One Bad Hire Can Bankrupt A Business, Studies Show
Do you know the real cost of a bad hire? The popular online hiring platform ZipRecruiter.com does. And the numbers indicate that bad hiring decisions are placing most American companies in jeopardy of swift financial ruin.
While everyone knows that poor hiring choices are expensive, the actual numbers are staggering: Research shows even one bad hire can cost up to 7x an employee’s annual salary (including benefits).
So, for example, hiring the wrong middle manager (at $50,000 per year) can easily cost your company well over a quarter million dollars, while a high level manager can set you back a million dollars or more.
The research also reveals the following sobering statistics:
The average settlement of a negligent hiring lawsuit is nearly $1 million
Negligent hiring cases have had verdicts costing up to $40 million
Employers lose more than 79% of negligent hiring cases
Many companies consider ZipRecruiter.com their secret weapon in a business climate where small businesses, and even Human Resource departments in larger companies, are suffering from a lack of resources, budget and staff, making it tougher than ever to find top talent to fill key positions.
Not only is ZipRecruiter.com aware of these problems—through its radical streamlining of the online recruiting process, the company has helped tens of thousands of its clients make better, faster and easier hiring choices by enabling them to post a job on over 40 leading job boards with one click, while managing all applicants through a simple online interface.
Another crucial factor fueling the many hiring mistakes being made is the fragmentation of the online jobs market. The huge number of available jobs sites means both recruiters and top applicants are missing opportunities to connect with each other.
“There are so many great jobs boards out there that it’s difficult to keep up with them all,” said Ian Siegel, CEO of ZipRecruiter.com. “Recruiters who post jobs to only one or two boards run the risk of missing top candidates, yet those who utilize every relevant board will spend hours posting jobs and organizing applicants. It’s a lose-lose situation that we decided to change.”
While simultaneous posting to multiple job boards is ZipRecruiter.com’s most popular feature, it isn’t the only way the service helps prevent businesses of all sizes from making disastrous hiring mistakes. For example, their “candidate screening interview” uses a customizable online quiz that allows hiring managers to place real world business questions directly into the online application. This provides an easy and efficient way for hirers to size up an applicant’s knowledge level, and quickly eliminate unqualified candidates.
“I was very pleased and also surprised by the large volume of candidates that we received beginning almost immediately after our posting, most of them being highly qualified for the available positions,” said Lisa Weeks, owner of Love Thyself Day Spa. “With such a large response, the opportunity to post preliminary interview questions as well as rank the candidates was very beneficial.”
Steve Caldwell, CTO of CampusExplorer, agrees: “The part that hooked me was the candidate screening. We only asked four questions and the best candidates literally leapt out at us. I wound up reading just a handful of resumes.”
In all, over 100,000 business have chosen ZipRecruiter.com to help them avoid costly hiring mistakes—including NetFlix, Ford, Wells Fargo, Target and PayPal. For more information, visit ZipRecruiter.com/blaze