Hiring the wrong person can damage a company's sales, productivity, workforce morale and customer relations.
That's the conclusion of a new CareerBuilder study, which found that bad hires have negatively impacted more than half of the employers in the 10 largest world economies.
The study defines a bad hire as someone who turned out to be a poor fit for the job or did not perform the job duties well.
Costs of Bad Hires
Among those companies that reported having a bad hire, 27 percent of
U.S. employers reported that a single bad hire cost them more than
"Making a wrong decision regarding a hire can have several adverse consequences across an organization," said Matt Ferguson, CEO of CareerBuilder.
"When you add up missed sales opportunities, strained client and employee relations, potential legal issues and resources to hire and train candidates, the cost can be considerable. Employers are taking longer to extend offers post-recession as they assess whether a candidate really is the best fit for the job and their company culture."
In the Eurozone, bad hires were most expensive in Germany, with 29 percent of employers there reporting costs of 50,000 euros ($65,231) or more.
In the United Kingdom, 27 percent of companies said bad hires have cost them more than 50,000 British pounds.
Three in ten Indian employers (29 percent) reported that the average bad hire cost them more than 2 million Indian rupees ($37,150), and nearly half of the surveyed employers in China (48 percent) reported costs exceeding 300,000 CNY ($48,734).
The global survey, conducted online by Harris Interactive in November 2012, included more than 6,000 hiring managers and HR professionals in countries with the largest gross domestic product.
BRIC Countries Bearing the Brunt
Brazil, Russia, India and China — where more companies are hiring than in the rest of the world — are bearing the brunt of bad hires, according to the CareerBuilder survey.
"The BRIC countries generally were more likely to report a variety of negative effects tied to a bad hire such as productivity and revenue losses, while U.S. [firms] ranked high in citing an impact on employee morale and cost to recruit and train another worker," CareerBuilder explained.
"European countries ranked lower in almost every category, which may in part be attributed to slower hiring in those markets."