When you embark on finding new talent for your company, you need to take into account that this can turn into an expensive process. If you add up the costs of advertising on job boards, paying in-house recruiters as well as retained or contingency recruiting firms, creating material to brand your company as a great place to work, attending recruiting events, paying for subscriptions to employee referral software solutions, background check services, video interviewing tools… the bill adds up. However, there are some cost effective recruitment strategies you can start taking today, to try and lower that bottom line.
Cost effective recruiting with referrals
This method is the most inexpensive way to find new talent and is proven to work. People tend to make friends with others who share their interests and skill sets. This means that you can trust employee referrals to be of high-quality. In addition, those candidates will have prior knowledge about your company from your employee, so they will arrive at the role with realistic expectations.
And finally, since the referred candidate has a contact inside your company, they will be more likely to want to impress, as well remain longer in the position, as they don’t want to reflect badly on their friend. You can also offer a reward scheme for bringing in new recruits, to increase referrals.
Increasing direct hires
Amongst the cost effective recruitment strategies, one of the best is direct hires, meaning, having candidates contact you directly, and not through an ad. This will require a lot of legwork, but it will be worth it in the long-run. Start with creating a good careers section on your website, which is always up-to-date, and reflects the company’s values.
The next step will be to create opportunities for potential employees to learn about your company. A great way to do that is by creating workshops, competitions and internship schemes with your local universities and other higher education institutions. Whenever your employees go to conferences or retreats, make sure they network, and get the information of the most interesting people they met. Another great resource is your past employees. Make sure you keep in touch with them with an alumni mailing list, to advertise new roles, and get referrals from them as well.
Cost effective recruiting via online advertising
Let’s face it, most people consume their information online today, so it might be the best place for you to advertise for your role. If you’re looking at the bigger, more established job boards, those will, unfortunately, set your budget back. But there are plenty of cost effective recruitment strategies available online as well. For one, there are many smaller job boards that offer listings for free, as they wish to boost their rankings. If you post your ad in enough places, a search engine may pick it up as well.
Social media is, of course, another great option, with the best channels being LinkedIn, Twitter, Facebook, and even Reddit (don’t forget about the groups). The key is consistency with posting, making sure that you are present to create a conversation as well. We’ve already mentioned listing the roles on your company website, but making sure you use the right keywords will also make them appear higher in search engines. And finally, try listing the role in specialized industry guilds, trade associations and anywhere specific to your company’s field.
Cost of outsourced recruitment
In some situations, you may prefer hiring a recruiting firm for roles that are more specific and harder to fill. But the cost of outsourced recruitment is not fixed, and can also be reduced if you negotiate the recruiting process with them. For one, if you assign a recruiting firm with a role that they know they have a high chance of filling, they will be willing to reduce their fee accordingly. Another thing to consider is exclusivity. While contingency recruiting firms have a standard fee of 25% of an annual salary, they may be willing to cut it to as low as 15%, to receive exclusivity.
Another way to reduce the fee is to agree to pay a portion upfront. For example, you’ll pay 4-5% of the employee’s salary when you hire a recruiter, and when the placement is final, add 4-7%. The total fee will be much lower than the regular fee, as the recruiter will be more than happy with being paid upfront. Finally, another way to save on the cost of outsourced recruitment is to agree on an hourly rate.
A contingency recruiter’s success rate is usually one placement in 5-10 job orders, as they are competing with other firms and the clients themselves. This means that they have to charge more, in order to make their work worthwhile. But if a recruiter knows they are being paid no matter what, they will be willing to accept a lower fee. Just make sure that you make this agreement with someone you trust to be good at their job.