It hasn’t taken that long for employee referrals to become one of the most important sources for potential hires for companies. This innovative yet uncomplex method, brings an inward flood of top talent, who are easy to on-board, fit seamlessly into the company culture, and are generally happier at work.
In fact, an iCIMS report found that companies get 24-40% of their new hires from referrals, where nearly two-thirds of employers implement an employee referral program. So, what makes employee referrals such a preferred method of recruitment? Here are some of the top reasons:
Better employee performance
A lot of employers observed that referred hires tend to perform better than employees that come from other sources. This could be a result of being recommended by your awesome employees, and you know how the saying goes, birds of a feather, flock together. Your employees are highly more likely to recommend someone who shares a similar work ethic and someone who can produce great outputs.
Easier to integrate
Referred people tend to integrate better into a new workplace because they’re usually a better cultural fit than other hires. In fact, 76% of employers say that cultural compatibility is of paramount importance for them when screening potential candidates. Afterall, you wouldn’t want to lower a freshly hired employee’s productive levels, simply because he feels like a fish out of water within your business’s cultural environment.
Happier than other non-referral hires
The iCIMS report noted that referred employees are generally happier and more satisfied with their current job than with their previous where they were not referred.
In fact, if referred recruits work more than five years in a company, their company culture satisfaction and their ability to deliver good output tends to increase. A happy and satisfied employee will speak highly of your company to others and will most likely refer others as well; with almost two-thirds referring at least one person to another open position.
Cheaper to implement
Typical recruitment methods cost companies around $4,285 to well over $18,000 per hire. In contrast, recruiting through a referral program will only cost about $1,000 per hire. It’s a staggering difference that highlights the efficiency of the latter.
This is quite beneficial for businesses who may not have much capital to spend on expenses like hiring. The fact that referrals stay with the company longer than non-referral recruits means companies save more money in the long run.
Employee referral programs are a major game-changer for recruitment because it’s easy, cost-efficient and brings in so much value in terms of quality of hires. If your company is serious about upping their recruitment methods to keep up with the current business landscape, then you should definitely explore employee referral programs such as Firstbird.