Why should I focus my job search efforts on using an Employee Referral Program?
I’m Bonnie Roberge, SHRM – SCP. I’m somewhat new to the team here at Medical Sales Mentors, where I serve as Director of Employer Relations.
I believe employee referral programs (ERPs) are the new benchmark for finding your new role. It took us 22 years, but we built a small army of inside contacts who are part of the ERPs at several hundred employers within medical device, biotech and pharma. These folks are all previous customers of ours, well call them “trust agents” and they help us help you land the right role.
According to many credible sources, ERPs have a major impact on the quality of hiring, employee engagement and employee retention. What’s most amazing to me is ERPs have been around for awhile yet have had greatest impact in only the last few years. I suspect ERPs were such a novel idea met with initial resistance by employers. Let’s take a look at why these programs are becoming so valuable to employers and why they will be growing over the year of 2019.
According to research of HireHive - recruiting software marketers, “The smallest number of applications, but the greatest number of hires come from internal referrals”. HireHive’s expertise concludes the value of the employee referral as a credible source for insight to hiring managers on candidates’ skills or characteristics that set a candidate apart. Who else to provide that information but the candidates friends, professional acquaintances, or their former colleagues. HireHive states: “Referrals from employees are an ideal way to source candidates”.
According to sources at CareerBuilder, 82% of employers rated employee referrals above all other sources for generating the best return on investment (ROI). John Hollon, the editor of Recruiting Daily, the #1 online media resource for the recruiting world, employee referrals are the best source of new hires, “If you aren’t getting at least 25-35 percent of your hires this way, you’re simply hurting your organization and ensuring that your recruiting will be a lot more costly, and time-consuming, in the months and years to come.”
LinkedIn's research highlights some more interesting data which shows how employee referral programs significantly reduce time to hire:
· Traditional hiring methods such as posting job ads, combing career sites and retaining an outside recruiter can take up to 55 days from start to finish.
· On average, it takes a company 29 days to hire a candidate who was referred by an employee.
· LinkedIn's research, further concluded ERPs help companies save money they would otherwise spend on job advertisements, agency fees or recruiter commissions.
Dr. John Sullivan, the head of the Human Management Program at San Francisco State University and an expert in employee referral programs, says that: referrals were #1 as the “most productive” source for diversity hires, well ahead of major job boards, company affinity groups, and diversity career fairs. He states 88% of employers he spoke with said that referrals are the #1 best source for above-average applicants. (Source: Dr. John Sullivan research)
According to research from Firstbird:
· After one year, retention of referred employees is 46% compared to 33% from career sites and 22% from job boards.
· After two years, retention of referred employees is 45% compared to 20% from job boards. Retention also increases for employees who refer candidates. Firstbird Research shows that employees who make successful referrals stay longer at the company. Candidates can also get the strait scoop on company culture and work environment.
According to Edelman Trust Barometer, employee voice is 3x more credible than the CEO’s when it comes to talking about working condition in a company.
A study by Glassdoor’s Chief Economist Dr. Andrew Chamberlain showed that referred candidates are more likely to accept your job offer. It makes sense since the job has been introduced to them and guaranteed for by a trusted source – the employee!
Paul Petrone’s (SR Editor for LinkedIn Learning) article states: According to a study by JobVite, on average it takes 29 days to hire a referred candidate, compared to 39 days to hire a candidate through a job posting or 55 days to hire a candidate through a career site.
It’s clear ERPs drive talent acquisition for advertised jobs. But what about unadvertised roles in medical sales? Turns out ERPs have a profound impact there! More on that subject in a pending article.
Bonnie Roberge, SHRM - SCP https://www.linkedin.com/in/bonniekroberge/