Employee Referrals: Your Greatest Recruiting Source

You know that your employees are just as valuable as your customers, if not moreso.  Your team is the front-line of your business: executors of strategy, builders of customer relationships, and keepers of your employment brand.  The latter also means your employees are an amazing source for recruiting new talent.  

Think of your personal networks. From your social media reach to your personal and professional circles, when you share a job opportunity with your network it probably reaches hundreds of people. This same reach can be multiplied by empowering your employees to share job opportunities in their own networks.  Through a simple employee referral program you can quickly broadcast openings using your own internal recruiting force … all before spending a dime on job board postings!

Employee referrals are one of the largest sources of hires – 39% according to a recent study – for companies who actively communicate opportunities to their current employees and encourage referrals.  The impressive applicant-to-hire rate for referrals is largely due to the quality of candidates you’re likely to receive from a referral as opposed to a job board.  There is compelling evidence that shows A-Players refer fellow A-Players.  After all, talented, motivated people usually surround themselves with talented, motivated peers.  By empowering your high contributors to refer from within their network, you’re building a strong talent pipeline.

Here are a few more benefits to employee referrals:

  • Faster Time to Hire A recent study showed that it takes an average of 29 days to hire a referred candidate compared to  39 days to hire a candidate through a job site.  
  • Lower Cost per Hire – No recruiter fees.  No expensive sponsored job posts or advertising.  And due to the faster time to hire, you cut internal costs as well.  
  • Smoother Onboarding – A referred employee will usually have  more insight into the company and its culture when they start than  someone who applied through a job posting. And they have the  person who referred them as a resource to ease their transition!  
  • Higher Retention Rate – Referral employees stick around longer. As they have been pre-filtered by their referrer for cultural fit and performance, it’s no surprise that referrals have a lower turnover rate than other hires.  


Getting Started with an Employee Referral Program:

  1. Share Your Opportunities: Communicate open positions to your employees and get them excited to share with their network.
  2. Track Referral Applicants: Use unique job posting URLs and referral form fields so that you can track sources and provide invaluable insight into your hiring process.
  3. Keep Referers Informed: Your employees are doing you a favor by sending talent; replay them by communicating openly as their referral moves through the hiring process.  
  4. Reward Referral Hires: Motivate employees to consistently refer great candidates by providing a referral bonus when you hire their referral.   

At CareerPlug, we made it easy for our clients to take advantage of employee referrals by integrating employee referral communication and tracking into our hiring software.

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Originally from small town in central Texas, Ashley Johnson graduated from Texas State University in 2013 with a degree in Business Administration. She was hired by CareerPlug as a Talent Specialist in 2014, and moved up to ultimately lead the Recruitment Services team. From there, she pivoted to Implementation, and is now the Implementation Manager.

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