7 Ways to Reduce Your Cost-per-hire

Are you utilizing all of these 7 highly effective ways to reduce your cost-per-hire?

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Every HR professional’s dream: Reducing cost-per hire

Cost-per-hire is one of the most important and most commonly used hiring and recruiting metric.

➡️ Download the Checklist of Most Important Hiring Metrics & Tips for Improvement!

It is also the metric which gives most HR professionals a serious headache!

They are asked to find and hire top talent fast, but often lack all the needed resources, especially financial.

So without further ado, let’s take a look at the X most effective ways to reduce your cost-per-hire!

Most effective ways to reduce your cost-per-hire

Here are top 6 ways companies can reduce their cost-per-hire:

1. Free job boards

Many companies spend a lot of money to post their job openings on job boards. However, there are also many free job posting sites and job boards which allow employers to post their job openings for free and reduce their recruiting costs.

➡️ Check out the list of The Best Free Job Posting Sites!

2. Employee referral programs

Do you have a structured employee referral program? Is it effective? Did you think about offering innovative employee referral incentives in order to increase its popularity? Employee referral programs can improve time, cost and quality of hire. It’s a win-win-win!

➡️ Check out our Guide for Setting Up an Employee Referral Program!

3. Talent pools

Building and maintaining a talent pool of interested, qualified candidates can do wonders for your cost-per-hire. Imagine tapping into a pool of great, interested candidates every time you have a new open job position!

➡️ Learn Everything You Need to Know for Building and Maintaining a Talent Pool!  

4. Group interviews

Conducting interviews with multiple candidates at once is a great way to save your time – and money! Group interviews are a fast and affordable way to test a group of candidates and select the best ones among them.

➡️ Check out the Guide for Conducting Group Interviews!

5. Outsourcing

Using a recruitment agency is not always expensive. Sometimes you can even save money if you decide to use a recruitment agency’s services! Just make sure you weigh all the pros and cons of using a recruitment agency in order to make an informed decision.

➡️ Check out The Ultimate Guide for Choosing a Recruitment Agency!

6. Recruitment software

Modern recruitment software has many benefits and features which can help you make your hiring process faster, more streamlined and effective, thus saving your time and reducing your recruitment costs.

➡️ Download free eBook 2019 Guide for Buying a Recruiting Tool!

7. Social media

Do you use social media to proactively search for candidates totally free, promote your employer brand and showcase your company culture? It’s a highly effective way to attract potential employees – and it’s totally free!
➡️ Learn How to promote your employer brand on social media!

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How Can an Effective Talent Pool Improve Time, Cost and Quality of Hire?

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Building and maintaining an effective talent pool will help you improve 3 most important recruiting metrics: time, cost and quality of hire.

Talent pooling: A proactive recruiting strategy

According to Robin Erickson form Deloitte, “The task of recruiting has moved from the reactive filling of requisitions to proactively court high-quality talent.

The only way to proactively court high-quality talent is to build and maintain an effective talent pool. Besides for engaging top talent, talent pools are also a very effective recruiting tool which can improve all the most important recruiting metrics, such as time, cost and quality of hire.

How talent pools help in recruiting top talent?

In today’s job market, an overwhelming majority of job candidates are passive job seekers. According to LinkedIn, 73% of your potential job candidates are passive job seekers. Passive candidates are already employed. Of course, top talent is high in demand so the chances are they are already employed.  This is the reason they actively look for a job. However, they would be willing to accept a better job offer. LinkedIn’s Global Talent Trends 2016 reports that a massive 90% of global professionals are interested in hearing about new job opportunities

However, these passive job seekers need to be convinced that getting a job at your company would be a step up for them. If you manage to get these passive job seekers to join your talent pool, you will have to build relationships with them, foster candidate engagement and keep your company on the top of their mind until the moment they are ready to change jobs.

How to create and maintain an effective talent pool?

Building and maintaining your talent pool is hard work. First, you need to fill your talent pool with high-quality candidates. You have to apply the best practices of lead generation to build your talent pool. Then you need to properly segment your talent pool. After you’ve done all that, the real works begins. You need to maintain your talent pools by engaging in relevant and interesting communication with your candidates. You need to create and distribute specialized recruitment content for every step of the candidate journey.

Yes, it’s a lot of work. However, all the time and effort invested in building and maintaining your talent pool is very well worth it!

Main benefits of an effective talent pool

Building and maintaining an effective talent pool will help you improve 3 most important recruiting metrics: time, cost and quality of hire.

Talent pools reduce time to hire

A properly segmented and managed talent pool will ensure that the candidates in your database are engaged and eager to work for your company. That way, when you have a new job opening, you will be able to choose between qualified, interested candidates from your talent pool.

This will significantly lower your time to hire because you will be able to skip the whole process of advertising your open job position through different channels and waiting for great candidates to apply. Instead, you will already have a pool of great candidates you can choose from!

Talent pools reduce cost per hire

An effective talent pool saves your money in two different ways. First of all, it reduces time to hire, which means you can save money on your HR professionals wages.The second way in which an effective talent pool will lower your cost per hire is by saving the money you would otherwise spend advertising your open job positions. Imagine the budget savings you could achieve if you didn’t have to spend money to advertise your jobs on different job boards, LinkedIn, Facebook, career fairs, campus events, etc.

Talent pools improve the quality of hire

Nobody wants to hire B-players, much less C-players. Lower quality hires happen because of four main reasons: not enough qualified applicants, not enough time to find talent, not enough time to check if the best candidate is indeed a perfect fit and because the best candidates reject your job offer so you have to settle with the second best. An effective talent pool will help you avoid all four mentioned scenarios by ensuring a steady flow of qualified job candidates, lowering your time to hire and improving your acceptance rate.

[INFOGRAPHIC] 6 Types of Recruitment Metrics You Should Know About

This infographic presents 6 main types of recruitment metrics every HR professional should track and measure.

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The importance of recruitment metrics

Tracking recruiting metrics is the key to HR analytics and data-driven recruiting.

In today’s data-driven culture, most successful recruiters are those who make decisions based on data acquired through HR technology such as Applicants Tracking Systems and Recruitment Marketing Platforms.

According to LinkedIn research, HR teams who track and measure recruiting metrics are 2 times more likely to find talent faster and more efficiently.

This is why HR professionals use hiring metrics – to make better and more informed decisions and find and hire the ideal job candidate easier and faster.

Types of recruitment metrics

Here is the list of 6 main recruitment metrics types:

  1. Recruitment Marketing metrics
  2. Hiring Velocity metrics
  3. Hiring Expenses metrics
  4. Hiring Quality metrics
  5. Hiring Source metrics
  6. Referral metrics

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1. Recruitment Marketing metrics

➡️ Definition

Recruitment Marketing metrics is a group of recruitment metrics that measure the results and effectiveness of your Recruitment Marketing strategy.

2. Hiring Velocity metrics

➡️ Definition

Hiring Velocity metrics is a group of recruitment metrics that measure the speed and duration of your hiring process.

3. Hiring Expenses metrics

➡️ Definition

Hiring Expenses metrics is a group of recruitment metrics that measure the cost of your hiring process.

4. Hiring Quality

➡️ Definition

Hiring Quality metrics is a group of recruitment metrics that measure the quality of the candidates you hire.

5. Hiring Source metrics

➡️ Definition

Hiring Source metrics is a group of recruitment metrics that measure where your candidates come from.

6. Referral metrics

➡️ Definition

Referral metrics is a group of recruitment metrics that measure the results and effectiveness of your employee referral programs.