Mgmt 383
Chapter 7
Recruiting In Labor Markets
Spring 2009
Recruiting
• The process of generating a
pool of qualified applicants
for organizational jobs
Strategic Approach to Recruiting
• Knowing the number of personnel the
organization will need.
• The result of the HR Plan.
• Staffing Tables
• HR Audits (Manpower Budgets)
• Envelope Forecasts
• Recruiting is only as effective as the HR
Plan is accurate.
Strategic Approach to
Recruiting
• HR Strategic Recruiting Responsibilities:
• Knowing the number of personnel the
organization will need.
• Identifying relevant labor markets.
• Determining whether to hire personnel or use
flexible staffing (level of outsourcing).
• Level of internal v. external recruiting.
• Identifying critical or essential skills.
Strategic Approach to
Recruiting
• Consider legal ramifications of recruiting.
• Addressing affirmative action requirements.
• Determining the techniques most appropriate
for advertising position vacancies.
• Evaluating the effectiveness of recruiting
efforts.
Strategic Recruiting Stages
HRP
Assignment of
Organizational
Responsibilities
Strategic
Recruiting
Decisions
Recruiting
Method
Selection
Assignment of Organizational
Responsibilities
• HR Staff
Responsibilities
• Forecast recruiting needs.
• Recruiting ads &
campaigns.
• Plans & conducts
recruiting efforts.
• Audits & evaluates all
recruiting activities
• Operating Mgrs’
Responsibilities
• Anticipate vacancies.
• Determine applicant KSA.
• Assist recruiting effort w/
information about job
requirements.
• Provide feedback on
success/failure of
recruiting activities.
Three Categorizations of Labor
Markets
• Labor Force Population
• Applicant Population
• Applicant Pool
Labor Force Population
• Labor Force Population - all the individuals
who are available for selection if all possible
recruitment strategies are used.
•
•
•
•
•
Media (Newspaper Ads,Television & Radio)
Labor Unions
Professional Organizations
Job Fairs
College Recruiting
Applicant Population
• Applicant Population - that portion of the
labor force population that is available for
recruitment using a specific recruiting
approach.
• Applicant Population size is affected by:
• Recruiting Method
• Recruiting Message
• Applicant Qualifications Required
• Administrative Procedures
Applicant Pool
• Applicant Pool - that portion of the
applicant population that actually applies
and is evaluated for the position.
Identifying Labor Market
Components
Labor Force Population
Applicant Population
Applicant Pool
Selection
Specific Labor Market
Classifications
• Geographic labor markets
• Global labor markets
• Industry/occupational labor markets
• Construction
• Manufacturing
• Retail trade
• Educational/technical labor markets
• Specific degrees (BBA, BME, BEE)
• Specific certification (CPA, PHR, GM certified mechanic)
• Specific fields (IT, RNs, etc.)
EEO Ramifications of
Recruiting
• Disparate impact.
• Eligibility for government contracts
or subcontracts.
• ADA/Rehabilitation Act
accommodations
Strategic Recruiting Decisions
• Organizational-Based Recruiting v.
Outsourced Recruiting.
• Regular v. Flexible Staffing
• Recruiting Sources: Internal v. External
• Diversity/AA Considerations
Organizational-Based Recruiting
v. Outsourced Recruiting
• Do our own (organizational-based [a.k.a.,
traditional]) or contract it (outsourced).
• Examples of Outsourced recruiting
• Private employment agencies
• Public employment agencies
• Professional Employer Organizations (PEOs)
and employee leasing.
Recruiting Presence and Image
• Continuous recruiting (college recruiting,
e.g.) v. intensive recruiting (ad hoc).
• Recruiting efforts may have a positive or
negative impact on image.
• Recruiting staff represents firm to outside
world.
• Can be tied to marketing efforts (Southwest
Airlines as on of top 100 Best Companies to
Work For, e.g.).
Regular v. Flexible Staffing
• Regular Staffing - hiring traditional
permanent employees to perform the jobs in
question.
• Flexible Staffing – use of nontraditional
employees.
• Temporary employees – fulltime employees
who work for less than 90 days. Hired for short
term shortages.
• Independent contractors
Regular v. Flexible Staffing
• Considerations in deciding whether to hire
personnel or use flexible staffing.
• Hiring permanent employees.
• Better control
• Benefit costs are usually higher
• Hiring “nontraditional employees” (outsource).
• Cheaper
• Loss of control
Advantages of Internal
Recruiting
•
•
•
•
•
•
Enhances employee morale.
Better assessment of candidate’s abilities
Lower cost for some jobs.
A motivator for good performance.
Causes a succession of promotions.
Firm has to hire externally only at the entry
level.
Disadvantages of Internal
Recruiting:
• Inbreeding
• Political infighting
• Adverse reaction of those not
promoted
• Increased need for management
development programs
Ripple Effect/Movement
Analysis
(1)
(2)
(3) + (4) + (5) = (6)
(7)
Level Positions Increase RetireTermin- Primary Vacancies resulting
beginning (decrease) ments
ations Positions from promotions
FY 2003
in staff
to be
retirements, etc.
filled
on lower levels
_______________________________________________(I) (II) (III) (IV)
I
10
--
3
II
20
4
5
2
11
III
40
8
5
8
21
80
150
12
24
10
23
10
22
32
69
IV
Total
2
5
(8)
Total
Positions
to be
filled
FY2004
Ripple Effect/Movement
Analysis
(1)
Level
(2)
(3) + (4) + (5) =
Positions Increase Retire- Terminbeginning (decrease) ments ations
FY 2003 in staff
(6)
(7)
(8)
Primary Vacancies resulting Total
Positions from promotions
Positions
to be
retirements, etc.
to be
filled
on lower levels
filled
_____________________________________________________ (I) (II) (III) (IV) FY2004
I
10
--
3
2
5
-- --
--
--
5
II
20
4
5
2
11
5 --
--
--
16
III
40
8
5
8
21
5 11 --
--
37
80
150
12
24
10
23
10
22
32
69
5 11 21
15 22 21
--
69
127
IV
Total
Internal Recruiting Sources
• Job Posting/Job Bidding Systems
• Post before external recruiting.
• Notifies current employees of all vacancies for
which they may be qualified.
• Promotions & Transfers
• Dependent on quality of organizational
development programs.
• Must ensure that internal candidate has requisite
skills.
Employee Focused Recruiting
• Current employee referrals
• Recruiting former employees
• Retired employees.
• Female employees whose school age
children permit her to return to full time
work.
• Luring back former employees from other
employers.
Advantages of External
Recruiting
• New perspectives, enhanced creativity from
“new blood.”
• Instant qualifications (faster than training).
• Provides new industry (as opposed to firm)
insights.
• Does not create internal political problems
as new hire has no group of “political
supporters” in the organization.
Disadvantages of External
Recruiting
• Candidate may not “fit’ the organization.
• Causes morale problems when internal
candidates are not selected.
• Longer orientation time is required.
• Difficult to assess external candidates.
External Recruiting Sources
• College Recruiting (Placement Office)
• Expensive and time consuming
• Criteria for selecting colleges:
• Reputation of the College (MIT v. NWCC)
• Market competition
• Past experience with graduates
• School Recruiting
• Career days.
• Good relations may encourage specialized programs
to meet your needs
External Recruiting Sources
• Labor Unions
• Primarily for skilled trades.
• Used a good deal in the construction
industry
• Downside, less flexibility then nonunion
labor because of CBAs.
External Recruiting Sources
• Employment Agencies
• Public
• Private
• Executive Search Firms
• A.k.a. “head-hunters.”
• Retainer fee system - your firm is charged
regardless of the outcome of the search.
• Contingency fee system - your company is only
charged if the search is successful.
• Fees are usually high (usually 33.3% of the first
annual salary).
External Recruiting Sources
• Competitive Sources
• Professional associations (AOM, AMA, etc.)
• Placement websites.
• Placement tables at conventions.
• Trade associations
• American Production and Inventory Control Society
(APICS)
• National Association of Chain Drug Stores
• Competitors
• Customer (Home Depot, Lowes, Best Buy)
External Recruiting Sources
• Media Sources
• Media:
• Newspapers
• Magazines
• television
• Radio
• Billboards (Roman Catholic Church
priest story)
E-Recruiting Sources
• External Computerized Databases
• Electronic compilation of resumes and
application forms.
• Internet job boards
• Monster.com
• HotJobs
• Profession/career websites
• Shrm.org
• National Society of Professional Engineers (NSPE)
E-Recruiting Sources
• Employer websites
• Sites provide vacancies and online
applications.
• Programs can sort through resumes and
application forms to identify qualified
candidates and match them to specific
openings.
Advantages of E-Recruiting
• Wider exposure of position announcements
(reaches a broader audience).
• Casts a wider geographic net (even
globally).
• Permits targeting specific audiences.
• Increases applicant pool.
• Reduces response time (better than snail
mail).
Disadvantages of E-Recruiting
• Draws more unqualified applicants
(increases screening efforts).
• False responses (browsing, not buying).
• Qualified applicants without internet access
are excluded (possible disparate impact).
• Privacy concerns in light of EEO and credit
reporting laws.
Legal Issues in Internet Recruiting
• Are rejections resulting from screening
software really based on the job
qualifications?
• Are protected classes being excluded?
• How can applicant flow data be collected
for EEO-1?
• Who is a real applicant and who is “just
looking”?
• The informality of on-line communications
may lead to improper information being
disclosed (TMI).
Affirmative Action
Requirements
• Accuracy of goals (could become
inflexible quotas).
• What activities could adversely affect
recruiting for goals:
• Word of mouth recruiting.
• Supervisor recommendations.
• Unrealistic KSAs.
Media Choice Considerations
•
•
•
•
•
What do we want to accomplish?
Who are we trying to reach?
What should the message convey?
How should the message be presented?
Which is the appropriate medium?
• Note: Media results should be tracked.
Techniques Appropriate for
Advertising
• Determining the techniques most
appropriate for advertising position
vacancies.
•
•
•
•
•
•
Employee Referrals.
Media (Newspaper Ads,Television & Radio).
Labor Unions.
Professional Organizations.
Job Fairs.
College Recruiting.
Trigger Words to Avoid
• “Trigger words” to avoid in
advertising:
• Help wanted male (or female).
• Must be young & energetic.
• Patrolman.
• Metermaid.
• Junior executive.
Evaluating the Effectiveness of
Recruiting
• Possible criteria:
• Quantity of applicants
• Quality of applicants
• Time required to fill openings
• Affirmative action goals are met
• Cost per applicant
Recruiting Expenses .
Number of recruits hired
Evaluating Recruiting Costs
• Direct Costs
• Advertising
• Recruiter’s salaries
• Travel expenses
• Agency fees
• Telephone expenses
• Indirect Costs
• The time managers spend in interviews
• Corporate image
Evaluating Recruiting Benefits
• Benefits
• Reduced time from contact to hire.
• Increased pool of qualified applicants to
select from.
• Improved proportion of acceptance to
initial offers.
Evaluating the Effectiveness of
Recruiting
• Yield ratio - a comparison of the number of
applicants at one stage of the recruiting
process to the number at the next stage.
• Selection rate - the percentage of personnel
hired from a given group.
• Acceptance rate - the number of applicants
hired divided by the number of applicants
offered jobs.
Evaluating the Effectiveness of
Recruiting
• Success rate - the comparison the number of
applicants hired who became successful
employees against the number of who did not.