What a Bad Executive Hire Costs and How Recruiters Help

A company is only as good as the people running its projects. In construction that is literal: a superintendent, a project executive, or a preconstruction director sets the schedule, the safety culture, and the client relationship for every job they touch. When one of those hires goes wrong, you see it in the numbers and on the site.

This post covers what a bad senior hire costs, why they happen in construction in particular, and where an executive search firm fits.

How common are bad hires?

Common enough that most employers have made one. A 2017 CareerBuilder and Harris Poll survey of 2,257 hiring managers and HR professionals found that 74% had hired the wrong person for a position. Respondents put the average cost of one bad hire at $14,900 over the previous year (HR Dive, 2017).

The survey covers employers across industries and job levels, so $14,900 is a low reference point for a failed project executive at a contractor. The more senior the role, the larger the direct and indirect costs.

When employers in that survey described what went wrong, they most often cited negative attitude (53 percent), not working well with others (50 percent), absenteeism right after hiring (46 percent), and lacking abilities the person claimed to have (45 percent). Notice that three of the four are about behavior and fit, which a resume rarely shows.

What the cost is made of

For a senior hire, the bill has several parts.

Direct costs

• Recruiting fees, advertising, and interview travel.
• Relocation and sign-on payments that cannot be recovered.
• Salary and benefits paid while the person is not delivering.
• Severance, if the person is let go.
• The cost of finding a replacement and doing it all again.

Productivity and project costs

• Time from managers and executives spent on coaching, rework, and repair.
• Schedule slippage and change-order exposure when a project leader misses early warnings.
• Quality and safety issues if the hire does not fit your standards.
• A longer vacancy when the search restarts.

People costs

• Teammates who pick up the slack and burn out.
• Subcontractors and owners who lose confidence in the team.
• Good employees who leave because they are tired of working around the problem.

The hiring market makes the direct figures worse. SHRM reports that cost per hire for executive positions has risen 113% since 2017, while cost per hire for nonexecutive positions fell 27% over the same period (SHRM, 2025). Every restarted search costs more than the one before it.

A way to size it for your own firm

Use your own numbers. For a specific role, add up:

1. The first-year salary and benefits you would pay a person in that seat.
2. The fees and relocation you would spend to hire them.
3. The weeks the seat would be vacant or underperforming, multiplied by the weekly cost of the work that does not get done.
4. The management time to coach and then replace them.

For reference, BLS reports a median annual wage of $114,990 for construction managers in May 2025 (BLS). That is a median across the occupation, so substitute your own figure for the seat in question. The arithmetic is simple, and doing it once for a real open role usually changes how much time the firm is willing to spend getting the hire right.

Why bad hires happen in construction

The reasons are mostly structural.

Urgency. A project starts, a key person resigns, or a bid is won, and the seat needs to be filled now. Under pressure, hiring managers skip reference calls, skip credential checks, and settle for the first strong interview. In AGC and NCCER's 2025 survey, 48% of firms said new hires failing to show up or quitting soon after starting was a reason filling positions was hard (AGC and NCCER, 2025).

Divided attention. The person doing the hiring is usually also running projects. Interviews get squeezed between site visits and bid deadlines.

Interviewing is a separate skill. A great operations executive is not automatically good at assessing candidates. Without structured questions and reference checks, interviews reward people who present well.

A thin market. In AGC and NCCER's 2026 survey, half of respondents said available candidates lack the skills, certificates or licenses they need, and the 2025 survey found that 81% of firms looking for superintendents called those roles hard to fill. ABC estimates the industry needs to attract about 349,000 net new workers in 2026, and its chief economist said a majority of that new demand comes from retirements (ABC, January 2026). When good people are scarce and the job needs to be filled, firms lower the bar without noticing.

Posting and waiting. The strongest candidates for a senior role often have a job. They are not reading postings. A search that relies only on applications sees a different group of people than one that approaches them directly.

Where a search firm fits

A firm does not replace your judgment. It supplies time, reach, and a structured process at the point where your own time is tight.

Reach. A recruiter who works in your industry every day knows who is employed, who is open to a call, and who has the project history your role needs. That gets you candidates you would not see from a posting.

Time. Sourcing, screening, scheduling, and following up all take hours. A firm does them while you run your jobs.

Screening. A good recruiter checks the claims on a resume, asks the same questions of every candidate, and looks for gaps in credentials, tenure, and scope before you spend an hour with someone.

Candor. A recruiter who has placed people in your market can tell you your compensation is below the range, or that two requirements rarely appear in the same person. That helps you adjust the search early.

Fit and retention. A firm that learns your culture, your leadership style, and where the role fits in the next three years can screen for those as well as skills. Ask any firm you hire how it checks for longevity and what it does if a placement does not last. Our post on how to choose a search firm covers the questions to ask, and what to expect when you hire one walks through the process.

A firm is not always the right answer. If you already know the person you want, or the role is junior, hiring directly may be faster. For senior roles, confidential replacements, hard-to-find specialties, or a vacancy that is hurting active projects, outside help usually pays for itself.

Steps that lower the risk, with or without a firm

• Write down what the person must accomplish in the first twelve months before you start looking.
• Use the same structured questions with every candidate. If you need ideas, see how to screen out unqualified applicants.
• Check references with former supervisors, and verify licenses and credentials at the source.
• Include at least one person who will work with the hire in the final interview.
• Set a thirty, sixty, and ninety-day check-in and write down the expectations in the offer process, so problems surface early.
• Do not shorten the process because the vacancy hurts. The vacancy is cheaper than the wrong hire.

Next step

The S.R. Clarke Group has recruited for construction and infrastructure employers since 1979. If you have a senior seat to fill, start at our employers page or contact us.