It’s a scenario that’s all too familiar for mining companies across Australia: a critical role goes vacant, recruitment takes longer than expected, and when the role is finally filled, the new hire is not a good fit. The operational and financial fallout from such a misstep can be staggering—costing companies as much as $2 million.
The true cost of a bad hire isn’t limited to the obvious expenses like recruitment fees or onboarding. It’s a cascade of inefficiencies, lost productivity, and often, reputational damage. For an industry like mining, where operational efficiency hinges on having the right people in the right roles, the stakes are even higher.
The ripple effect of a vacant role
In mining, the ripple effect of a vacant role can be particularly severe. Take, for example, the role of a mining manager. This individual doesn’t just oversee day-to-day operations, they are responsible for safety, manage teams, coordinate resources, and drive efficiency in what can be a high-stakes environment.
When this position remains vacant, the impact is felt across multiple areas. The team may face leadership gaps, which results in confusion, lowered morale, and potentially unsafe work practices. Operational delays can occur, and projects may stall as tasks pile up without proper oversight.
Additionally, the longer the role stays vacant, the greater the pressure on existing managers and staff, who are stretched thin, often taking on responsibilities outside their core duties. This not only risks their performance but can also negatively affect production, and ultimately, the financial performance of the business.
In such critical roles, the longer a vacancy persists, the greater the impact on the entire operation.
“A mining company might see a position stay vacant for three to six months,” explains recruitment expert Justin Campbell, Head of Projects at Globe 24-7. “Not only is the vacancy itself costly, but the onboarding process for the eventual hire takes additional time. It can be months before they’re fully productive.”
For a reliability engineer role, the annual cost of vacancy—including operational losses, delays, and additional burdens on existing staff—can easily top $1–2 million.
Let’s look at those costs in more detail:
| Category | Specific Cost | Calculation Basis | Estimated Amount ($) |
|---|---|---|---|
| Recruitment Costs | Job Board posting | $200/posting | $600 |
| Onboarding Costs | Safety training, inductions, medicals, PPE uniforms | Flat rate | $15,000 |
| Hiring Manager Productivity | Productivity/time loss: interviews, shortlisting, briefing | $120/hour, 5 days work | $6,000 |
| Recruitment Team Cost | Internal team hours to recruit one role | $80/hour | $5,000 |
| Operational Impacts | Underperformance by the hire | $200k per quarter minimum | Likely millions per quarter |
| Disruption to team because of covering for vacant role | 10 hours/week @ $120/hour per person (team of 4) | $5,000 per week | |
| Contract penalties | Flat fee | $25,000 | |
| Flat fee for investigations | Flat fee | $5,000 | |
| Repair costs | Flat fee | $3,500 | |
| Loss of engagement | 20% reduction in team output | $200–500k+ | |
| Increased team turnover | Recruitment costs for peers | Based on recruitment numbers | |
| Loss of morale & burnout | Increased sick leave and mental health costs (e.g., one extra week) | $5,000 per week |
The true cost of bad hires
The financial toll doesn’t end once someone is hired. A poor recruitment process often leads to the wrong person being placed in the role. This triggers a 4-step domino effect:
- Underperformance: A bad hire impacts team efficiency, forces managers to spend excessive time on performance management, and delays projects.
- Attrition: If the hire is managed out or quits, the position becomes vacant again, restarting the costly recruitment process.
- Recruitment costs: Each rehiring effort adds agency fees (averaging $30,000 per placement), advertising costs, and valuable time spent screening and interviewing candidates.
- Operational disruption: Leadership teams pulled into recruitment activities spend less time on strategic priorities, further impacting the business’s bottom line.
Hidden costs: Employer brand and culture
High turnover doesn’t just strain finances, it also damages a company’s reputation. In a tight labour market like mining, word travels fast. A reputation for frequent turnover or poorly managed recruitment processes can deter top talent from applying.
“When potential candidates see high turnover rates, they wonder if it’s worth the risk to join,” says Campbell. “That makes future recruitment harder and more expensive, perpetuating a cycle of bad hires and costly vacancies.”
The core issue often lies in the recruitment process itself. In-house teams, particularly those unfamiliar with the complexities of mining roles, may struggle to deliver high-quality candidates quickly.
“A rushed or poorly briefed recruitment process can lead to misalignment between what hiring managers need and what recruiters are searching for,” Campbell explains. “In mining, understanding rosters, remote locations, and the physical demands of a role is critical. Without that knowledge, recruiters can’t screen effectively, and managers end up choosing from the ‘best of a bad bunch.’”
Outsourcing recruitment to a professional recruitment process outsourcing (RPO) provider can address these challenges. By setting clear service level agreements (SLAs) and key performance indicators (KPIs)—such as filling roles within 70 days—an RPO ensures a faster, more efficient hiring process.
Retention: The key to cost control
A strong recruitment process doesn’t just fill roles quickly, it ensures the right candidates are placed and retained. This is where external recruiters with deep industry expertise can add significant value.
“Retention starts with quality hires,” says Campbell. “If the candidate is well-suited to the role and organisation, they’re far more likely to stay. That reduces turnover, saves on rehiring costs, and boosts operational stability.”
The argument against investing in professional recruitment often revolves around cost, but the numbers tell a different story. A bad hire can cost a mining company up to $2 million, factoring in vacancy-related losses, rehiring expenses, and the indirect toll on employer brand and team morale.
The solution lies in prioritising speed and quality in recruitment—whether by refining internal processes or partnering with an external provider. After all, in the high-stakes world of mining, a single bad hire can have a goldmine-sized impact on the bottom line.
