Businesses paying the financial consequences of bad hiring
The cost of a bad hire is estimated to be three times higher than the salary paid, demonstrating the responsibility for HR of getting hiring right.
A new study by the Recruitment & Employment Confederation (REC) has found across the UK, poor recruitment strategies are costing businesses productivity and impeding a vital COVID-19 recovery boost to the economy.
The Recruitment and Recovery study said that seeking expertise from recruitment and staffing firms could increase UK productivity by £7.7 billion if they effectively put the right people into the right jobs.
Getting recruitment right therefore has the potential to be a huge driver of recovery yet only only half of Britons (52%) said that companies in the UK are recruiting efficiently.
HR teams therefore need to work hard to make sure the recruitment process delivers productive and engaged staff.
COVID-19 has altered recruitment patterns over the past year, with one in four (28%) large businesses now likely to explore hiring people who do not live close to the office in the future.
Mark Hendy, founder of HR consultancy Hendy HR, said that the collaborative partnership between HR and recruiters has never been more important, due to the uncertainty COVID-19 has created.
Speaking to HR magazine, he said: “There is a common goal and interest between all stakeholders in this process, HR, the recruiter and the new recruit themselves.
“That goal is to be assessed, selected and onboarded in a professional and positive way that establishes and strengthens the psychological contract at play.”
Hendy added that if HR and recruiters continue to follow good, moral and ethical recruitment practices, they will find the productive staff they need.
“If HR and recruiters are transparent and honest in their dealings with the candidate, and support the new employee into the business, they will feel welcomed, comfortable and effective from the get go,” he said.
However, half of small businesses (50%) said that increasing the diversity of their workforce was not a priority. Just 20% of businesses overall made sure to use diverse panels and 26% anonymised CVs.
The REC also advised employers to draft a plan for supporting workers beyond their initial employment to help them progress.
It also recommended that HR make use of recruitment agencies to help develop and improve internal processes for training and progression.
Neil Carberry, chief executive of the REC, said: “With company and worker needs changing, and the country moving towards recovery from COVID-19, getting recruitment right will play a vital role in boosting the economy.
“We’re calling on the government to work with the REC on the Plan for Jobs, ensuring that all forms of employment are considered in government thinking, so families all over the country can feel the benefit that good recruitment brings.”
The REC commissioned independent consultancy Public First to measure the recruitment industry’s economic and social impact by launching asking the views of 2,000 adults in Britain, alongside 500 businesses and 11 REC members.