The holiday season is right around the corner and retailers are preparing for an increase in foot traffic. 58 percent of stores expect to increase sales 6 percent this season compared to last year, according to the Michigan Retailers Association. These stores need to be able to meet the increasing demand and that means hiring temporary employees this season. There are tens-of-thousands of companies looking for season employees to help meet the customer demand. Additionally, many of these positions have the potential to turn into permanent employment.

Many companies see seasonal employment as an opportunity to attract and retain the best talent. Seasonal positions can be looked at as an audition and new hires should take initiative in showing how hardworking they are.  JCPenney plans on hiring 30,000 seasonal workers this season, an increase from last year. Ann Marie Bishop, a spokeswoman for JCPenney, explains, “getting a seasonal position allows new associates to experience working at JCPenney and decide if it suits them.” She explains that the company sees seasonal hiring as an opportunity to attract and retail the best talent.

This increase in seasonal hiring does not come without great competition. According to Bloomberg, there are about five applications for each job opening. With about 15 million Americans without a job, there are a lot of people looking for employment, even if it is only temporary. While the increase in seasonal hiring looks appealing to the unemployed, it still may not make it easier to find a position this holiday season.

While calculating cost per hire (CPH) is not an exact science, it can be a valuable instrument that gives insight into the cost of the hiring process for various positions and do some comparisons. Cost per hire can also allow companies to evaluate how effective they are with various sourcing strategies in the hiring process. However to be most effective, a company should look at all of the factors that contribute to the cost per hire.

Many contributing factors have to be considered when calculating the cost per hire of an internal recruiting team. The first factor is the recruiter who is a fixed cost since he or she is an employee of the company. Then hardware related costs have to be added in such as the computers and the telephones. Expenses to get the word out about open positions like job fairs, job boards, referral bonuses, and the applicant tracking system will also need to be added into the cost per hire calculation. Finally add in training, on-boarding, and turnover costs. Once all those costs are added up, the total cost per hire can be determined. This total cost per hire is essentially the same whether a company is hiring an inexpensive person or an expensive person because it is the same person doing the recruiting. When recruiting internally, it is also important to remember that the recruiter is a fixed capacity so he or she cannot handle any surges in hiring.

The alternative to recruiting internally is using a recruiting agency for hiring needs.  The cost per hire with a recruiting agency should encompass most of the items that are calculated into the cost per hire of using an internal recruiter

One option is using a contingency firm, who gets paid only when someone is placed into a position. Contingency firms typically charge 15- 30% of salary. This means if a company is hiring an employee who will be paid $50,000 a year, the contingency firm will charge between $7,500 and $15,000 per hire.  This can be a very hefty fee. The other option is to utilize a recruitment process outsourcing (RPO) firm.  An RPO allows companies to outsource a part of the recruitment process or the entire recruiting function. RPO’s typically result in a cost per hire of 5 – 10% of salary compared to the 15 – 30% that a contingency firm charges. Using the same $50,000 salary as before, an RPO would typically result in a cost per hire of $2,500 to $5,000.  Even by comparing the lowest CPH for a contingency firm with the highest price for an RPO, there is a minimum savings of $2,500 over a contingency firm.

When a company is faced with any level of volume hiring, the savings to the firm with an RPO exponentially increase.  This is one of the areas where real value is delivered.   Think of the cost savings of using an RPO versus a contingency firm to hire, for example, five sales personnel with $50,000 salary.  This could be a savings of $7,500 to $50,000!

Utilizing an RPO such as Hire Velocity, a company can achieve a more cost effective cost per hire while delivering flexibility and scalability in meeting hiring needs…especially in this market when many internal recruiting teams are at their smallest size.    Additionally, the RPO helps the company avoid any of the fixed cost elements of the Cost per Hire calculation.

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Recruitment Process Outsourcing, also known as RPO, involves a company turning all or some of its hiring duties over to an external company. The external company, an RPO, has the task of finding a specific number of employees using a list of specific needs and a timeframe set by the company. For example, Hire Velocity was tasked with hiring over 900 assistant store managers and bi-lingual sales consultants over the period of 12 months for a major telecommunications company. Hire Velocity saved this telecommunication company about $260 per hire made, saving the company a total of about $236,340.

Many companies are left wondering whether it would be best for them to do the hiring internally, through the use of a contract recruiter, or use an RPO to do some or all of its hiring tasks. The company needs to ask itself if it can handle the increased workload of hiring a large amount of employees in a specific time frame. It is important for the company to consider all of the steps in the hiring process. The first step is active sourcing and screening, which is manually going through its applicant tracking system, job boards, and social networks to find potential applicants. Then the company must screen every applicant to ensure that they have the skills, education, and experience that the company is looking for. These two steps alone can often be overwhelming for a company that is looking to hire a lot of qualified candidates in a specific time frame.

This is where an RPO can help relieve the stress of mass hiring from a company. A company can choose to have an RPO do some of the hiring tasks, called RPO On-Demand, or have the RPO take over the whole hiring process, called Enterprise RPO.  For example, a major home improvement store company hired Hire Velocity to do diversity sourcing and screening. Hire Velocity used its resources, including over 200 job boards and 5,000 content partners, to source potential candidates using the needs and wants of the company.  Hire Velocity then telephone-screened each potential candidate to make sure his or her skills, education, and experience met the needs of the home improvement store company. This process led to 49 bi-lingual store managers and human resources managers being hired.

Recruitment Process Outsourcing can be a great tool for a company to take the stress out of hiring and reduce costs by up to 50%. However, it is up to the company to evaluate its needs and resources to see if it would be beneficial to hire an RPO or do the hiring internally. With an RPO, every task is managed for the company and all tools are supplied.  With a contract recruiter, the overall work must still be managed internally as well as all tools needed to do the job.  If you’re looking to do volume hiring quickly in an efficient and cost effective manner, the RPO may be just the solution to your current hiring challenges!

U.S. employers in April added 290,000 new hires, more than Wall Street expected and the largest gain since March 2006, according to a recent WSJ article. The unemployment rate rose to 9.9%, a sign that more Americans are looking for jobs.

At the end of April 2010, the major job aggregation sites released hiring data and analysis, indicating slow but measurable growth. Below is a summary job report from Indeed.com, SimplyHired.com, and Execunet.com.

The slow job growth demonstrates some early signs of a recovery. However, job growth was inconsistent, effecting some cities, industries and job functions more than others. Indeed.com publishes a monthly report of where the jobs are, giving insights into which job market is strongest and which is weakest. Indeed’s job market survey shows slightly stronger job advertising activity, demonstrating slow growth.

Indeed’s April 2010 survey of job advertisements show the job market is strongest in Washington DC and San Jose CA.  Washington has been at the top of the list for a while, as Federal government spending has been high. However, San Jose CA improved in April to sharing a 1:1 ratio of unemployed per job advertisements. The top 10 job markets are geographically spread throughout the US (with the exception of the Southeast US). Baltimore, NYC, Salt Lake City UT, Oklahoma City OK, Hartford CT, Boston MA are all at 1:2 ratio of unemployed to job advertisements. Seattle WA & Austin TX, both at 1:3, round out the 10 best job markets.

At the opposite end of the spectrum is Detroit MI (#48, 1:7), Los Angeles CA (#49, 1:8), and Miami FL (#50, 1:9). Florida has the unfortunate distinction of having 4 of the worst 10 job markets – Tampa (#40, 1:5), Orlando (#42, 1:5), Jacksonville (#44, 1:6) and Miami (#50, 1:9). California has 3 of the worst 10 job markets – Sacramento (#46, 1:6), Riverside (#47, 1:7), and Los Angeles (#49, 1:8).

It’s interesting to note that these ratios have been slowly improving month over month through 2010. This indicates that there is some job growth, but it’s growing at a very slow pace.

Instead, find a recruiting partner that can build relationships with prospective applicants and passive candidates in order to streamline the hiring process. The University of Illinois at Chicago did a study on proactive recruiting particularly pertaining to finding qualified female candidates. In two different job searches for the same position, proactive recruiting nearly doubled the number of qualified applicants and showed a huge increase in the number of female applicants. Proactive recruiting was defined as an aggressive search for talent rather than a simple job post.

In recent years, Technology has eased the pains of creating an effective proactive recruiting process. Applicant tracking systems such as Silk Road’s Open Hire, iCims, and Taleo, (for example) have enabled companies to build robust talent pools and ease the process of finding qualified passive candidates. Leveraging the right technologies can create the infrastructure and foundation needed to lower your recruiting costs and enhance your recruiting process. Thus, it’s essential to look past the “reactive” recruiting methods such as job postings, and create a proactive recruiting process that will build a much more qualified talent pool.

Finally, remember that it is always a good practice to continuously promote your brand from a recruiting perspective.   Your career site is the door to your company and should display the goals, values and culture of your company.  Once you do proactively get the candidate to your front door, make sure you leave a great impression!

Valeri Marks
CEO
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The past few years have been hard on the recruiting industry, especially in the technology industry. With companies like Microsoft and Intel having mass layoffs last year, the industry seemed to get hit hard by the recession. However, many tech companies began a hiring spree late last year and continue to be actively hiring. ISI Group, a research firm, says that they believe overall revenues will rise more than 10% for the first quarter for many large tech companies. That is a major improvement when looking at a 16% decline just last year.

Take a look at Intel, a company that laid off 79,800 employees at the end of 2009. The popular computer chip maker said that it plans to hire 1,000 to 2,000 people in 2010, the first substantial hiring spree for the company in five years. Google, the world’s leading search engine company, said that it hired 786 new employees in the first quarter and that it expects to continue hiring.

The hiring spree in the technology industry is not just affecting the big players, smaller startups are also beginning to hire. LinkedIn, the social networking website for professionals, hired 184 people last year and 154 so far this year to bring its employee count to about 500. The company said it also plans to add an additional 300 hires this year. Another social media startup, Twitter, said it hired about 125 employees since last May, which brings the company to a total of 170 employees.

Source: Wall Street Journal

Most American companies view recruiting diversity as a burden for business, unrelated to the idea of having diversity in the workplace but rather the hassle associated with finding diversity candidates. It’s no secret that diversity recruiting is not a common result of the standard recruiting process. Many companies find that diversity candidates are not resembled in the majority of resumes on Monster, Careerbuilder, and other large job sites. However, there are overwhelming benefits to integrating a diversity of cultures in the office. Several companies have found first hand that the diversity of culture has led to several new ideas that have increased efficiency or led to new products.

Take the Frito Lay organization for example, their desire to recruit diverse candidates led to their product Doritos. Increasing diversity in the workplace will also increase creativity. Not all problems can be answered with one solution; other cultures can bring new ideas, which a homogeneous culture might not stimulate. Therefore, diverse recruiting strategies will bring benefits to the workplace, which are always worth pursuing.

Additionally, in an examination of common western culture in comparison to eastern culture, one noticeable difference is the view of relationship management. Eastern cultures rely on strong relationships between whom they work with. As a result, many customers of companies in the Far East have strong relationships with those they work with. Recruiting diversity more specifically from Asian countries can create stronger relationships with customers and strengthen the ties between those you work with. One downside to diversity in the workplace can be barriers in communication, however those barriers subside over time leaving the benefits of recruiting diversity.

Byron West
President
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As we look forward to emerging out of this recession and reducing unemployment, a new and highly anticipated generation of employees is moving into the workforce. There seems to be a lot of skepticism about how effective the “me” generation will be. Growing up in a culture centered on instant gratification and focused on efficiency, this new generation of the workforce will bring a new set of cards to the table.  No longer is the time dedicated to a job, a justified means to being promoted. Generation Y will now see their performance as the most justified reason for upward mobility in the company. In addition 35% of Generation Y employees wish to communicate with their boss several times a day. What is to be expected from these new employees should be clear, obtainable, and concise. Focused on efficiency, the more communication will be essential in obtaining the optimal performance from new workers.

In addition, Generation Y, or the “me” generation, seeks to obtain the security and status their parents obtained much earlier in life.  In a recent survey Generation Y respondents ranked “working with a manager I can respect and learn from” as an 8.74 on a 10 point scale. With most new employee’s eyes set on upward mobility, the ability to gain wisdom from their managers is becoming ever more crucial. Skepticism about this new workforce has led Generation Y to be referred to in a negative connotation. However, I believe that the new mold of employees can bring new effectiveness to companies through their aptitude with technology and ambition to jump through the necessary hoops to achieve success. Most of Generation Y has grown up with computers and has become extremely proficient at navigating the Internet. Their awareness with new developing technologies will bring technology options that may have gone unnoticed. Nevertheless, with the new employees coming into the workforce, I think we can all anticipate what Generation Y will bring to the table.

Resources:

Questions and Answers about GENERATION X/‌GENERATION Y. www.bc.edu/‌wfnetwork. Sloan Work & Family Research Network, n.d. Web. 18 Feb. 2010. <wfnetwork.bc.edu/‌pdfs/‌GXGY.pdf>.

Byron West
President
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While Salesforce is not an applicant tracking system, by utilizing its extensive database of applications, Salesforce can be equally as valuable as a Candidate Relationship Management tool. The PowerDialer application uses a powerful telephony tool, changing the way you reach out to candidates. For high-volume recruiting environments, the application can increase call efficiency by up to 400% through automatic updates of activities, automatic pre-recorded voicemail tool, and their powerful auto-dialer feature.  Other applications such as Jobscience allow recruiters to distribute job openings and manage resumes all within the Salesforce platform.

Organization is fundamental in recruiting and that is where the Customer Relationship Management aspect of Salesforce comes in. By embracing Salesforce’s activity and task management features, recruiters can create a more organized and efficient workflow while keeping up a fast pace.

The true value of accurate candidate tracking truly adds to a more pleasant candidate experience. Qualified candidates are more likely to apply to a requisition after speaking to a recruiter that is familiar with them and any previous conversations they may have had.

Byron West
President
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Mayclim, Troy. “Top Of Employment Market Stabilizing .” www.execunet.com. N.p., n.d. Web. 29 Oct. 2009. .

Byron West
President
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