There are countless benefits from implementing an employee referral program. From the amount of referrals you’ll get compared to other sources, to the low cost benefit, there are numerous ways your company can reward itself with a good employee referral program.
At the same time, a good employee referral program can mitigate two critical areas of talent acquisition: the quality of a candidate, and the amount of time that a candidate will stay with a company. FurstPerson has found that in some cases, early attrition can cost a company $4,500 per candidate on average, and bad hires can not only affect your company’s workflow, but also the employee culture, customer service experience, and anything else the bad employee may be in contact with.
But with all the benefits, there are still a lot of companies that struggle with, or don’t offer, an employee referral program. These obstacles can seem cumbersome, and even act as a repellant, when considering whether or not to begin an employee referral program, or improve on an existing one. However, the benefits significantly outweigh the challenges with maintaining a referral program.
There are two statistics you need to be aware of when considering how effective an employee referral program can be:
- Statistically, it has been found that employee referrals are the top source for candidate quality. This means out of every other possible strategy you can think of – job boards, walk in applicants, job fairs, or something else – no other talent acquisition source has a better average of overall performance than employee referrals.
- Additionally, employee referrals reign supreme in terms of retention. In fact, 46% of referred candidates staying at least a year with the company they were hired with – compared to just 33% from job boards on a company website, and 22% from a third party job board site.
These numbers speak volumes on the importance of the benefits an employee referral program. For more information on talent acquisition ideas, download FurstPerson's e-book below:
Topics: Talent Selection Ideas