Cost Of
Cost of a bad hire
Salary paid for low output, recruiting again, the replacement's ramp-up, and the team's time. One-off, not per year.
What a bad hire costs, end to end
The salary paid to someone who did not work out is the visible part of the bill and rarely the largest. Hiring again costs a share of salary in fees, ads and interview time; the replacement produces little while ramping up; and through all of it the team and the manager spend hours on reviews, rework, handovers and conversations.
This calculator adds those four lines into one number. CareerBuilder's 2017 survey put the average self-reported cost of a bad hire at $14,900; SHRM Foundation figures put direct replacement costs at 50–60% of salary and total turnover cost far higher. Your inputs decide where you land in that range.
How the number is built
- Salary paid
- loaded salary × months until they leave ÷ 12 — what the employer actually spent on the time.
- Hiring again
- salary × recruiting cost percentage (default 25%: agency fees, job ads, interview time).
- Ramp-up
- loaded salary × ramp months ÷ 12 × (1 − output during ramp). Half output for three months is the default.
- Team time
- hours per week the team and manager spend on the hire × weeks × fully-loaded hourly cost.
When to use it
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Arguing for a paid trial or an extra loop
The receipt puts the one-off cost of a bad hire next to the cost of one more interview week. The comparison usually ends the argument.
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After a departure, before the backfill
Pricing what happened is the fastest way to get agreement on changing what happens next — scorecards, references, a probation check-in that actually happens.
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Sizing an onboarding investment
Better onboarding shortens ramp-up. Shorten the ramp months in the calculator and the saved amount is the budget you are arguing for.
Questions
How much does a bad hire cost?
It depends on seniority, how long the person stayed and how hard the role is to fill. This calculator prices the four components — salary paid, hiring again, ramp-up and team time — so you get a figure for your role rather than a generic average. Published estimates run from around $15,000 to well over a year's salary.
Is the 30%-of-first-year-earnings rule real?
It is widely repeated and usually attributed to the US Department of Labor, but the primary source is not locatable. Treat it as a rule of thumb, not evidence. The receipt shows your result as a percentage of salary so you can compare against it honestly.
Is this a one-off or an annual cost?
One-off. Unlike the other calculators, the total is the cost of a single event, so the receipt is marked ONE-OFF rather than per year.
What recruiting percentage should I use?
Around 20% of salary is a reasonable baseline for in-house hiring; agency-led hiring commonly runs 20–30% of first-year salary in fees alone. Include interview time if it was significant.
Does it count lost customers or team morale?
No. Those are real and often the largest costs, but they cannot be estimated honestly from a form. Everything the calculator shows is arithmetic on inputs you can defend.