Canadian Employers say Employee Referrals Trump Online Job Postings for Recruiting

In Tight Labour Market, Employers Need to Use All Available Tools to Attract Talent

In a tight labour market where finding the right candidates with the right skills is a growing frustration, many businesses are turning to their own employees as the preferred recruitment tool. According to a new survey from Express Employment Professionals, employee referrals rank as the most effective way to find new talent, with online job postings coming in third.

In the Express survey of businesses, 33% of respondents ranked employee referral as the most effective recruiting tool. Staffing firms were ranked second (at 26%), followed by online job boards (at 24%), with social media (6%) and professional job boards (3%) lagging far behind.

Express franchise owner Sasha Malik in St. Catharines, Ontario, has noticed the increased use of employee referrals as a recruiting tool and believes its effectiveness can be traced to one important reason: the human element.

“The human element goes a long way in making the recruitment process more successful,” Malik said. “You’re not just telling a friend to apply online or send in a resume. There will be an interested and engaged individual on the other end who genuinely wants to help them become employed if they are the right fit.”

“We also find the interview attendance rate is higher on referral applicants in comparison to other applicants, perhaps due to a higher level of engagement and investment,” Malik added. “For example, an employee won’t refer someone who would reflect on them poorly, and someone who has been referred probably doesn’t want to let their friend down or hurt their friend’s reputation with their employer.”

Express franchise owner Brent Pollington in Vancouver, British Columbia, is also seeing more employers use employee referrals to recruit workers.

“Employers are definitely using employee referrals more often, because in our extremely competitive market, they need to do anything and everything they can to attract the best talent,” Pollington said. “And employers are providing significant incentives for employees who refer someone that ends up being hired. Money is the most common incentive and I’ve heard of as much as $5,000 being offered for higher level positions.”

Pollington agrees that the human element is what makes a recruiting tool more successful.

“Online job boards are a convenient solution, but they have a lot of deficiencies and many applicants say they feel like they are a black hole,” Pollinton said. “Without the human element, it’s a lot harder to find the right fit. For example, online job boards don’t match the soft skills an employer may be looking for like a staffing firm can. Also, online job boards aren’t effective in finding other jobs for an applicant if the one they are applying for isn’t a good match.”

Although the human element is important, both Express owners recommend employers use a variety of recruiting tools to find qualified workers.

“It’s good to do your market research and learn what works best for your industry or specific job,” Malik said. “You won’t know if a recruiting source works unless you try it. I find there are different strategies for different roles. Most employers will focus the majority of their time and efforts on referrals, staffing firms and online job boards, but also spend time utilizing other resources like job fairs, social media, trade shows, etcetera.”

“Employers are having a hard time finding qualified employees in our market, and the problem is getting worse,” Pollington said. “Companies are so desperate for workers they are foregoing interviews and just asking people to show up the next day. When someone agrees, it leaves the business feeling like they’ve solved the problem only to find the person doesn’t show up the following day or their skills are nowhere near what they described over the phone. It definitely takes time to find the right fit, especially with skilled positions.”

“The problem employers have of finding qualified workers in a tight labour market is one that does not appear to be going away anytime soon,” said Bill Stoller, CEO of Express. “Employers should be using a variety of methods to recruit in a tight labour market, but the most important thing that seems to make a recruiting tool successful is a personal touch.”

The survey of 491 businesses, which are current and former clients of Express Employment Professionals, was conducted in February 2019.

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