Avoid making bad hires.
More than one in four companies—28 percent—do not conduct background checks on all new employees, a CareerBuilder survey has found.
The survey, which polled hiring managers and HR professionals in the private sector, also reported that 75 percent of employers have hired the wrong person for a job. More than half realize their mistake within the first three weeks of hire, while 20 percent say they know it's a bad fit within the first week.
Notably, 49 percent of employers reported that the bad hire's skills did not match what he claimed to be able to do when hired, and 37 percent report that the candidate lied about his qualifications—issues that may have been uncovered during a background check. Of the 72 percent of employers who do conduct background checks, 62 percent confirm employment, 50 percent confirm education, and 38 percent check licensing.
Additionally, employers reported experiencing several behavioral and performance issues with bad hires. Fifty-eight percent said that the employee didn't produce the proper level of work, while 45 percent said the employee had immediate attendance problems. Bad hires also did not get along with clients and co-workers; 38 percent of employers said that customers complained about the employee and 51 percent said that the employee didn't work well with others.
Hiring the wrong person can have a significant financial impact, the survey found, depending on the company's size. For businesses of 500 or fewer employees, a bad hire can cost them $11,000, while a bad hire can cost $24,000 for businesses with more than 1,000 employees. Employers also cited less productivity (36 percent), compromised quality of work (33 percent), and negative morale (31 percent) as the top three nonfinancial ways a bad hire affected their business in the past year.
"If an employee isn't well-suited for the job or has a bad attitude, the time they spend not working could significantly impact your bottom line. That's why it's so important to make sure qualifications are substantiated," says Ben Goldberg, CEO of Aurico, a CareerBuilder company.