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4 Reasons Employers Make Bad Hires—and What to Do Instead

One of the most important concepts for employers to understand is that many unsuccessful employee relationships fail long before they ever begin. It is tempting to blame the employee for any number of reasons, like bad behavior or attitude. But an employee termination that ends on bad terms is almost always the result of a poor hiring process. Are you avoiding bad hires? How can you be sure?

This blog will provide you with four tips for avoiding bad hires, to give you the best chance possible at attracting and retaining quality employees for the long haul.

Common Reasons for Failed Hires

1. Favoritism

Often, employers will turn to their unemployed friends and relatives to fill roles in their organizations, even if those acquaintances’ backgrounds are unrelated to the job. Employers rationalize this by focusing on the employee’s personality—they’re nice people, they’re smart, they work hard—without paying enough attention to whether their skills will allow them to do the work the job requires. Blindly assuming that a buddy you really like can do any job is a different story, and if the job doesn’t work out, you not only will have made a bad hire, but potentially damaged a cordial relationship.

How to Fix It: Focus on qualifications and experience. There is a lot to be said for trusting in the growth potential of employees with a proven track record of growth, but don’t confuse a desire to let quality people grow into a role with favoritism. There is also nothing inherently wrong with having a previous relationship with an employee before bringing them on board. Just make sure that your hire is what’s best for the business, and not what’s best for your acquaintance. Individual needs can shift at a moment’s notice—your organization’s will not. If someone is not qualified for the position you’re filling at the time you are filling it, you are truly not doing them a favor by giving them the job—and you certainly aren’t doing yourself one, either.

2. Skimping on Salary by Hiring Under-qualified Employees

The old adage is usually true: You get what you pay for. The price for experience, talent, and professionalism pretty much always comes in the form of a fair compensation package. You absolutely can save some money if you are OK with hiring someone lacking the proven chops to get the job done—and many employers are. There are occasional success stories of growth among these hires, but the much more common result is that underqualified employees simply can’t produce the quality of work the role demands. Any supervisor who has ever had to clean up the messes of an underperforming employee understands that all the money saved by hiring a cheaper employee will eventually go to waste in the form of double-work, loss of quality control, and, inevitably, the cost of recruiting a replacement.

How to Fix It: We realize it’s easier said than done to just say, “Pay people what they’re worth.” You’ve got payroll limitations just like everyone else. Instead, we’d urge you to consider the overall cost of making a bad hire, compared to paying more in compensation to a good one. A 2022 Society for Human Resource Management (SHRM) study revealed that the average cost of a bad hire for non-executive positions is $4,561 (this is just for direct costs like advertising, the cost of your HR department’s time, third-party agencies, travel expenses, etc.). The Department of Labor estimates that the average cost of a bad hire can equal 30 percent of the individuals’ first-year earnings—and that’s to say nothing of hidden costs, including the negative impact on other employees who will have to pick up the slack for the under-qualified candidate you hired. In most cases, hiring the best candidate you can afford, at a wage they deserve, is the best policy.

3. Not Doing Your Homework on the Candidate

We have been shocked to hear about the growing number of bad hires done without reference or post-offer background checks, with the only reason being that they take too much time. The SHRM study mentioned earlier also revealed that the average “time to fill” following a bad hire is 53 days. That means nearly two months without the production you would’ve gotten had you hired the right person in the first place. Not doing your homework on a candidate to find out about the kind of person you are bringing on board—both in terms of their personality and their work history—is a huge mistake. Similarly, post-offer background checks are one of those things a professional recruiter would never skip, but employers often do because they can feel like extra work.

How to Fix It: Just as no employee should ever sign up to work for an employer without doing due diligence on the kind of organization it is, what kind of supervisor they’ll have, or what they can expect out of a job environment, no company should blindly hire a candidate without following up on references and background checks. Unless you are prepared to spend two months fixing the mistake you made by hiring a person you didn’t do your research on, we recommend just doing your research. It can be tedious but it’s absolutely worth it.

4. Relying Only on Resumes

A major pitfall of hiring is the mindset that looks for employees that check all the boxes on paper. There’s a reason so many resumes make employees look good: They’re supposed to! The purpose of a resume is to list information the applicant chooses to share. Just because it all pops off the page doesn’t mean it aligns with the specific information employers need to know about the employee during the hiring process. 

How to Fix It: With few exceptions, it’s usually a good idea to include a job application in this process to make sure the employee’s skills and experience match what their actual job will be. An illustrious work history will make your candidate look like a star, obviously—but that shouldn’t be the end of your assessment.

There are many more reasons employers might make bad hires, but as recruiters, we see these four over and over. When looking for quality people, you simply cannot expect to consistently make good hires if you cut these corners. We get that it can be difficult to find the time to do things the right way, and we are here to help. Reach out to us if you could use a hand in hiring and we’ll help you figure it out!

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