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The Cost of a Poor Fit

Hiring the wrong employee can incur a tremendous cost on the employer. Not only training does cost money, but a poor fit may also reduce productivity and lower employee morale, among other hits to the bottom line.

The price tag for a poor fit is linked to the cost of employee turnover, which is between 16 and 200 percent of a person’s exiting salary, depending upon the strategic significance of an employee, their position their level within the organization, and the high-demand skills they may have.

A poor fit results in many costs to an employer. Here are just a few of the common costs associated with hiring the wrong employee:

  • Salary and other compensation-expenses related to the departing employee, such as severance pay
  • Declining productivity prior to the employee’s departure
  • Job advertising costs, seeking a replacement worker
  • Time costs associated with interviewing candidates
  • New candidate assessments
  • Reduced productivity in the position during on-boarding, orientation and training of the new recruit

The consequences of a poor fit aren’t inevitable. An employer can maximize the chance of the finding the right fit by following certain procedures, including job analysis, careful job description creation, effective interviewing and a job fit assessment.

The process begins by conducting a job analysis and producing a job description before you start interviewing candidates. This ensures that prospective employees understand exactly what the job they’re applying for entails, as well as the mental and physical abilities necessary to perform the required duties.

An employer can improve the candidate interview process by first identifying those key attributes that a person needs to succeed, and by seeking them out in the candidate pool. The interview process should include a job fit assessment.

Once hired, onboarding should be regarded as continuous process, rather than a single event. Onboarding can last up to 12 months depending on the complexity of the work place and position.

Background checks are also an important step, particularly in work at educational program, with children, or with adults who have special needs in any a treatment or healthcare environment. Background checks are mandatory in hospitals and in state licensed programs and even in some financial roles. Any sensitive, high security or direct care position requires a background check. The risks associated with failing to properly vet applicants justify the cost of a background check.

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Human Resources Report

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*Reproduced with permission from Human Resources Report, 32 HRR 453 (May 5, 2014). Copyright 2014 by The Bureau of National Affairs, Inc. (800-372-1033)

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