Today we’re diving into a topic that many business owners and hiring managers don’t think about enough: Why hiring and keeping the wrong people is actually worse than employee turnover. If you’ve ever struggled with a bad hire or hesitated to let someone go, this is for you. Let’s get into it!
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The Real Cost of a Bad Hire
Turnover is often seen as the ultimate business challenge. And yes, losing employees comes with costs—recruiting, training, lost productivity. But what if I told you that keeping the wrong employee can be even more damaging? A bad hire can impact team morale, hurt productivity, and even drive away your best employees. Think about it—how many times have you seen a great team member get frustrated and leave because they’re picking up the slack for someone who just isn’t a good fit? The wrong hire can do more damage than an empty seat.
According to a study by the U.S. Department of Labor, a bad hire can cost a company up to 30% of that employee’s annual salary. I bet it’s even higher than that. And that’s just in direct costs. When you factor in the impact on company culture, team performance, and customer experience, the price is even higher. It’s not just about dollars—it’s about the energy and focus your business loses when the wrong people are on board.
So why do companies hold on to bad hires? Sometimes it’s fear—fear of more turnover, fear of confrontation, or just the belief that ‘some help is better than no help.’ But is that really true?
The Hidden Consequences of Keeping the Wrong Person
Let’s talk about what really happens when you keep the wrong person on your team. First, they bring down overall productivity. If an employee isn’t pulling their weight, others have to pick up the slack. This leads to burnout and resentment among your top performers. Over time, this added stress leads to disengagement, and before you know it, your best employees are the ones leaving—not the bad hire.
Second, they create a toxic work environment. Negativity spreads, and a bad attitude from one employee can drag down an entire team. Employees are much more likely to leave a workplace due to bad culture than for better pay. Like I always say, every single person you bring into your team, keep on your team, or don’t keep on your team, will affect your culture. Every single person affects culture! A business is nothing more than the sum of its people!
Third, bad hires affect customer experience. If you have an underperforming or disengaged employee handling customer interactions, that reflects poorly on your business. One bad impression can cost you a loyal customer or even damage your brand's reputation. And in today’s digital world, all it takes is one negative review or social media post to cause long-term damage.
And let’s not forget the missed opportunities—every minute spent managing or trying to overcome a bad hire is time that could have been spent finding and developing the right one. Not only does a bad hire hold back their own role, but they also create bottlenecks and roadblocks for the entire team. When you finally do replace them, you’ll likely wonder why you didn’t make the change sooner.
How to Recognize and Address a Bad Hire
So, what can you do? The first step is recognizing the signs of a bad hire early. Watch for these red flags:
- Lack of accountability or ownership in their role
- Consistent underperformance despite coaching
- Negative impact on team dynamics
- Resistance to feedback and improvement
- Frequent excuses or blame-shifting
- Minimal enthusiasm or engagement with company goals
If you notice these warning signs, act quickly. Don’t let fear keep you from making a tough but necessary decision. Address performance issues head-on with clear expectations and support. Give employees a fair chance to improve, but if things don’t get better, don’t delay in making a change. The longer you wait, the more damage is done to your culture, your productivity, and your bottom line.
Remember, hiring is not just about filling a seat—it’s about finding the right person to contribute to your company’s success. And sometimes what might have been a good hire at some point turns into a bad fit down the road. People, organizations, and situations change. Leaders must be willing to make the necessary changes—when it becomes necessary.
Proactive Hiring Strategies to Avoid Bad Hires
Now that we’ve talked about the cost of keeping the wrong people, let’s flip the script. How do we prevent bad hires in the first place? It starts with being intentional about your hiring process. Here are a few key strategies:
- Define Success Before You Hire:What does success look like in this role? What behaviors, skills, and values are non-negotiable? This is why our recruiting team at BR1 creates an ideal candidate profile for every search we do for our clients.
- Improve Your Interviewing Process:Don’t just hire based on experience—assess for cultural fit, problem-solving ability, and motivation. Don’t be obsessed with resume experience. Not all experience is good experience!
- Get Input from Your Team:Sometimes, a second (or third) opinion can catch red flags you might miss during the interviewing and hiring process.
- Don’t Rush it:Don’t let being short-staffed force you into making a desperate and rushed decision. Again, it might not feel like it in the moment, but an empty seat is better than hiring the wrong person.
- Trust Your Gut:If something feels off during the hiring process, don’t ignore it. If you’re not excited about the candidate, or if the candidate isn’t enthusiastic about joining your team, there’s a pretty good chance it’s not a good fit and it’s not going to work out. If it’s not an enthusiastic “heck yeah!” than it should probably be a no.
The goal isn’t to eliminate every hiring mistake—you can’t. But by refining your approach, you can significantly reduce the chances of hiring the wrong person and dealing with the costly consequences.
Closing Thoughts
Hiring is hard, and turnover can be frustrating, but keeping the wrong person is a mistake that will cost you far more in the long run. The best thing you can do for your company, your team, and even that employee is to make smart hiring decisions and act when something isn’t working. Strong teams are built with intention, not just by filling positions.
Got a business question or challenge you’d like me to cover? Send me a message—I’d love to hear from you! Until next time, keep building a strong and engaged team!
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