An employee referral program remains one of the best ways for companies to find new talent. An employee referral program works on the premise of offering incentives to your current employees for referring successful hires.
Using this method will streamline the entire recruitment process by helping you to find better quality candidates with less effort.
Here are six of the main reasons why an employee referral program is an excellent idea for any kind of company.
1. Helps Find High-Quality Candidates
Successful employee referral programs help companies to attract more candidates. This is one of the biggest advantages of using a referral program.
Employee referral programs will help you spread awareness. This is instead of relying only on the typical channels your companies normally use to find job candidates.
An employee referral program encourages your existing employees to advertise the open position to their networks. As well as posting on job boards.
Employee referrals make it easier to reach larger pools of job seekers. This results in more high-caliber candidates applying for the job.
And with more high-quality candidates, the entire hiring process becomes far more efficient. This is because your company employees are already in contact with qualified candidates in the same circles.
These employees also have an incentive to recommend candidates that will get the job, so they will only refer candidates who they think will impress.
2. Lowers the Cost Per Hire
Even though you offer an employee referral bonus, companies that take this route can decrease their cost per hire significantly.
The traditional ways of finding employees that most organizations use can be incredibly time-consuming. In most cases, employers end up sifting through many unqualified or badly matched candidates. And spend a lot of money advertising the position in different places.
By using an employee referral program, HR professionals can find more relevant employees faster and with less effort. This can make a big difference to the overall cost per hire.
3. Saves Time
Using employee referrals creates immense efficiencies and helps lessen the amount of time spent on recruitment. This is because hiring teams can cut out some of the normal steps involved in the recruitment process. (This can include the analysis of applications and resumes).
4. Improves Employee Engagement
Employee referral programs don’t only help hiring managers to achieve their hiring goals more easily, but they also improve the company culture.
A referral program provides a reason for employees to get more engaged and involved in the company. Looking for employee referrals also makes existing employees feel more valued.
By providing referral incentives, it shows that you trust and care about your employees. This is a great way to motivate employees and get them more actively involved in your organization.
5. Improves Employee Retention Rates
A referred candidate has a greater chance of sticking it out with your company for longer compared to traditional hiring processes.
This is because current employees will only recommend candidates if they truly think they are a good fit. And if the referred candidates are a great fit, then they will most likely work for the company for much longer.
6. Helps Find a Better Company Culture Fit
Without employee referrals, hiring candidates can be a real hit or miss. Even with an extensive interview stage, you can still never be too sure of who you’re hiring until they start working.
Filling open roles is not only about work experience or educational background. It’s about the entire personality and outlook of the job candidate. Recruiters don’t just want to find someone who can do the job, they want to find talent that is the perfect fit with the culture of the organization.
With an employee referral, your current employees are vouching for the trustworthiness and quality of the candidate. If you trust your current staff and have good relationships with them, an employee referral program will help you find similar candidates who your current employees want to work with. This will help you improve the overall culture within your organization.
Conclusion
Employee referral programs are an excellent way to take a lot of the stress out of hiring new employees.
This is while improving the quality of hires at the same time. It will improve your hiring goals. And it will also help employers improve the overall culture within their organization.
A more engaged workforce and higher quality talent is something that no employer would say no to. Offering employee referral incentives is one of the best ways to achieve this.