Nearly two-thirds (60%) of new hires worldwide are not working out to some degree, according to new research from Thomas International, the global talent assessment platform provider.
This is alarming seeing as in the UK alone, a bad hire costs businesses on average around £114,000 per employee, a sum businesses can ill afford as they battle economic turmoil.
The research also reveals that over three-quarters (76%) of businesses believe they have less than two years to fix their approach before they suffer competitive or further fiscal consequences.
The report “The Talent Time Bomb: The Countdown to Transforming Your Talent Culture” surveyed over 900 HR professionals across the globe, and found that while nearly half (49%) of hiring managers cite that their new hires are not working out due to ‘poor fit between the candidate and the role’, nearly three-quarters (74%) admit to compromising on candidate quality due to time pressure, most likely in response to the tight labour market.
But the desire for more progressive ways of recruiting and onboarding staff is strong. Almost two-thirds of HR decision makers (63%) want to evolve and adapt the way they approach recruitment, with 64% concerned they may currently be behind the curve in adopting a progressive talent culture.
Those surveyed also acknowledge that failure to evolve their talent culture will have a range of consequences, whether that’s ‘wasting money and resources’ (38%), ‘deepening the skills shortage challenge’ (38%), or ‘losing high-potential candidates’ (37%).
“The talent time bomb is ticking and the countdown is on”, comments Luke McKeever, CEO of Thomas. “With the economic climate looking more thunderous by the month, it’s feasible these timelines may get even shorter. Businesses must strive to ensure they’re ready for the storm to come.
“However, although the clock is ticking, racing towards a poor hire isn’t the right solution. Instead, businesses need to think about how they can hire in a way that speeds up productivity and prepares them to tackle challenges on the horizon. Alongside this, discussions need to be amplified on how to motivate internal hires, in order to alleviate the pressure on bringing in external hires to plug productivity holes.”
When asked what the most effective approach is to fix their recruitment, almost half of HR professionals (48%) are keen to implement more face-to-face interviews. Many HR professionals feel that failing to meet in person increases the likelihood of a poor fit; the desire for face-to-face interviews rises to 63% for those who’ve had a failed hire in the last two years. A third (34%) also cited psychometric testing as a solution, assessing behaviours, personality, aptitude, and emotional intelligence to measure one’s capability for the role.
There is also rising interest from businesses looking internally to fill open roles, with LinkedIn recently announcing that they will be making it easier for recruiters to identify and flag internal candidates for roles. Not only can hiring internally save time and money, but it can also serve as a way to develop and motivate existing employees, as companies look to become more resilient.
“Things need to change within the talent market, and they need to change now. Our research from 2021 revealed that over half (57%) of HR professionals stated that their recruitment is broken. And a year on, this figure has increased to 60%. It cannot continue to rise as we move into 2023. Recruitment needs to become more dynamic and move with the market, rather than behind it.” concludes McKeever.