Talent   //   November 29, 2022

HR teams admit fault for why most new hires aren’t working out

Most human resource departments across the planet are feeling deep buyer’s remorse, according to new research.

Thomas International, a talent assessment platform provider, surveyed 900 HR professionals globally and found nearly two-thirds (60%) of new hires are not working out. And the majority of respondents blamed themselves for effectively taking shortcuts that turned out to be dead ends.

Nearly half (49%) of hiring managers said recruits were unsuccessful because of a “poor fit between the candidate and the role,” and 74% admitted to compromising candidate quality due to time pressures in response to the Great Resignation and a tight labor market.

Luke McKeever, CEO of Thomas International, warned that worse is to come. “With the economic climate looking more thunderous by the month, it’s feasible these timelines may get even shorter,” he said. “Businesses must strive to ensure they’re ready for the storm to come. Although the clock is ticking, racing towards a poor hire isn’t the right solution.” 

It’s also costly when things don’t work out. The report stated that in the U.K., for example, one wrong hire costs businesses £114,000 ($170,000) on average. With the dark clouds of a global economic crash gathering, organizations cannot afford to mess up recruitment. McKeever added that HR teams must work out how they can hire “in a way that speeds up productivity and prepares them to tackle challenges on the horizon.” 

Amanda McCulloch, CEO of Aberdeen-headquartered TMM Recruitment, agreed and stressed the importance of improving recruitment and acclimatization processes. Referencing a previous Glassdoor report, she said: “Since great onboarding can improve employee retention by 82% and productivity by over 70%, it’s a business imperative to get it right.”

Disparity between expectation and reality

It seems that this post-job-move remorse hasn’t just been a burden on HR teams, but the new hires themselves. “We see a higher level of regretted choices because things have not worked out the way the candidate had hoped,” said Piers Hudson, senior director of Gartner’s HR functional strategy and management research team, referencing trends his organization’s proprietary data has highlighted. However, he added that overall, there has been an “elevation in expectations,” particularly among younger generations, that employers are finding it difficult to live up to.

Hudson said HR professionals have confided that they have found it incredibly challenging to keep younger hires happy. “We often hear that they expect much quicker progression, and HR leaders are worried that they can’t match those expectations.”

Other new factors are causing more significant disparity between expectation and reality for new hires. “A lot of the work around flexibility and hybrid working is shaking out, and organizations are still feeling their way,” said Hudson. And, for instance, if working policies change quickly after signing up, the new employee might feel disgruntled or even hoodwinked.

“Since most jobs are changing faster than ever, logically, if you are hiring for today, you will surely have it wrong tomorrow unless you hire someone who can grow.”
Steve Cadigan, founding CHRO of LinkedIn.

So what, then, should HR departments do to improve the likelihood of more good hires? For starters, TMM Recruitment’s McCulloch emphasized the importance of clear communication and language. “The terms induction, orientation, and onboarding are sometimes used interchangeably, which is confusing.”

She said it helps to consider onboarding new employees in three phases. First, induction is “the essential paperwork and compliance-related housekeeping” — including contract, payroll, and bank details — and also IT access and equipment, and a review of the company’s key policies.

Next, orientation is where they meet co-workers, their direct reports, tour the workplace and facilities, and gain a deeper understanding of the company’s culture and values.

Finally, ongoing onboarding builds on the first two phases with “a range of activities that help the employee learn about the business environment and gain the knowledge and skills they need to become an effective member of the company and perform in their job.”

McCulloch added that it should be a two-way process with regular reviews and continuity involving a variety of contacts and stakeholders. But, she added: “It’s iterative, too, with feedback from people going through the process used to improve it for future new employees continually.”

Kim-adele Randall, CEO of the U.K. business transformation consultancy Authentic Achievements, advised HR professionals to establish safeguards and more favorable terms if things quickly turn sour. “More background and reference checks will weed out candidates who are not qualified or who have a history of bad behavior,” she said. “And extend the probationary or trial period to see if the new hires are a good fit.”

Recruiting for the future

Not everyone is a fan of extending probation periods. Steve Cadigan, founding chief human resources officer of LinkedIn, was critical of this tactic. “Longer probation periods are lame and not the right approach,” he said. “Essentially, you’re building a policy because you suck at recruiting, and you will not get the best people to join if you try to pull off that bullshit.”

Naturally, a single piece of research never paints the entire picture and the Thomas International HR exec survey is no exception. And without historical data with which to compare the figures, it’s hard to determine whether or not the 60% of new hires not working out is higher or on a par with previous years, stressed Cadigan.

“Quality of hires has always been an issue, and I don’t think recruitment is more broken today than it has been previously,” said California-based Cadigan. “I work with thousands of firms across the globe and do not know many that even think about the quality of hires or measure performance – nor do I know of a standard measurement [to work out whether a new hire is a good fit]. So for a conclusion to be drawn here is highly subjective, albeit my gut agrees [with the findings].”

“More background and reference checks will weed out candidates who are not qualified or who have a history of bad behavior.”
Kim-adele Randall, CEO of the U.K. business transformation consultancy Authentic Achievements.

As a counterpoint, Cadigan cited the latest global employee engagement data from Gallup, which showed that 21% of employees were actively engaged in 2021, almost double the 2009 figure of 12%. Additionally, the percentage of “actively disengaged” employees has declined steadily from 27% in 2009 to 19% last year.

Generally, HR leaders need to change their mindsets and understand that now employees are likely to move on quicker than in previous times. A lack of collaboration alongside rigid job titles would score against organizations, continued Cadigan. “Since most jobs are changing faster than ever, logically, if you are hiring for today, you will surely have it wrong tomorrow unless you hire someone who can grow,” he added.

Albert Azis-Clauson, chair of the Association for the Future of Work, an employment resource for freelancers, developed this theme. “The best thing businesses can do is start to think about workers as talent and think about hiring as partnering with open talent,” he said. 

Azis-Clauson, who is also co-founder and CEO of the freelancer platform UnderPinned, pointed to the current recruitment models used by leading tech companies as an example of what best practice should look like. These methods usually involve compiling teams for specific projects, using a mix of internal employees and freelancers. “The idea of ladder-climbing, linear employment is dying fast,” he said. “And it’s dying fast because junior staff, talent, employees are way more skilled and have much better access to knowledge than anyone previously,” he added.

Highlights reel

Finally, back in the present day, Gartner’s Hudson shared some tips to improve the company culture around new – and old – hires. “When a person moves on, some organizations have a public celebration of their achievements, almost a highlights reel of their best bits,” he said. “I think this is a really smart idea with multiple upsides.” 

Not only does outlining key contributions in a visible way make the person departing feel respected and perhaps even loved – and with boomerang hires on the rise, this is important – but remaining colleagues feel appreciated, too. “They realize that they are, in fact, getting some development opportunities and the chance to build a career, so they will likely be more motivated to stay,” added Hudson.