Cost of Bad Hiring Decision

(Sample CPH)
Sourcing	Cost
Job Posting at www.jobpostingsite1.com	$800
Job Posting at www.jobpostingsite2.com	$600
News Paper Ad	$250
Total	$1,650
Screening	Cost
Resume reviews (60 resumes x 10 mins to review each x $50/hour hiring manager salary and benefits)	$500
Telephone screen (30 calls x 20 mins to screen each x $50/hour hiring manager salary and benefits)	$500
Background check (1)	$49
Knowledge and skills testing
Cognitive ability testing (15 tests X $50/test)	$750
Total	$1,799
Assessment	Cost
Interview 1 (10 interviews x 2 hours x $50/hour hiring manager salary and benefits)	$1,000
Interview 2 (3 interviews x 2 hours x $50/hour hiring manager salary and benefits)	$300
Total	$1,300
Grand Total	$4,749

Administrative costs alone can be quite expensive. For example, the Institute found that average companies invest between $900 and $1,100 to find and evaluate a non-exempt employee, and between $8,000 and $9,000 for an exempt employee (the top 25% of companies in the source study invested $12,000 to over $20,000).

Internal costs refer to the cost of the company's personnel. The figure would be based on the time that an internal recruiter spends reviewing resumes and interviewing candidates, as well as travel expenses for recruiting trips, and overtime that is paid to other employees who are covering the duties of the as-yet-to-be hired person. External costs can include fees paid to cover the cost of an outside recruiting agency. Any money you spend on flying candidates in for interviews or to set up video interviews, as well as lodging and meals, and relocation expenses you may spend on the chosen candidate, should be included under candidate interview expenses. You may also want to include signing bonuses under this category. Finally, direct fees include costs associated with advertising, job or college recruitment fairs, and employee referral bonuses.

Cost of Vacancy - One aspect to consider is the cost of having a position lie vacant for extended periods of time, while you initiate, manage and conclude the hiring process. If your vacancy costs are high (i.e., it takes a long time to hire an employee), you will of course be losing the revenue that would be generated were someone employed and productive in the role.

Cost of Bad Hiring Decisions - Considering what you stand to lose from hiring poor performers. This cost is even more significant if you're hiring people who are truly incapable, contributing nothing to the company and perhaps even inhibiting others' success, leading to the need to terminate them and repeat the entire hiring process from scratch.

Opportunity Costs - The cost of a hire is the money lost because the hire wasn't made. Well recognized in MBA programs and broadly understood throughout many HR organizations, the simple concept is "opportunity costs." At its most basic, the opportunity cost associated with a particular hire is the productive revenue lost because the hire wasn't made.

MedDentJobs.com can provide HR with the speed and resources needed to recruit top talent. Not only are there more candidates to choose from, but the larger talent pool also increases the likelihood your company will find someone with the exact skills and experience level you’re is seeking.

MedDentJobs.com can personally recruit, conduct back ground checks, and check references and verifies the candidate's interest in the prospective company and position. This background work provides a tremendous benefit to HR by saving time and targeting only the best-qualified candidates. The time saved is itself worth the investment by using MedDentJobs.com; HR doesn’t have to pour through mounds of resumes and interview candidates that end up being unsuitable for the position. Prove to be better manager and willing to go "outside" the box for the best people and the quantity of people needed to meet your company's goals. Get Connected Today at MedDentJobs.com!!

RESOURCES

US Department of Labor
Society for Human Resource Management
The Saratoga Institute