Cost of a Mis-Hire

The estimated cost of a bad hire ranges from 5 to 27 times the amount of the person's actual salary.

Mis-Hire Costs Include:

Hiring Costs:

  • recruitment, search, and advertising fees
  • outside testing, interviewing, background checks
  • HR department time and administrative costs (for all candidates interviewed, not just the one hired)


  • salary and bonuses multiplied by the number of years employed.
  • stock options, benefits, direct business expenses
  • training costs


  • severance fee (salary, benefits), lawyer fees
  • outplacement counseling fees
  • cost in lawsuits caused by person (EEOC, harassment, OSHA, etc.)

 Opportunity Cost:

  • loss of new business and ideas a great employee would have brought.
  • loss of production due to lower morale from other employees
  • value of a key customer who was lost or driven away.

Wasted Hours

  • number of additional hours spent dealing with mis-hires weak points:
    • patching things up with customers
    • re-doing or double-checking work.
    • increased workload due to mis-hire not being able to handle their own workload

The ability to attract, recruit, and retain great talent is the key to success for any business.

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