Employee referrals are much more important, but still remain a (relatively) low priority for human resources departments.
Recruitment through human resources departments have traditionally been from a variety of sources used to find skilled candidates. Most of the time recruiters would consider potential employees in a pool of possible applicants through career sites and job boards.
Employee referrals are the becoming the best way to get the most qualified applicants. As it has always been the case, it is about who you know. Your employees may be holding the key to the perfect candidates.
In a recent survey, referrals may provide more hires, sometimes considerably more, what was once thought to be the case.
It has become accepted wisdom to estimate the average number of new hires coming from employee referral programs lies between 25 percent (at least for non-exempt positions) to around one-third. Some programs have performed better than others.
Last year, in a survey of clients and others, CareerXroads staff discovered that in the companies that have a referral program, the standard for external hires from referrals averaged much higher, at 28 percent. Most of those companies pay a bonus of some sort for new referrals.
They also learned that it takes an average of about 10.4 referrals for one hire. Some companies are either so particular or acquire such a large number of referrals that only one in 25 referrals (sometimes even more) will result in a hire.
There were some surprises. Unfortunately, few employers actually devote staff to promoting an employee referral program, leaving it largely under the umbrella of Human Resources departments. Often, they are understaffed, and a profitable source for quality candidates remains untended.
This is disturbing because the amount of effort one could invest in a referral program could easily save energy in recruitment and hiring from other sources.
One intriguing infographic is from Jobvite, showing how referred candidates offer several advantages to employers over those who come up through “outside” sources.
Infographic after the jump…