We asked our South Island Delivery Manger Rachael Tobeck to share how the real costs of a wrong hire can play out for employers and her practical tips on how to get the best match for a role and team culture when you’re hiring.
If you’ve ever made a hiring decision and had that nagging feeling early on that it just wasn’t working, you’re not alone. About one in five hires doesn’t work out, and research from SEEK (as reported by RNZ) suggests that’s costing SMEs across Australia and New Zealand nearly a billion dollars a year.
In New Zealand alone, SEEK estimates the annual cost of poor hiring decisions at around $911 million, with each wrong hire costing businesses an average of $20,000. You could make the case that the real figure is even higher, given the harder-to-measure impacts on team culture, employee engagement, customer relationships, and lost opportunities.“Most hiring managers know the feeling all too well. But the conversation usually stops at salary, but the real cost runs so much deeper than that,” says Rachael.
It’s not just about the salary
When a hire doesn’t work out, the financial hit is the easy part to see. You’ve paid someone who, for whatever reason, wasn’t the right fit.
“But that’s really only the surface,” says Rachael. “There’s a whole list of costs that rarely make it onto a spreadsheet.”
Things like:
- Lost productivity while the role sits vacant or gets managed around.
- The strain on your team, with colleagues quietly picking up the extra load and the stress that comes with it.
- The emotional and mental energy spent on difficult conversations and trying to find a way forward.
- Missed opportunities, as project deadlines slip, clients feel the gap, and momentum stalls.
And then, recruitment costs all over again: advertising, time, agency fees.
And underneath all of that sits something harder to measure but just as real: the effect a poor hire can have on team culture and morale.
“It’s also worth remembering that it’s not a great outcome for the person either. Going back into a tough job market, starting the search all over again, and sitting through more interviews and uncertainty is hard on people. Getting it right the first time is better for everyone involved.”
A CV tells you what someone has done, not who they are
A CV is, at best, a snapshot of the past. It can’t tell you how someone will show up in a new environment, how they’ll handle a tough week, or whether they’ll genuinely care about helping the business move forward.
“Ideally, candidates bring the technical skills the role requires. But what’s much harder to teach (and what my clients tell me matters most in the long run) is attitude, curiosity, and values. That’s what makes someone a good hire.”
When you’re assessing candidates, it’s worth pausing to ask alignment or motivational questions:
- Does this person see this role as a step forward in their career?
- Are they excited and aligned by what your business is trying to achieve?
- Are they adaptable and enthusiastic, not just technically qualified?
Someone who checks every box on paper but seems a little flat or disengaged can actually be a riskier hire than someone with a touch less experience but has the right drive and mindset.
“That’s not about writing anyone off. It’s simply about looking past the CV, and at the person, and if they have the real weight to drive, curiosity, and character alongside experience,” she says.
Be clear about expectations, from both sides
“One of the most avoidable causes of a wrong hire is simply a mismatch in of expectations, something that, with a bit of honesty early on, could so easily have been sorted out.”
- Is the role five days in the office?
- Is travel involved?
- What will the first 90 days really look like?
These aren’t tricky questions, but they’re often the ones that go unasked. And when someone starts a role only to find it’s quite different from what they understood, the relationship begins on shaky ground through no real fault of either side.
This goes both ways, too. Candidates deserve the same openness: being upfront about what they’re looking for, what they bring to the table, and what matters most to them. “In my experience, a good hiring process makes room for that kind of honest conversation, which makes it so much easier to find a really strong match rather than just filling a seat.”
Trust your instincts and give people room to show up
Interviews are nerve-racking, and it’s worth remembering that throughout the process. For many candidates, a lot is riding on this conversation, sometimes months of searching, uncertainty, and hope. A bit of nerves or a stumbled answer isn’t a red flag; it’s just being human.
That said, your instincts matter too. If something feels a little off (a disconnect between how someone talks about their experience and what’s on their CV, or a sense that the conversation isn’t quite landing) it’s okay to explore that further. This isn’t to catch anyone out, but because a good process gives both sides the chance to get to the truth of whether this is role is genuinely the right fit.
“What’s usually worth paying attention to, is patterns rather than moments, one awkward answer doesn’t tell you much. But consistent disengagement, or answers that feel rehearsed without much thinking behind them, can be worth probing into says Rachael.
Practical assessments have also become a valuable part of the process, and when it’s done well, it actually takes pressure off the interview itself.
“Whether it’s a small task, a short presentation, it gives candidates the chance to show what they can do in context, and is often where the real picture emerges, for the right person, it’s also an opportunity they’ll value.”
Getting hiring right is worth the investment
The SEEK data is a timely reminder that hiring decisions carry real weight – for the business, for the team, and for the candidate.
“The businesses that consistently get it right tend to be the ones willing to slow down just a little and do it properly: understanding the role, the team, the culture, and the candidate as a person, not just a list of skills on a CV,” concludes Rachael.
If your business is navigating hiring right now, or you’re simply looking to sharpen up your process, we’d love to hear from you. Get in touch with the Younity team. We partner with New Zealand businesses every day to help connect the right people with the right opportunities.
Based on a SEEK-commissioned survey of 955 small businesses across Australia and New Zealand. Estimates are self-reported and may vary by role and industry. Research conducted February 2026.
