Cost of a Bad Hire Calculator
Most hiring budgets only count the agency fee. That is usually the smallest line. Put your own numbers in and see what a hire that did not work out actually cost, with every assumption visible and editable. Nothing is sent anywhere.
Your numbers
Defaults are a mid-level Indian role. Change anything that does not match your situation.
Estimated total cost
—
- Salary paidTo someone who did not work out—
- Cost to recruit themFee, ads, or internal time—
- Lost output during ramp-upCounted at half productivity—
- Vacancy costWork not being done at all—
- Management & interview timeCosted at the managers' own rate—
- Cost to recruit againYou pay for the replacement too—
How this is calculated. Salary is monthly CTC times months served.
Ramp-up loss counts the ramp period at half productivity, which is deliberately
conservative. Vacancy cost values an empty seat at the role's own monthly cost.
Management time is costed at the managers' actual hourly rate, assuming 22 working
days and 8 hour days. Recruitment cost is counted twice, because you pay to fill the
seat and then pay again to refill it.
There is no industry multiplier baked in and no study being quoted at you. Every
input is yours and every assumption is stated. Treat the output as an order of
magnitude, not an invoice.
The agency fee is the cheapest part
Which is exactly why choosing on fee alone is expensive.
Run the calculator with a realistic set of numbers and the recruitment fee usually lands somewhere between a tenth and a fifth of the total. The expensive lines are the ones nobody invoices you for: the salary paid to someone who was never going to work out, the months the seat sat empty, and the management hours spent on a problem that a better-defined role would have prevented.
That is the case for spending more time before the search, not less. Most failed hires trace back to a role that was never properly defined rather than a candidate who was badly sourced. A scorecard written with the hiring manager before sourcing starts costs an hour. The alternative is on the screen above.
Frequently asked
How much does a bad hire cost in India?
There is no single number, which is why this calculator asks for your figures rather than quoting a statistic. The cost is made up of salary paid to someone who did not work out, the cost of recruiting them, the productivity lost while they ramped up and then disengaged, the management and interview time spent, and the cost of doing it all again. For a mid-level role on 12 lakh CTC who leaves at month six, the total commonly lands between one and two times annual CTC once every component is counted.
What is the biggest hidden cost of a failed hire?
The vacancy period, both before and after. A role sitting open is work not being done, and it is rarely counted because no invoice is raised for it. The second largest is management time: the meetings, the performance conversations, the re-interviewing, none of which appear in a recruitment budget.
How do you reduce the risk of a bad hire?
Most failed hires trace back to a role that was never properly defined rather than a candidate who was badly sourced. Writing a scorecard with the hiring manager before sourcing begins, interviewing culture fit as behavioural history rather than hypotheticals, and staying engaged through the notice period all reduce it materially.
Is this calculator storing my numbers?
No. Everything runs in your browser. Nothing is sent to a server, nothing is logged, and there is no form to fill in before you see the result.
Rather not run this calculator again
We define the role before we source it, screen every candidate against a scorecard agreed with your hiring manager, and stay engaged through the notice period. Tell us what you are hiring for.
See also: Recruitment agency in Pune · Hiring advisory · Talent acquisition firm in Pune