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Top 10 Employee Referral Statistics To Know

Smart companies nowadays are integrating employee referral programs in their recruitment process because of the obvious benefits it can bring. You can find better candidates, who will stay longer with the company, through employee referral programs as opposed to employees recruited by other means.

Referral recruiting works because your employees are familiar with the work culture and ethics needed in your company, and high-performing employees are likely to refer candidates with similar qualities.

Statistics that matters:

Additionally, traditional recruiting can come at a high cost, between $4,285 to more than $18,000 per hire, and that can really add up. Recruiting with a referral program, on the other hand, only costs about $1,000 per hire.

An employee referral program is a powerful recruiting tool, and here are 10 more reasons why you should get on with it:

1. Higher retention rates

If you have an employee referral program, you can have an average retention rate of 46%, compared to the 33% retention rates of organizations that only use career sites.

2. Faster training and onboarding 

New hires coming from employee referrals are trained and onboarded faster than hires from other sources. They also tend to start their jobs sooner than other hires: candidates from career sites start after 55 days; those found on job boards start after 39 days; and employee referrals start after 29 days.

3. Third-party software systems are helpful

About 33% of companies use third-party software systems like Firstbird to manage their employee referral programs.

4. Incentives work 

Employees are more motivated to refer potential hires if there are incentives, which is why almost 70% of companies offer between $1,000 and $5,000 in cash incentives for staff members who are able to refer qualified candidates.

5. Vacation days also work as an incentive

15% of companies offer time off or additional vacation days as an alternative to cash incentives.

6. Automation is key

75% of companies prefer to use employee referral program systems that allow for automated or semi-automated processes.

7. Most companies prefer referral candidates

They are 3-4 times more likely to be hired than non-referral candidates.

8. Referral hire do not only come from employees

41% of referrals come from the organization’s external network.

9. Referral hires bring in money

New hires sourced via referral programs produce 25% more profit for their companies than new hires sourced via other means.

10. Referral programs is cheaper

It can save organizations $3,000 or more per hire.

Overall, there are a lot of positive things to gain from implementing an effective employee referral program. It saves you time, money, and energy throughout the hiring process.

Interested in implementing an employee referral program? Firstbird’s online recruiting software can help you get started, learn more on our free demo.

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Majella Grawatsch

Originally from Brisbane, Australia, Majella completed her studies with a Bachelor of Business majoring in advertising from Queensland's University of Technology. After a few years of working in the gaming and entertainment industry in the APAC market, she moved to Vienna, Austria and joined the Firstbird team as a copywriter in 2016. She has never looked back, and now works across marketing, partnerships and sales in Firstbird’s international team.

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Employee Referral Benchmark Study


We collected data from 143 companies, and, in the following study, we provide you with the answers.

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