sharpen up their recruitment tactics. A focus on accuracy when matching candidates to role is key, as well as eliminating wasted time (i.e. screening and interviewing unsuitable candidates) wherever possible.
If you need an IT, digital and technology recruitment specialist to improve your candidate search and reduce the chances of hiring the wrong person, you can rely on Adria Solutions. Please get in touch to tell us who you’re looking for and start the search.