Why Creating an Employee Referral Program Will Bring You the Best Hires

Human Resources teams need a diverse set of tools in their toolbox when it comes to recruiting in today’s market. Networking, social media, branded ads, sponsored events and the like are all important, but one of the most effective tools savvy hiring teams have at their disposal is an employee referral program.  Data shows that referrals from current employees result in the best hires, with referred employees performing better and staying longer than employees sourced through traditional means.


The Undeniable Benefits of Employee Referrals

There are many benefits to implementing an employee referral program.  Some of the most compelling include:

  • Improved closing ratio – While employee referrals typically only account for 7% of applicants, they close 40% of the time, according to data provided by Jobvite.
  • Access to hard-to-find skills – When seeking out high-level or unique skill sets, the talent pool can often be limited. Employees have strong connections in their field and they know other professionals like themselves, allowing them to refer candidates who have both the skills and experience to thrive.
  • Better cultural alignment – Your employees know your culture inside and out. They would only refer someone who would thrive in that culture, as they would not want to damage their own relationship with their colleague.
  • Higher-quality candidates – Employees know what you’re looking for in a candidate, and because their own reputation is on the line, they will only take the time to make the connection if the person they wish to refer meets quality standards.
  • Improved efficiencies – Since referral programs generate fewer weak candidates, HR and management waste far less time on candidates who likely won’t be a good fit.
  • A full pipeline – Formal referral programs provide the organization with a steady flow of passive candidates, the “holy grail” of recruiting.
  • Better employee retention – Referred employees work longer at an organization than traditional hires, and report higher job satisfaction.

Referral programs not only inject life into your candidate sourcing and recruiting practices, they also improve morale among your workforce.  Most programs offer a monetary bonus for a successful referral. That bonus incentivizes employees for making strong recommendations, but it also provides employees with a tangible reward for “living their work” and acting as an ambassador for the organization. When they receive their bonus, they will feel valued and more engaged.


If you are looking for innovative ways to improve your hiring and retention processes, of if you are looking to staff your HR department with top talent who can make a difference in your organization, connect with the professional recruiters at Contemporary Staffing Solutions today. We can help you build your HR dream team this year.