Greg Priest
Management Services Committee Member
Priest Electric

Tight labor market, the Great Resignation, record-low unemployment or whatever you call it, finding and hiring good people is getting progressively more difficult. It is estimated that 65 percent of jobs posted online are found and filled by job services. These are the types of services that want you to obtain permission to use their name and their data. But what does a company do when job services consistently fail them?

My company has found success with referrals. Some companies may have a human resource professional and may have a formal employee referral program tied to incentives and tracking while others may rely on articles, classes and ongoing education to navigate the recruitment and hiring process. The principles are the same for businesses of every size. The process is quite simple. Someone in your organization needs to open their mouth and ask, “Who do you know that’s a great mechanic (insert job here) that may be open to working for this company?”

My last two hires who have worked out are referrals. We have gone through four other employees the job service brought us, and they all lasted less than six months. I even had one of my customers poach one of my employees while they were playing with their dogs in a dog park. My customer approached my employee and asked, “Do you know who could help us with water pump knowledge?” The result was my customer successfully recruited my employee with a simple question. However, that employee ultimately returned to work for us after he discovered the customer’s job schedule wasn’t what he expected. The experience got me thinking, “Maybe I ought to consider recruiting employees at the dog park?”

Discussing the hiring process is a very organic conversation with the people you already know or are in your established social circles because it’s inevitable that those who know you will ask about work. You oftentimes hear things like, “How’s business?” or “What do you do for work?” Of course, it is easy to ask follow-up questions during these organic conversations like, “Business is up. Do you know any great sales managers?” or “I have a great opportunity for a sales manager.”

There are many ways to structure a referral program, and you can incentivize in ways that best meet your needs and the needs of your employees. Over the years, I have found there are some benefits and drawbacks to employee referrals.

Benefits to employee referrals

• Employees know the job and culture.
• Easier to reach candidates who may not be actively looking for a job.
• Your employee has buy-in and feels valued that they participated in the process.
• New hires have an instant social connection and friend.
• Employees tend to work better together and appreciate each other because of the referral.
• You save money by not having to pay for recruitment and advertising.

Potential drawbacks to employee referrals

• Social connection can also be a negative as it can be difficult to manage friends.
• Incentives will cost you money but probably less than recruiting costs.
• Nepotism, or clique cultures.
• Can be less diverse, same social leanings, and fewer fresh ideas.
• Pay close attention to qualifications because referrals may be less qualified than those who come to you by way of recruiting and advertising.

And lastly, it’s always a good idea to keep hiring best practices in mind. Even if a candidate is a good referral, make sure that you treat them the same as other candidates and that they go through the same hiring process as any candidate.

Quick list of hiring best practices

• 
  Write strong job descriptions. (A great resource to pull from is Job Descriptions for EASA Service Centers, which is available for purchase on go.easa.com/egc.)
• Communicate benefits/salary/time off clearly and honestly.
• Let candidates know a typical career path and opportunities involving the company’s mission and vision.
• Always check references and job history, and let the applicant know you will be doing so.
• Use a background check company, and let the applicant know you will be doing so.
• Use a skills assessment.
• Interview with a team of two or three people in the room and discuss your findings together.
• Pre-employment drug screening (insurance usually requires this).
• Move quickly in this market.

Categories: Miscellaneous

Tags: Human resources Employees Hiring

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