Reasons WhyEmployee Referrals Matter toSmall to Mid-sized Businesses
CLICK BELOW TO LEARN MORE ONW H Y R E F E R R A L S M AT T E R :INTRODUC TION1. help you hire faster2. lower your cost per hireOne of the toughest challenges small to mid-sized businesses (SMBs)3. deliver high-quality candidatesface is competition for quality talent. Eighty percent of companies say4. increase employee retentionthere is a skills shortage, and finding the best candidates is gettingharder.5. protect corporate culture and build your brandThe good news is that when it comes to finding new employees, youhave a hidden team of super recruiters just waiting to step in. They’reyour employees!Employee referrals can help you find the right candidates cheaper,faster and better than many traditional methods. In fact, it’s one of thetop ways candidates learn about new job opportunities.If you’re not leveraging this valuable resource, you could be missingout on finding your next high performer. Check out the five reasonswhy SMBs should be using employee referrals to grow teams:Get inspired by 6 referral programs from:Booking.comGoogleInMobiPureGoDaddyEnterprise Rent-A-Car2
1WHYOn average, it takes a company 29 days to hirea candidate who was referred by an employee.If you are in a hurry to fill a vacancy, this mightEmployee referralsHELP YOU HIRE FASTERbe the best method of hiring.Referred workers are also more likely to referfuture employees, creating a never-endingTraditional hiring methods such as posting job ads, combing careerpipeline of candidates for future hiring needs.sites and retaining an outside recruiter can take up to 55 days fromstart to finish. Employee referral programs, however, can reduce yourhire time significantly.Most hiring methods takeReferred hires only take5529days3days
2WHYEven if you award a cash bonus to employees whosuccessfully refer a new employee, the amount youspend will likely be less.Employee referralsL O W E R YO U R C O S T P E R H I R EEmployee referral programs help you save money you might havespent on advertisements, agency fees or recruiter commissions. Infact, employee referrals produce the highest ROI of any sourcingmethod.For example, if an agency charges a fee of 15% of thenew hire’s first-year salary, an employee who earns 100,000 hire would cost your company 15,000 toacquire.TIP: Offer employees a healthy referral bonus (e.g. 2,000 to 5,000), and enjoy significant savings.One more cost saver:One more cost saver: because referredemployees are faster to hire, you will save moneyon internal labor costs or outsourcing.4
3WHYThe referring employee will want to protect his orher reputations. They’ll be careful to screen andonly suggest people who would be high performersbecause they won’t want to jeopardize their own careerin the process. In fact, a study found that A-players,or high performers, were more likely to refer otherA-players.Employee referralsDELIVER HIGHQ U A L I T Y C A N D I D AT E SEmployee referrals also include those hard-to-find,“passive” job seekers. Ninety percent of LinkedInmembers say they’re at least somewhat interested innew opportunities. While some are actively looking,many are simply open to learning about new roles.Candidates who are referred by employees tend to be higher quality.According to a study by CEB, 69% of potentialapplicants say they don’t know where they’d go if theyleft their current job, and the number-one way theydiscover new opportunities is from someone theyknow.69%5of LinkedIn members are interested innew job opportunities.
4WHYEmployees who are referred tend to stay at their jobslonger than traditional hires, reducing the time andresources you’ll need to put into future recruiting. Ina study by JobVite, 46% of referred hires stayed forat least one year after they were hired, as comparedEmployee referralsI N C R E A S E E M PLOY E ERETENTIONto 33% of people hired through career sites and 22%hired through job boards. Two years later, 45% ofreferred hires were still there.Retention also increases for employees who refercandidates. Research shows they’re more likely to stickaround the company longer because they feel a senseEmployee referral programs help you save money you might haveof community as well as a level of responsibility to thespent on advertisements, agency fees or recruiter commissions. Inemployee they recruited.fact, employee referrals produce the highest ROI of any sourcingmethod.633%46%of career site hires stayat least one year.of referred hires stayat least one year.
5WHYEmployee referralsP R O T E C T C O R P O R AT EC U LT U R E A N D B U I L DYO U R B R A N DEmployees who enjoy their job will wantto protect the corporate culture by onlyreferring candidates they believe to be agood fit. Most tend to refer people who aresimilar in work style and ethic to themselves.Employee referral programs also turnemployees into brand advocates. If someoneEmployee referral programs provide employees with a greater senseof value and engagement by giving them a role in the hiring process.7is talking to a friend about a job opening,they are sending the message that yourcompany is a great place to work.
Grab these ideas forC R E AT I N G A S U C C E S S F U L E M P L O Y E EREFERR AL PROGR AMThe overwhelming majority of recruiters (87%) agree that the number-one way to boostreferrals is through better employee engagement, however, just 20% are happy with employeeinvolvement. How does your SMB implement an employee referral program and get youremployees on board?Be inspired by these six powerhouse businesses that leverage employee referrals to find newtalent and solve their hiring e Rent-A-Car8
W H AT T H E Y N E E D E DMore bilingual employeesW H AT T H E Y D I DDoubled the referral bonus, and even brought Portuguesefood for the office for lunch, with a note requesting Portuguesespeaking referrals!R E S U LT SPortuguese-speaking referrals spiked, and referrals became the#1 method of finding talent, sourcing 41% of US-based customerservice ise Rent-A-Car
W H AT T H E Y N E E D E DReturn to Google’s roots where referrals were the best and largestsource of new hiresW H AT T H E Y D I D“Nudged” employees by asking specific questions, such as“Who’s the best finance person you’ve ever worked for?” or “Doyou know a great salesperson in New York?”R E S U LT S33% increase in referred prise Rent-A-Car
W H AT T H E Y N E E D E DGood tech talentW H AT T H E Y D I DGot rid of cash bonuses, instead offering trips and gifts – like amotorbike that they parked in the headquarters lobbyR E S U LT SThe number of successful tech referrals increased from 20% prise Rent-A-Car
W H AT T H E Y N E E D E DIncrease successful referrals without high brand recognitionW H AT T H E Y D I DAsked new hires for referrals within their first 30 days, making itclear that recruiting is part of everyone’s jobR E S U LT S40-60% of new hires are from employee nterprise Rent-A-Car
W H AT T H E Y N E E D E DA top-of-mind employee referral programW H AT T H E Y D I DCut the referral bonus by two-thirds, instead spending money onmarketing such as software that broadcasts content and jobs toemployees and T-shirts for top referrersR E S U LT SSuccessful corporate referrals nearly doubled, reaching thecompany goal of ise Rent-A-Car
W H AT T H E Y N E E D E DTo drive referrals from the top downW H AT T H E Y D I DCreated a friendly competition by posting a leaderboard thatshows top-ranking regions by the number of referrals receivedand hiredR E S U LT S30% of all new hires are referrals, with the CEO initiating morereferrals than anyone rise Rent-A-Car
E X PLO R E L I N K E D I N R E FE R R A L S FO R YO U RS M A L L TO M I D -S I Z E D B U S I N E S S (S M B) .Automatically uncover quality hires by engaging your employees, unlocking their networks, and inspiring everyone torecruit. With LinkedIn Referrals, your employees can easily access and utilize the seamless referral tool that suggestsconnections for the right open roles.Get quality referrals and start hiring world-class talent for your SMB.15Contact usLearn more1-855-655-5653bit.ly/LNKDreferrals
new hire’s first-year salary, an employee who earns 100,000 hire would cost your company 15,000 to acquire. TIP: Offer employees a healthy referral bonus (e.g. 2,000 to 5,000), and enjoy significant savings. One more cost saver: One more cost saver: because referred employees are faster to hire, you will save money