Why is referral good for me?
Thu Aug 08 2019 10:00:00 GMT+0000 (Coordinated Universal Time)
What is the solution for all stakeholders to be better off? Referral is the answer but Why?
Recruiting is never easy. HR professionals spend day and night promoting open positions, screening applications, and vetting potential candidates. Candidates send their CV to a sea of firms, going through tedious processes but only a few can succeed. So, are there a way to lessen their burden?
Here is the solution for all stakeholders to be better off -- Referral.
An Employee Referral Program allows current employees to refer friends, family, and other associates for open positions within the company. Many recruiters and other HR professionals say that referrals are their best employees. On the other side, an applicant with referral is 8 times more likely to be hired than a normal applicant. Therefore, if you are wondering why should you use an Employee Referral Program or why you should find someone to refer you, you should keep reading till the end. The benefits of referral are numerous and the beneficiaries include the referrer, applicant and employers.
Benefits for employer/ company:
1. Save time and effort to hire
Saving time through more efficient recruitment processes is the most prominent benefit of referral to a company. According to research from Glassdoor, hiring times have been steadily increased over the last few years, and job interview processes in the United States now take an average of 23 days. Referral is a trusted methodology in recruitment. Therefore, hiring referred candidates can speed up the processes by fastening screening steps and reduced redundant applications. This saves the time and effort for the on-boarding of new hires.
2. Cut recruiting & training costs
Referral allows the employees to do a lot of the recruitment work for the company. If the employees enjoy their jobs, they will promote open positions to friends and family. Referral cuts back on traditional job advertisements such as posting on different job boards and/or finding headhunter. In addition, they can save cost in training the new hires. As the referrer would share their personal experience about what it is like working in the company, the referred will be more informed.
3. Increase employee retention
According to a report on social recruiting, the best talent often comes from internal hires or employee referrals. Additionally, a study indicates that referred employees tend to stay with a company longer. More than half (56%) of them said that they’ve been in their current role for more than five years. It is because they have an established network before they step in, and they have less expectation gap with their referrer’s advice. Hiring employees who start out with a good understanding of the company and an in-house advocate is a useful strategy for reducing turnover.
Benefits for referrer:
1. Referral bonus
The reward for referral is attractive to the referrers in terms of financial boost. Companies offer a promising number to incentivize their employees to promote the job. Bringing in talents is equivalent to creating value to the company.
2. Improve well-being
Other than that, referring a person they know well makes them more comfortable at work. This boost their well-being. Moreover, current employees feel trusted and valued since they are participating in the company’s future and growth. If their referral gets the job, they feel a sense of pride and accomplishment.
Benefits for referred employees:
1. Easier to integrate
Referred employees feel more engaged from day one since they already have the connection and basic understanding of the company. Often, they are easier to fit in the environment and adopt to the culture since they have a built-in buddy or mentor for guidance. They will know some insider information, organization structure, dos and don’ts before they start their journey.
2. Higher chance to get hired
Remember at the beginning of the passage, we mentioned that an applicant with referral is 8 times more likely to be hired? Sometimes we just have to admit that having a reliable referrer do help you to escalate your career. Especially when the referrer is in the senior management level, you are at an absolute advantage. Not only is this a nearly effortless mean to get a new job, but also comes with the higher bargaining power to negotiate for a better salary package or promotion. This remind us that building our network and enlarging social circle is always important for career development.
Interested in exploring career opportunities or know a friend who does? Let us know!