Bad Hire Cost Calculator
The cost of a bad hire is much more than the salary. Add what you spent to hire the person, the output you did not get while they were in the seat, severance, the months the seat sits empty after they leave, and what it costs to hire again. Use the free calculator below to put a dollar figure on it for your own role.
Bad hire cost calculator
| Cost | Amount |
|---|---|
| Cost to hire them | $20,000 |
| Onboarding and training | $5,000 |
| Pay for output you did not get | $56,250 |
| Severance or settlement | $0 |
| Lost output while the seat is empty | $37,500 |
| Cost to hire the replacement | $20,000 |
The numbers shown first are an example only. Replace them with your own. Lost output is valued at what you pay for the role, which understates the loss for sales and revenue roles and for leaders whose decisions affect a whole team.
How is the cost of a bad hire calculated?
The calculator adds six costs:
- Cost to hire them: ads, assessments, interview travel and any recruiting fee.
- Onboarding and training: the money spent getting them up to speed.
- Pay for output you did not get: monthly pay (plus benefits, if entered) times months in the role, times the share of the work they did not deliver.
- Severance or settlement: anything paid on the way out.
- Lost output while the seat is empty: monthly pay times the months until the replacement starts.
- Cost to hire the replacement: running the search again.
Worked example: a $150,000 role, filled for 9 months by someone delivering half the expected work, with $20,000 to hire, $5,000 to onboard, 3 months empty and $20,000 to hire again, costs about $138,750. That is close to a full year of pay, before counting the time managers spent on the problem or any damage to the team.
What costs does this calculator leave out?
- Management time spent coaching, documenting and replacing the person.
- Lost customers, deals or projects that stalled.
- Good people who left because of the bad hire.
- Legal costs if the exit is contested.
These are real but hard to price, so the result above is a floor, not a ceiling.
How do you lower the risk of a bad hire?
Agree on what success looks like before you interview, test candidates on real problems from your business, weigh culture fit as heavily as the resume, and check references beyond the names the candidate gives you. Our full guide covers the steps: How to Avoid a Bad Executive Hire. To compare candidates side by side, use the free Executive Interview Scorecard. To price the time a seat stays open, use the Cost of a Vacant Position Calculator.
At Riderflex, finalists are vetted through video interviews conducted by current C-level executives with 30+ years of operating experience, candidates are matched to your culture, and you get a progress update every week on every search. Talk to Riderflex or call 888-964-5876.
Frequently asked questions
How much does a bad hire cost?
It depends on the salary, how long the person stayed and how long the seat sits empty afterward. For a $150,000 role held for 9 months, the total can come close to a full year of pay. Enter your own numbers in the calculator above to see your figure.
Why does a bad executive hire cost more than a bad junior hire?
Executives earn more, searches take longer, and their decisions affect whole teams, customers and strategy. The costs this calculator leaves out, like lost staff and stalled projects, are usually largest at the leadership level.
Is this calculator free?
Yes. It runs in your browser, needs no sign-up and does not store what you enter.