Attracting and retaining talent has grown harder in recent years. Between the growing talent deficit and the changing mindsets of both workers and organizations, recruitment is no longer as simple as it once was. Job openings sit open longer, recruiters put in more work, and talent doesn’t always match expectations.
One way to help simplify recruitment while also bringing in top talent is garnering referrals through crowdsourcing. The talent shortage has created a significant deficit in highly skilled candidates. Many organizations are relying on contingent labor to help close the gap, but it can still be difficult to find qualified candidates. Referrals can help to close that gap. The highly skilled talent you already have in your talent pools has an extended network of other highly skilled talent. It makes sense to utilize those connections, but tapping into that network can feel intimidating without the automation or technology in place to do so in a scalable way
What is Crowdsourcing?
Crowdsourcing is nearly as it sounds: it is a form of outsourcing, sourcing from a crowd or group of people. This method essentially leverages the vastness of the internet to gather like-minded people for a single cause. Investopedia defines it as “obtaining work, information, or opinions from a large group of people who submit their data via the Internet, social media, and smartphone apps.”
What skills are being sourced will vary as will the crowd it is being sourced from. Though this is typically focused on fundraising, crowdsourcing can be used to enlist large numbers of people for a variety of reasons. The sourced assistance can work together to solve problems, test products or softwares, or even fill open job positions.’
Using Crowdsourcing in Talent Acquisition
Crowdsourced referrals are growing in popularity. Your employees, contingent workers, and pre-vetted candidates have their own networks. By crowdsourcing referrals, you can access previously hidden or inaccessible pools of talent (many of whom are passive candidates but would consider a position if it were the right fit) through multiple networks. In fact, this is a more effective recruiting tactic than posting job openings on career sites or job boards.
Amber Hyatt, SHRM-SCP, vice president of marketing for SilkRoad, said “Employee referrals have excellent conversion rates from interview to hire, as well as typically longer tenure with the organization.” She’s not wrong. LinkedIn found that 46% of referral hires stay on at least a year versus 33% from career sites and only 22% from job boards. Referrals from employees and pre-vetted candidates are more likely to be hired than candidates from other sources. Though the number of referral applicants is smaller, with only about 7% of the applicant pool, they account for 40% of all hires.
It is no wonder that 88% of major employers would name referrals as their number one source for above-average applicants. The connections that your current workforce and potential candidates have access to offers you an excellent source of talent. These are highly skilled people, sometimes with highly specialized expertise, who likely have a network filled with like-minded individuals who have similar credentials. Another LinkedIn study noted high-performing employees were more likely to refer other high performers.
An added bonus is that referred workers are more likely to refer future employees thus creating an even larger crowd of qualified candidates to source from. Crowdsourced referrals essentially build a large network of independent recruiters who are incentivized to bring you top talent that suits your needs for the role, especially if they are incented to do so.
Benefits of Crowdsourced Job Referrals
Outside of the obvious—reaching a larger network of highly qualified candidates—there are many benefits to utilizing a crowdsourcing referral recruitment strategy. How can you benefit from this recruitment method?
- Faster recruitment. Job referrals, whether through an employee referral program or other means, reduce time-to-hire significantly. The industry average is 55 days for most hiring methods but with referrals, it is 29 days. That’s nearly a month sooner.
- Lower recruiting costs. Not only is this a cost-effective recruiting method, it can save employers thousands of dollars per hire. In fact, one study found that 82% of employers believed referral hires yielded much higher return on investment (ROI).
- Better quality-of-hire. Beyond retention rates, the talent pulled in through the crowdsourced job referrals tends to be a higher quality candidate than those sourced through other means. Top talent has access to top talent allowing you to “scout the best talent” available. These candidates also tend to be better culture fits for the company, leading to higher retention rates.
- Increased chance of hire. The better quality candidates and culture fits also lead to an increase in the chance of hiring the referral. WorkLLama saw a 900% increase in placements through its referral system. As mentioned above, though they only account for 7% of applicants, they fill 40% of the roles.
- Higher retention rates. 46% of referral hires stay on for more than a year, with many staying on for even longer. Some studies have found that 45% of referral hires stayed on for four or more years while others found referral hires were 30% less likely to quit their job.
- Lessen recruiter workload. By automating the recruitment process through referrals and other means, you can cut back on the recruiter workload and reduce time-to-hire by 66% per hire.
WorkLLama’s Crowdsourced Job Referral System
WorkLLama is familiar with the effectiveness of using job referrals to fill talent pipelines with high-quality and highly skilled talent. We believe that referral systems are underutilized. You can expand your talent pools through referrals by asking employees and contingent talent to refer qualified candidates from their professional and social networks. The WorkLLama platform makes referral management simple. How? By leveraging technology to automate the process.
Thanks to our platform’s automation and dynamic talent pooling capabilities, you can deliver personalized talent marketing that helps to nurture and engage talent at scale, all while building brand awareness. Plus, our omni-channel conversational chatbot, Sofi, can quickly source and onboard talent. This can take the time to engage referrals from two weeks to less than two days! Our platform has seen a 300% increase in candidates sourced by job referral and a 66% reduced time-to-hire.
Want to build out an incentivized employee referral program? WorkLLama can help. We partner with Siemans to establish rewards programs with options for payout, including a flat bonus, flat bonus plus hourly pay rate increase, hourly pay rate increase, points system, and other reward payouts. We also track the referrals from start to finish with a simple-to-use system that offers unparalleled transparency to all parties.
Leverage the talent you’ve already attracted and expand your candidate reach with a simple-to-use referral system. 10X your talent pool today. Schedule a demo!