Technology is constantly evolving and helping people in many industries do their jobs faster and better. These technological advances also have an impact on how people are hired.
Recruiting is one of the costliest operating costs of any business and the goal of any employer is to find ways to reduce recruiting expenses while maintaining the quality of those hired. A good place to start is to determine how much your current recruiting approach is costing your organization, then find areas that can be eliminated or reduced. When it comes to hiring the right people on a tight budget, I’ve had my share of hurdles, but having the right methods in place makes things so much easier.
I came across a 2019 study by US Yello Recruiting where a majority of recruiters reported an average cost per hire of $3,000 or less for all open positions. However, 31% of companies admit to spending more than that, and 5% reported a cost per hire of more than $6,000 per role. Surprisingly, 17% of respondents said they had no idea or didn’t follow the cost of hiring statistics at all.
Finding the right match in a timely manner is key – your bottom line depends on it. Luckily, there are ways to minimize your cost and time to hire. Here are some of the most effective techniques for reducing recruitment costs without sacrificing talent quality:
1. Reduce your need to hire in the first place: It’s no secret that it costs less to retain than to attract talent, but I’ve noticed that a lot of companies don’t seem to understand this fact. According to research, employee retention statistics for 2018 show that the turnover rate was 27%, while the average turnover rate in 2019 was 36%. Since 2010, the turnover rate has increased by 88%. Reducing turnover by developing employee retention strategies will save you a lot of money – so you’ll have less need to hire replacements for departing staff. It’s also a bad image for a company to post job offers month after month for the same positions, it can scare away quality talent.
By asking managers to schedule frequent goal reviews with their subordinates, you can stay informed of people who want to make lateral or vertical moves within the organization. Tracking employee aspirations will allow you to make the most of the talent you currently have on your team and foster a culture where employees feel valued and heard, which is key to reducing turnover rates.
2. Develop a referral system – Referrals are a company’s biggest source of income – this also applies to recruiting. Some of the best talent is recruited through referrals – which is why I always check with employees to see if they have someone in their network who would be a perfect fit for a vacancy. I also take the time to encourage employees to share job postings and even offer incentives to boost enthusiasm and speed up the process. This is easily the best way to reduce recruitment costs without compromising on quality.
3. Encourage employee advocacy – Word of mouth is one of the most effective forms of marketing – I often scan online reviews before buying a good or service or friends recommend a business before I even think of patronizing. This also goes for recruitment, some companies with the best talent today don’t even have to spend so much money to attract talent, they already have the “weight” to do the work for them.
Employee representation is a fantastic tool for attracting people who are genuinely interested in working with you. At Fuzu, we strive to hire “ambassadors” rather than employees, and we do this by fostering a healthy work environment, a great work culture, and an organization that everyone would be happy to work for.
4. Take advantage of social media – Clients who hire through Fuzu have the option of posting their roles on Fuzu’s social media channels, which have a total follower count of xxx. This allows us to broaden our reach and showcase our clients’ corporate culture and encourage candidates to apply. This is particularly beneficial for clients looking to appeal to a younger audience, as they can apply immediately from their phone.
5. Leverage AI to gain efficiency – Recruitment is a tedious task that needs to be right from start to finish in order to get the right results – from crafting a suitable job description to selecting the right marketing channels, recruiters really have their work cut out on Plate. Why not adopt a data-driven approach for your recruitment?
Our clients on Fuzu use talent screening systems that compare candidate skills and experience against requirements, then provide lists of top candidates in real time. This method automates the first stage of screening, allowing HR managers to focus their resources on the right candidates. Investing in the right technology will ultimately pay off in terms of time, efficiency savings, and achieving your overall business goals through recruiting high-quality talent.
If you think hiring quality professionals is expensive, wait until you hire the wrong person; the repercussions will affect not only your business, but also you as a person, setting you back many milestones, compared to your planned ambitions. A bad hire can cost your business time, money and customers. It is likely that not all of the approaches listed above will work for you. So be sure to use a combination of these approaches and tools to help you recruit effectively.
Patricia Duru is the Country Manager of Fuzu Nigeria