At the end:

  To employers – ask your staff to help find new hires.  Offer a bounty – enough to get their attention, say a fortnight’s     salary.  It’s a lot less than Shithead would cost.  And their incentives are all positive: no-one will hire an idiot if they have to   work alongside them and new staff with social ties to your team are far more likely to stay.  You’ll be amazed how effective   this can be.

There are limits to this, and having someone from your team refer someone they know does not guarantee they will be an excellent worker, but I would tend to agreed that the overall quality of your team will be much higher this way.