Why Employee Referrals can work wonders for any sector?

  • Added:
    Jun 26, 2014
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Why Employee Referrals can work wonders for any sector? Photo by Savio Vadakkan

The war for talent remains a potent issue for most companies across industry verticals. Most recruiters are struggling with increased attrition rates & thereafter the training costs involved after the new recruitment. The fact that there is a limited talent pool doesn’t make the situation any easier.

It is no surprise then that Employee Referral Programs have become a favorite with recruiters across sectors. The prevalence of the program may only be higher in knowledge-based industries where quality manpower is the greatest asset.

With most industries reeling under high cost of recruitment, Employee Referral Programs come in as a key enabler in recruiting quality candidates while keeping the recruitment costs under check. With employees typically being paid their incentives once the referred candidates complete 3-6 months of continuous service, the ROI on the pay out is extremely high. Added to this, is the fact that the candidate being referred to from an authentic source also reduces the need of elaborate background checks saving time & money. Typically there is a very high ratio of offer acceptance in case of referred employees, which ensures that all the effort put in, does not come to naught.

The fact that Employee Referral Programs allow recruiters to reach those elusive “Passive Candidates” is also a great boon. They can now stop competing for the same talent pool with other competitor organizations.

The reason that employees recruited through Employee Referrals work best across sectors is also that the referred candidate is more likely to have a good fit with the organizational culture. This is a priceless proposition for most recruiters as it not only reduces the time-to-productivity for candidates but also leads to higher retention rates for valued employees. In fact as per The Seattle Post-Intelligencer report employees that come from referrals, are able to provide 25 percent more profit, while they are 20 percent less likely to quit once in the position. Which industry would not like to reap these advantages?


No discussion on Employee Referral Programs will be complete without mentioning the fact that they are implementable across geographical boundaries. While most recruiting initiatives operate on a regional level, Employee Referral Programs have the distinction of accessing a global pool of talent and a highly adaptable workforce, which is able to work across cultures.

Research reveals that there is a positive correlation between referrals made by employees and their engagement levels. So irrespective of the industry you are in, if you are not receiving enough referrals, it is time to take a good, hard look not only at your Employee Referral Program but also your work culture.

Zalp is the only employee referral tool that gives employees seven easy and different ways to make a referral which drastically helps to increase employee participation.

Visit http://www.zalp.comto know more or drop a mail to info@zalp.com

Author's Profile

Savio Vadakkan is the Marketing Representative at ZALP -The No.1 Employee Referral Tool used by industry leading organizations. ZALP enables organizations to build a completely automated and social media integrated employee referral program to help boost their employee referral hires. Visit http://www.zalp.com to know more

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