Employee Referrals Make For Better Hires

Wondering if employee referrals make better hires than the typical screening process? Should you trust these people that your employees recommend? Yes, you should. In fact, employee referrals are where you're going to find better talent than blindly taking resumes from classified ads and job postings on various boards. The hiring process will be more efficient, and so will the introductory phase as the new hire finds their feet. You also tend to get better and longer-tenured employees. How so? Let's go over that. You may find that you prefer referral hires over traditional recruitment methods.

Hiring Process Is Faster And More Cost-Effective

We all know the adage that you have to spend money to make money, and this applies as much to new hires as it does to any other aspect of the business. Money, at least, in the form of time. Time has to spend going over potential candidates, recruiting, screening and interviewing. That time that hiring managers, department heads, and HR professionals spend in this process is taken away from their other duties. Some studies indicate that companies can spend upward of 40 days to hire a candidate from a company job posting, and possibly up to 60 from a job board or career site. However, JobVite reports referral hires often take 29 or fewer days. Employers also reported to JobVite that they often spent less money on the hiring process (usually the result of labor savings) but that isn't the only savings to be realized. You don't have to pay a professional recruiter or agency. You don't have to pay to place a classified ad or post open positions on a career site or otherwise advertise them. You get a person hired faster and for cheaper than through traditional methods.

Referral Hires Onboard Better And Tend To Be More Satisfied

One aspect of new hires is the onboarding process, and that is beyond merely training them and getting them acclimated to their job duties, standard operating procedures and so on. They also have to learn company culture and a host of intangibles before they are truly settled in and able to start producing for your company. This process can take months. Employee referral hires tend to get onboard far faster than people hired through traditional methods. Starting a new job in a whole new place with wholly new people is daunting. You have so much to learn; lingo and nomenclature unique to the workplace, procedures, people and personalities and so much more. It's a lot to take in. It's almost like moving to a whole new city, state or country though on a much smaller scale. What helps a person navigate the waters, so to speak? Having a friend that already knows everything. That helps any new hires get settled much more quickly. As a result, they also become productive much more quickly. Not only that, but referral hires tend to be more satisfied with their jobs. JobVite also found that 46 percent of referral hires stayed with their new employer for at least a year. Only 22 percent hired from job boards did so. People who assimilate quicker may also view their new place of work as more of a long-term opportunity. Naturally, they'll look for internal advancement and development opportunities instead of looking to leave for other employers...or worse, the competition.

You Can Truly Hire From Within And Develop Talent You Can Trust

With the turnover rate and longer development time inherent to making blind hires from job postings and career sites, employee referrals become more attractive. When you're looking to hire people for leadership positions, a lot of companies say - or at least like to say so for appearances' sake - that they prefer to "hire from within." Those hires from within that become talented, productive managers are more likely to come from employee referrals. Employee referral hires onboard quicker. They are retained longer. They are also more apt to buy into your corporate culture and view their employment as a longer-term opportunity as a result. You want someone who views your company as more than just a paycheck. You want the person who looks at their job as a mission, and their team as a family, which is far more likely to happen with a referral hire rather than a hire from a job posting or career site. Turnover rates are higher for those hires and tenures are typically shorter. Therefore, if hiring from within is a priority for your company, referral hires are more likely to be some of the chosen candidates.

Referral Hires Tend To Bring In More Referral Hires

If your company is a great place to work, your employees are going to recruit people that they think will be good hires and will succeed in that workplace. They are also likely to help that person that they've helped bring aboard to succeed however they can. Why are employees a better source of potential recruits? They are the people that do the work that makes your company successful. They are in the trenches, so to speak, every day, and are there with their other coworkers. Your employees know full-well what it takes to get the required work done and at that, done right. Therefore, they also know first-hand the consequences of making a bad hire, but also what it takes for a person to be successful in their workplace. Employee referrals tend to stick around longer and get acclimated quicker. That referral hires that are brought aboard if they like what they find, are likely to bring in more referral hires. Those referral hires will also bring in referral hires and so on. In other words, there's a snowball effect from employee referrals. Since employees are likely to bring in more quality hires, that means you'll have more success in your recruiting and hiring efforts, which in turn will benefit your business even further. You may not be able to afford to ignore employee referral programs from here on out.