Referrals Remain Preferred Source for Finding Top Talent
May 9, 2016 – Seventy-one percent of HR professionals say employee referrals are the best resource for finding candidates, yet only seven percent of job seekers surveyed view referrals as their top resource for finding a job, according to new survey by workplace research firm Future Workplace and career network Beyond.
The ‘Active Job Seeker Dilemma’ survey found that job seekers who are ‘passive’ with a wide network of referrals have the advantage over job seekers who are ‘active.’
Not surprisingly, when it comes to the job search, passive job seekers, or those who are employed but open to new opportunities, have a better chance of being hired over active job seekers, or those who are unemployed and searching for work.
Employers value passive job seekers and according to the survey, 80 percent of HR professionals believe they become the most effective employees. HR professionals also say the benefits of hiring a passive job seeker over an active one include: they have more experience (44 percent), they possess valuable skills (44 percent) and they take their careers seriously (42 percent). However, many job seekers are unaware of this advantage. When asked about who has a better edge in the job market, less than half (47 percent) of job seekers said passive job seekers.
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“I always urge individuals to become passive job seekers so they can gain leverage and power over their career prospects,” said Mr. Dan Schawbel, partner and research director at Future Workplace. “If you’re unemployed, you can turn into a passive job seeker right now by freelancing, selling items on sites like Amazon and eBay, being an entrepreneur, volunteering or blogging. By engaging in these activities while you search for a job, you won’t have gaps on your resume, you’ll be practicing new skills and potentially make side income so you will be less desperate for a job, which makes you more attractive as a job seeker.”
In addition to the active job seeker disconnect, the survey revealed the sentiment of HR professionals and job seekers in various areas. Here are some additional highlights from the report:
- Your college major dictates your career prospects. Fourteen percent of job seekers surveyed were liberal arts majors, yet only two percent of companies are actively recruiting those majors. Fifteen percent of job seekers were engineering and computer information systems majors, yet 30 percent of companies are actively recruiting those majors. About a third of job seekers would, or have, changed their college major to have better job prospects.
- Cultural fit matters but GPA doesn’t when it comes to hiring. While job seekers (23 percent) and employers (24 percent) agree that internship experience carries the most weight for students when seeking jobs, employers don’t view GPA as carrying a lot of weight (six percent) as much as job seekers do (12 percent). Companies put more emphasis on cultural fit (24 percent) than job seekers do (15 percent) when recruiting.
- Beyond communication skills, employers and employees differ on skill alignment. Effective communication skills are at the top of the skills list for both employers and employees. After communication skills, employers look for employees with the ability to adapt to change and make sense of ambiguity, followed by being results driven and goal-oriented as their most desired skills. After communication skills, employees report leadership ability, in-person collaboration and teamwork skills as their subsequent strengths.
- Job seekers and employers alike may not be fully anticipating the new skills required to operate in more networked organizations. The top three weaknesses reported by employees were virtual collaboration and teamwork skills (48 percent), technical skills (46 percent), and being culturally aware and inclusive (43 percent). HR professionals reported virtual collaboration and teamwork skills (43 percent), and being culturally aware and inclusive (also 43 percent) as the second and third least important skills when hiring.
- Bonuses and promotions are most important to job seekers. While bonuses (80 percent) and promotions (70 percent) are most important to job seekers when it comes to rewards and recognition, top of the list for companies on rewarding and recognizing employees was recognition in front of their peers (68 percent), ahead of bonuses (63 percent) and promotions (59 percent).
- It’s easier to find a job somewhere else than within. Job seekers are optimistic about the job market and may perceive it as easier to seek a new job outside the company than to secure a lateral move inside the company. More than 40 percent of job seekers reported that it was difficult or very difficult to make a lateral move at their most recent organization, while less then one quarter of respondents reported being not optimistic about the broader job market.
- Companies need to rethink how they can help employees advance their career. Only 50 percent of job seekers say that their most recent employer has helped them advance in their career. Employers are focused on promotions (68 percent) and project assignments (47 percent) as how they believe they are helping advance careers. Job seekers reported that employers could best help advance their careers through project assignments (48 percent), promotions (39 percent) and leadership development programs (35 percent). Employers may be recognizing this need because 56 percent of HR professionals say they will seek to enhance their employee experience in 2016 by investing more in employee training and development.
- Gone are the days where people want to work for big companies. Sixty-five percent of all job seekers want to work at small to medium sized companies with fewer than 1,000 employees, indicating a preference for a more manageable scale of employer or division. Fifty-eight percent of Millennials want to work for a small or medium sized company compared to 63 percent of Gen X and 71 percent of Baby Boomers. Only 13 percent want to work at very large or global companies with 10,000 or more employees.
“A strong application coupled with quality referrals will provide job seekers with an advantage in the hiring process,” said Mr. Schawbel. “You should constantly be exploring new ways to nurture and expand your referral network, and it may be easier than you think. For example, attend industry conferences and events, grab lunch with a former colleague or make new connections on social platforms – a few simple actions may help you land your dream job.”
Despite new forms of technology, social media and other new online tools created for hiring, good old fashion referrals seems to have the most impact.
More than 50 percent of referred employees have been in their current position for more than five years, supporting various findings that have cited employee referrals as a top source of hiring, according to ‘The Impact of Successful Employee Referral Programs,’ issued by iCIMS. The study found that employee referrals are the most significant source-of-hire for employers, bringing in top talent that increases quality-of-hire, instances of cultural fit, positive results, and decreases key metrics such as cost-per-hire, time-to-fill, and turnover.
“(A great referral program) allows you to turn your entire workforce into recruiters,” said Kara Yarnot, founder of Meritage Talent Solutions. “When you only have so many recruiters and so many resources to reach out to candidates, it helps to have a great referral program to empower all of your employees to help in sourcing.”
Technology to support recruitment and tracking for referred candidates was cited as one of the biggest opportunities for improvement in iCIMS’ study. Characteristics for a successful programs include creating a quick and simple internal referral process and timely recruitment communication with referrals.
One startup that is helping companies fill job openings through crowdsourcing and monetary incentives – the latest twist that takes employee referrals to an entirely new level – is ReferralMob. Launched last June, the mobile and Web app company has $500,000 in cash rewards in its coffers to help recruit employees at Massachusetts-based companies.
“We are Uberizing the recruiting industry,” said chief executive David Samuels. “We are expanding the number of paid referrers for a job beyond companies and agencies to tens of thousands of interconnected influencers. Because we are democratizing the referrals of these candidates, our customers can also expect more diversity among qualified applicants.”
While referrals have always been popular for hiring top talent, social media is gaining ground as the go to source for finding new employees.
Approximately 3.3 million job applications were submitted using social media profiles to pre-populate online submission forms, according to latest iCIMS ‘Job Seekers Get Social’ report, which analyzes the role of social networks such as LinkedIn, Google+ and Facebook in the job application process. Of the 3.3 million applications that were submitted via a social profile, 61 percent used LinkedIn, 22 percent used Google+ and 17 percent used Facebook.
From the employer perspective, social media is also a key tool for hiring with 84 percent of organizations using it currently and nine percent planning to use it, according to a report recently released by the Society for Human Resource Management (SHRM). In 2011, only 56 percent used social media for recruitment. For many organizations (81 percent) today, it has become one of many tools used: five percent said it was their primary recruiting tool. This metric is expected to jump considerably in the next few years.
Numerous other reports have surfaced showing the increasing role social media is having on recruiting. Another recent SHRM survey, ‘The Importance of Social Media for Recruiters and Job Seekers,’ found that nearly two-thirds of companies (65 percent) found new hires through social media in the past year.
The study revealed that 57 percent of organizations found new employees through LinkedIn, 30 percent through professional or association network sites, and 19 percent through Facebook. Overall, 87 percent of HR professionals said it was either very or somewhat important for job seekers to be on LinkedIn.
“Social media is another way recruiters verify applicants’ employment history and ensure that they are still viable applicants,” said Evren Esen, director of survey programs at SHRM. “Social media is here to stay, so employers and employees are utilizing it in various ways throughout the job search process.”
Contributed by Scott A. Scanlon, Editor-in-Chief, Hunt Scanlon Media
