Cost of a Bad Hire 2026: What the Data Really Shows

Data as of October 2026. Sources: CareerBuilder and Harris Poll (2016, 2017), SHRM (2017, 2022), Gallup (2019), Center for American Progress (2012), Work Institute, Robert Half, BLS JOLTS (August 2026), BLS Employee Tenure (January 2026), Sackett et al. (2022). Updated October 2026.

How much does a bad hire actually cost?

There is no single official number. Every figure you see quoted comes from one of three kinds of sources: an employer survey that asks managers to guess, a review of turnover case studies, or a rule of thumb that gets repeated until it sounds official.

The most solid survey number is from CareerBuilder in 2016. Harris Poll asked 2,379 hiring managers and HR professionals between August 11 and September 7, 2016, and employers said one bad hire cost them nearly $17,000 on average.

A year later the same survey series came in lower. The 2017 CareerBuilder release put the average loss at $14,900 per bad hire, based on 2,257 hiring managers and HR professionals surveyed August 16 to September 15, 2017. Seventy four percent of employers said they had hired the wrong person for a role.

Where do the famous bad hire statistics come from?

Here is every commonly cited figure, traced as far back as we could get it. Note the last column: many measure turnover in general, not bad hires.

Is the Department of Labor 30 percent figure real?

We could not verify it. The claim that “the US Department of Labor estimates a bad hire costs at least 30 percent of the employee’s first year earnings” appears on many recruiting blogs, but none of the pages we checked link to a dol.gov page, report title or date. Until someone produces the original document, treat it as a rule of thumb of unknown origin, not a federal statistic.

Does SHRM say a bad hire costs five times salary?

Not in any SHRM page we could find. The most quoted source is a May 2017 SHRM bad hire article. It says recruiting, hiring and onboarding “can be as much as $240,000,” but that is a quote from Jörgen Sundberg, CEO of the agency Link Humans, not SHRM research.

The same article has a real “five times” figure, but it is about likelihood, not money: a 2015 Brandon Hall Group and Glassdoor study found organizations without a standardized interview process are five times more likely to make a bad hire. Somewhere along the way the internet turned that into “five times salary.”

SHRM’s own data is far smaller. A 2022 SHRM article reports an average cost per hire of nearly $4,700 and quotes employers saying total cost to hire can be three to four times salary. That multiple is an opinion quoted in the article, not a SHRM benchmark.

What does Gallup say about the cost of replacing an employee?

Gallup wrote in 2019 that “the cost of replacing an individual employee can range from one half to two times the employee’s annual salary,” and put total US voluntary turnover losses at $1 trillion a year. This is about any departure, not a bad hire. It is also the widest range of any source here, which is why it produces the biggest headline numbers.

What did the Center for American Progress study find?

The CAP turnover study by Heather Boushey and Sarah Jane Glynn (November 2012) reviewed case studies from 11 research papers. Typical turnover cost was 16 percent of salary for jobs under $30,000, 20 percent for jobs under $50,000, and a 21 percent median across all non executive roles. Estimates ranged from 5.8 percent to 213 percent, with executives at the top.

One caveat cuts the other way: only 2 of the 11 papers counted indirect costs like lost productivity and morale. So CAP is probably a floor, not a ceiling.

How much would a bad hire cost at my salary level?

Because the sources measure different things, the same role produces wildly different answers depending on which one you pick. Here is a $75,000 role run through each estimate.

The CareerBuilder figures are flat averages across all roles, so they do not scale with salary. Gallup’s range is so wide that the top end is four times the bottom. The CAP, DOL attributed and Work Institute percentages cluster between $15,750 and $24,975 for this role.

Percentage rows are Work Insiders calculations applying each published rate to the salary shown.

How did we build the Work Insiders bad hire model?

We broke a bad hire into five costs and used sourced inputs wherever they exist. Where no source exists, the assumption is labeled.

Example at $75,000: $4,700 recruiting, plus $2,885 onboarding (75,000 ÷ 26), plus $11,538 lost productivity (75,000 × 0.5 × 16 ÷ 52), plus $2,885 severance, plus $4,700 rehire equals $26,708, or 35.6 percent of salary.

Lost productivity is the biggest single piece at every salary level. That lines up with the 2017 CareerBuilder survey, where less productivity (37 percent) was the most cited consequence of a bad hire, ahead of time spent recruiting and training a replacement (32 percent).

Want to plug in your own numbers? Start with our cost per hire calculator for the recruiting line, then add the other components above.

How common is early turnover right now?

Bad hires usually show up as early exits. The latest BLS JOLTS release, published September 29, 2026 for August 2026, shows 5.1 million total separations (a 3.2 percent rate), including 3.1 million quits (1.9 percent) and 1.6 million layoffs and discharges (1.0 percent). Hires were 5.2 million.

JOLTS does not split separations by tenure. The BLS tenure survey for January 2026 fills part of the gap: 20.6 percent of wage and salary workers had been with their employer a year or less, and median tenure was 4.1 years.

On first year exits specifically, Work Institute says nearly one third of new hires quit within their first year, and that over 75 percent of the reasons employees leave are preventable. The page does not date these figures, so treat them as directional.

For the broader picture, see our quits rate by industry breakdown and the labor market trackers page.

What are the warning signs of a bad hire?

Employers in the 2016 CareerBuilder survey named the behaviors that told them a hire was wrong. Poor quality of work led at 58 percent, followed by a negative attitude (52 percent), not working well with others (51 percent), skills that did not match their claims (49 percent) and immediate attendance problems (45 percent).

Why do companies make bad hires in the first place?

In the 2017 survey, the top reasons were a candidate who lacked skills but seemed able to learn quickly (35 percent), a candidate who lied about qualifications (33 percent), hiring a nice person on a gamble (32 percent) and pressure to fill the role quickly (30 percent). A quarter admitted they ignored warning signs.

Managers pay for it in time. Robert Half found in 2012 that CFOs said managers spend 17 percent of their time managing poor performers, nearly one day a week.

How do you reduce bad hires?

The strongest evidence points to structured interviews. A 2022 meta analysis by Sackett, Zhang, Berry and Lievens in the Journal of Applied Psychology, summarized by SIOP, revised older validity estimates and found structured interviews had the highest mean operational validity of any common selection method.

That result reorders the classic ranking. Schmidt and Hunter’s 1998 review in Psychological Bulletin treated cognitive ability as the focal predictor; Sackett and colleagues argue that earlier work overcorrected for range restriction, which inflated the older estimates.

What should hiring teams change first?

Use the same job related questions for every candidate, score answers against a written rubric, and have more than one interviewer score independently. Add a work sample or job knowledge test where the role allows it, since both scored above cognitive ability in the 2022 analysis.

If you use AI to screen or score candidates, check the rules where you hire with our AI hiring law checker. Slow hiring has its own cost too; our time to hire data shows where the delays sit.

What does the cost of a bad hire mean for recruiters and staffing agencies?

For agencies, a bad hire is not just the client’s problem. Contingency agreements usually include a replacement guarantee period, during which the agency refills the role for free or refunds part of the fee. The length is a contract term that varies by agency.

A Robert Half Canada survey of 600 senior managers (undated; infographic marked 2021) is useful here: employers took an average of 11 weeks to terminate a bad hire and 5 more weeks to restaff. Eleven weeks is 77 days. If your guarantee runs 60 or 90 days, many bad placements surface right as the protection ends.

Use the cost data in client conversations. Showing a hiring manager that a $75,000 bad hire costs roughly $15,750 to $26,708 on credible methods makes a stronger case for a structured process than an inflated “five times salary” claim they can fact check. Pair it with our cost per hire benchmarks.

How we built this page

We traced each commonly cited bad hire figure back to the earliest page we could fetch, and recorded the year, sample and what it measures. Where a figure is widely attributed but not traceable (the Department of Labor 30 percent figure, and “five times salary” credited to SHRM), we say so.

BLS figures come from the JOLTS release for August 2026 (published September 29, 2026) and the Employee Tenure release for January 2026 (published September 24, 2026). The salary scenarios and the five component model are Work Insiders calculations, with every assumption listed in the tables above. All pages were checked in October 2026.

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