Strong talent is invaluable and is one of the greatest resources in any organization. Yet, the cost of building your workforce can be tremendous. While data from the Society for Human Resource Management indicates the average cost per hire in the U.S. is $4,700, some employers assert that hiring costs can be three to four times the employee’s salary. Regardless of where your hiring costs fall on this spectrum, they can add up over time. It’s no surprise that many employers are seeking ways to lower hiring costs without compromising access to top-tier talent.
As you fine-tune your recruitment efforts and consider how to reduce the cost of hiring, here are some options to bear in mind.
How to reduce hiring costs
1. Leverage your current workforce
One of the best resources for attracting new talent is the talent you already have. Your current employees may know someone looking to switch jobs, and tapping into their connections could help you save. To execute this, you’ll have to design and implement an effective employee referral program.
Start by identifying your strategic goals for the program. These could include reducing overall recruiting costs, cutting down time-to-hire, and improving the recruitment of passive job seekers. From there, you’ll want to think through the process and establish rules for participation. The process should be simple and user-friendly, and should establish clear parameters that can help reduce the administrative burden later. For example, you may want to create a basic form for employees to use when they’d like to submit a referral. You’ll then want to decide who can participate in the program—HR and hiring managers may need to be excluded due to conflict of interest. Finally, determine which rewards will be used to incentivize referrals, such as gift cards, extra PTO, or bonus payments.
2. Implement automation
Many organizations are already using automation in their recruitment process to some degree, but there may be opportunities you’re overlooking. If you aren’t already using HR software to source candidates and screen resumes, these are good places to start. These two activities require significant time investments, but they can also be done by software easily and effectively. Artificial intelligence and machine learning tools can match phrases in your job descriptions with candidates’ applications or resumes to ensure the best match.
Beyond these activities, however, you could also introduce digital tools for other aspects of the hiring process. Automated interview scheduling and offer management are also some simple ways to save. The less administrative work your HR team has to do, the more you’ll reduce the amount of work dedicated to hiring activities.
3. Refine your job postings
A clear and compelling job posting will effectively communicate the role’s expectations to potential candidates. This means you’ll be more likely to attract candidates who actually fit your needs and can dedicate more time and resources to positive onboarding and employee experiences.
A strong job posting will include the terms your ideal candidate would search for on a job board. Make sure the core responsibilities are spelled out clearly and indicate whether the role could be full-time, part-time, or remote. Then, add some key features that set your organization apart from your competitors. You can highlight your core values, as many job seekers consider environmental, social, and governance (ESG) factors when choosing an employer, but be sure to also advertise benefits packages, career development, and any other notable perks.
4. Build a talent pool
You’ll spend far less on recruiting costs if you can minimize the amount of recruiting you have to do in the first place. One way to scale back on your overall recruiting efforts is to build a talent pool.
Often, employers will get dozens of qualified applicants for one position. Instead of deleting all those applications and resumes, create a stockpile you can pull from when future needs arise. Be particularly mindful of the candidates who have already progressed through a portion of the screening process, as this could save you even more time down the road.
5. Spend less on job boards
Job boards can certainly be a valuable tool for attracting talent, but fees for employers have skyrocketed in recent years. You’ll therefore want to be choosy about the ones you use. In some cases, it may make sense to use boards geared specifically to your industry. In other cases, you may want to reach the broadest possible audience, so a major site like Indeed, ZipRecruiter, or CareerBuilder might be useful. These boards usually offer free listings, but they may have limited visibility for candidates or restrictions for viewing applicants’ data.
If you regularly use job boards, consider implementing HR software that can track how successful each job board is when it comes to delivering qualified talent. Finally, don’t forget to try social media as an alternative to job boards—LinkedIn, Twitter, and even Facebook could generate some quality leads.
Oyster can help with all things hiring—including keeping recruitment costs down. Find out how much it could cost to hire employees in your target country with our convenient employment cost calculator.
About Oyster
Oyster is a global employment platform designed to enable visionary HR leaders to find, engage, pay, manage, develop, and take care of a thriving distributed workforce.
Oyster lets growing companies give valued international team members the experience they deserve, without the usual headaches and expense.
Oyster enables hiring anywhere in the world—with reliable, compliant payroll, and great local benefits and perks.
