Industries with the most misconduct
Industries with the highest levels of misconduct were media and entertainment.
A rule of thumb says that if 5% of a workforce engages in misconduct, it can hurt the company’s ability to attract and retain talent, maintain a positive brand reputation, remain compliant and avoid costly legal fees. Seven of 9 industries studied failed this 5% rule, according to the Fama State of Misconduct in 2022 Benchmarking Report.
“Having built a business on supporting other businesses by helping them hire great people, we know the ultimate cost companies spend navigating workplace misconduct,” said Ben Mones, CEO and founder of Fama. “Our goal in issuing this report is to share our insights on the prevalence of candidate misconduct, along with advice on how to avoid it.”
On average, the percentage of screened candidates participating in misconduct is more than double the acceptable standard, the report said. With the staggering costs of misconduct topping trillions of dollars per year for businesses, this research is aimed at helping companies, particularly those in failing industries, get a better understanding of the types of misconduct affecting them and what can be done to improve it.
The report analyzed eight types of misconduct and found that overall, the most common issues were harassment (37%), sexual misconduct (24%) and intolerance (19%). The 11% of candidates with misconduct appear to be habitual abusers, with an average of 10 instances of misconduct.
Industries with the most misconduct:
- Media & Entertainment — 27%
- Consumer services — 27%
- Education — 21%
- Technology — 21%
- Business services — 9%
- Financial services — 9%
- Manufacturing — 7%
- Government & non-profits — 5%
- Health, pharma, biotech — 4%
Only health care, non-profits and government industries passed the 5% test. Media and entertainment saw the highest levels of misconduct of any industry, and more than a quarter of candidates screened in that category last year showed signs of misconduct.
The research shows the positive impact of additional candidate screening, because the two industries that met the 5% threshold both have higher screening standards.
Related: Economic uncertainty and employee misconduct go hand-in-hand
“Now more than ever, cultivating a supportive and healthy work environment is critical for retaining talent but also for developing successful, scalable businesses, which is why comprehensive screening ahead of hiring should be commonplace to avoid costly misconduct issues,” Mones said. “In fact, Harvard Business School finds that when a company avoids the hiring of or terminates a toxic employee, organizations experience twice the value to the company than hiring a superstar performer.”