What is the most common ‘nay’ a recruiter hears when reaching out to new clients?…
“It is cheaper for us to do our recruiting internally.”
In these situations, it is usually a Human Resources manager paired with the team or department lead that are in charge of finding and placing talent from start to finish. This is a huge undertaking considering that the HR manager is also in charge of managing compensation and benefits, managing federal HR compliance and audits, mediating employee complaints and performance reviews, among a plethora of other things that can pop up at any given moment.
The hiring process also takes valuable time away from the hiring manager and their specific projects and objectives. This person may not have experience or interest in the hiring process and view it as a poor use of their time.
On the surface, this arrangement makes sense. However, is it really logical to think that someone that is always on call to deal with conflict, sensitive information, and employees’ questions paired with another that is inundated with their own department’s deadlines and projects have the time to find the very best candidates for your company?
Consider the hard, non-refundable costs of doing all of your recruiting internally:
Say you are hiring a Director of Marketing ($165,000), and you are recruiting internally. It is safe to assume that the key players will, at the very least, be the HR Manager (median salary of $90,000 or $43.27/hr) and the VP of Marketing ($220,000/year or $105.77/hr).
We will combine the hourly rates for the Director of Marketing and the HR Manager to find the estimated cost of hiring internally, starting our search with 15 resumes:
Writing job spec for job postings– 2.5 hours $372.60
Speaking to job boards and posting adverts – 3 hours $447.12
Fielding calls from recruiters & applicants – 6 hours $894.24
Reviewing CV’s – 8 hours $1,192.32
Telephone Interviews (30 mins x 15 interviews) – 7.5 hours $1117.80
Face to face interviews (1 hr x 10 interviews) – 20 hours $2,980.80
2nd Interviews (1 hr x 5 interviews) – 5 hours $745.20
Subsequent meetings about the interviews – 4 hours $596.16
Making offers (emails / calls / paperwork) – 1 hour $149.04
Total – 57 hours
Cost of job postings (CareerBuilder/Monster) – ~$400 for each posting @ 2 postings
Grand total – $8.895.28
These are only the hard costs. What soft cost may also be leaking valuable time and dollars?
1. Your job search may take longer to fill and cause continued stress to current employees.
What is the cost of having this position open? How much stress is the rest of the team absorbing by picking up the slack? Depending on the nature of the position, you may be starting from square one or close to it. Recruiters have a built in network, and are masters of recruiting passive talent.
2. You may not have access to the best fit the first go round.
When you are limited on time and resources, it makes sense to search for resumes through job boards and direct postings. However, research shows that some of the best candidates are passive candidates. It is the recruiters job to constantly build her network and stay in touch with talent that are not actively posting their resume or applying to job board postings. Your job posting may have all of the right keywords, but the best candidates may not be searching for them at all.
3. Adopting a ‘no recruiters’ policy leaves no safety cushion.
Despite careful screening and multiple interviews, sometimes an employee is simply not the right fit. It probably has nothing to do with their skills and their ability to do the work. Perhaps it is a personality clash with team members, or they do not connect with the company culture.
First of all, it is the recruiters top priority to get to know your organization and culture and to ask the right questions to candidates before they are presented to you. Candidates are offered and accept jobs because of their skills; they leave them because of culture or fit.
Secondly, a recruiter’s fee (typically 25%-30% of the candidate’s compensation), may seem more expensive in the short term, but rarely ends up costing more in the long term. Recruiters’ networks have been built over years of industry experience and are always expanding. We only present our clients with the very best candidates.
Finally, If for some reason you find the candidate we place is not the best fit, the recruiter will replace the candidate at no cost. If your internal team has to go back to square one, you are looking at almost $18,000 for round two and even more time where your current employees are overworked, disengaged, and becoming less and less productive.
Are you ready to start thinking strategically about your hiring practices and to invest in the long term?
MRI Chattanooga 