Recruiting methods FAQ: A guide to terms and strategies

Effective recruiting translates to great employees who help your company succeed. To guide you to set up or revamp your hiring process, we answer frequently asked questions on basic and advanced recruiting terms, methods and strategies:

Basic terms and methods

• What is the “recruitment cycle”?
• What is “full-cycle recruiting”?
• What is “e-recruitment”?
• What are the steps of the e-recruitment process?
• What is the difference between recruitment and selection?
• What are recruiting metrics?
• What recruiting metrics should we track?
• When does the recruiting process begin?
• What are the steps of the recruitment process?
• Why is recruitment so important for new companies?
• What are the common types of recruiting challenges that organizations face?
• What is the role of the hiring manager?
• What are some common methods for Generation Y recruitment?

External recruiting

• What is a “headhunter”?
• How do recruitment agencies work?
• Why should we use a recruitment agency?
• What are some recruiting tools to make my process more efficient?
• What is a Virtual Recruiter?
• What are the pros and cons of using a virtual recruiter?

Recruiting budget

• What should be included in my recruiting budget?
• How can I calculate my recruiting budget?
• How can I build a case for a higher recruiting budget?

Basic terms and methods

What is the “recruitment cycle”?

The recruitment cycle represents the entire recruitment process. This cycle usually starts with job posting and ends with extending job offers or onboarding new hires. Here’s an image of a basic recruitment cycle:

More complex recruitment cycle graphics may include intricate recruiting tasks, like providing interview feedback, conducting background checks and negotiating job offers.

What is “full-cycle recruiting”?

When recruiters do “full-cycle recruiting,” they manage the entire recruitment process from posting job ads and sourcing to interviewing and closing candidates. These “full-cycle recruiters” are trained to perform every recruiting and administrative task throughout recruitment cycles.

For more information on steps within full-cycle recruiting, read our FAQ guides on sourcing, interviewing and hiring processes.

What is “e-recruitment”?

E-recruitment, or online recruitment, refers to using the web, software and other technology to attract, find, evaluate and hire people. Online recruiting methods include:

• Sourcing candidates on professional social media.
• Using an applicant tracking system (ATS.)
• Interviewing candidates online via video interviewing software.

These methods are alternatives to offline recruitment, like posting jobs in newspapers, attending career fairs and collecting resumes through candidate walk-ins.

Most companies combine offline and online recruitment techniques. Technology makes your processes more efficient and helps you reach candidates anywhere. Using offline recruiting channels (e.g. career fairs) allow candidates to connect with you and your company on a more personal level.

What are the steps of the e-recruitment process?

E-recruitment includes all steps of your standard recruitment process that involve the use of web-based technology. Here are some important e-recruitment steps:

• Post job ads on online job boards.
• Seek employee referrals through your Applicant Tracking System (ATS.)
• Source candidates on professional social media or portfolio sites.
• Administer online pre-employment tests.
• Interview candidates using video interviewing software.
• Conduct background checks through a provider that your ATS integrates with.

What is the difference between recruitment and selection?

The words “recruitment” and “selection” describe two distinct phases of your hiring process. Recruitment refers to attracting, finding and engaging candidates. Selection refers to evaluating candidates and ultimately hiring the best among them.

The phrase “recruitment and selection” is used to describe the entire hiring process. Often, the word “recruitment” appears as a general term and includes “selection.”

What are recruiting metrics?

Recruiting KPIs (or metrics) measure how effective and efficient your recruitment process is. Some metrics are expressed as percentages or ratios (e.g. yield ratios), while others are absolute values that you can compare to industry or company standards (e.g. time to hire.) Use them to discover how well your recruitment process works and identify where to improve.

What recruiting metrics should we track?

There are many available metrics. Usually, companies choose to track the following metrics:

• Quality of hire
• Cost per hire
• Time to fill
• Source of hire
• Offer acceptance rate

If you want to dig deeper, add metrics like application completion rate, new hire turnover or hiring manager’s satisfaction with their new hires and hiring process. Choose metrics based on your company’s individual needs.

Gain a deeper understanding of your hiring process and its bottlenecks with Workable’s detailed reports and analytics. Try Workable for free today.

When does the recruiting process begin?

The starting point of your recruitment process can be when:

• Hiring managers identify a need to hire new team members.
• HR or finance approves a job opening.
• Recruiters and hiring managers discuss position requirements.
• Recruiters post a job ad and start receiving applications.

It’d be a good idea to define when recruitment starts at your company with a recruitment policy.

What are the steps of the recruitment process?

The typical steps of a recruitment process vary depending on the role and company. But, most hiring teams will likely go through these steps:

1. Identify the need for a new job.
2. Decide whether to hire externally or internally.
3. Review the position’s duties and requirements and write a job ad to post online.
4. Get approval to advertise the job.
5. Solicit referrals from employees.
6. Select appropriate sources (external or internal) to post job openings.
7. Decide on hiring stages and possible timeframes.
8. Review resumes in company database/ATS.
9. Source passive candidates.
10. Shortlist applicants.
11. Screen and interview candidates.
12. Run background checks and check references.
13. Select the most suitable candidate.
14. Make an official offer.

Each step might have several sub-steps. For example, step 10, which addresses screening and interviewing candidates, may involve pre-employment testing, work samples and multiple interviews.

Why is recruitment so important for new companies?

It’s often said that people are your company’s greatest assets. New companies depend on their people even more than established companies. Here are two reasons why:

• They rely on each employee’s decisions and behavior. New companies haven’t yet developed their business processes enough and depend on their employees’ innovativeness, competence and better judgement to succeed.
• They need to hire for future growth. New companies aim to grow rapidly in terms of revenue, reputation and market share. This means that they have to hire people who will help them scale.

Recruiting is the process that brings the right people on board. Effective recruiting strengthens your company and results in higher growth and productivity. On the flip side, ineffective recruiting can cost an average of $17,000 per one bad hire which new companies can’t afford easily. These companies may also find it difficult to address damages in reputation and employer branding.

See also: What is employer branding?

So, it’s important for companies to choose the right recruitment methods and invest in efficient and effective hiring processes. And, cultivating engagement to retain employees is the next important step.

What are the common types of recruiting challenges that organizations face?

Organizations face multiple recruitment challenges. Here are some that arise often:

• The need to hire quickly. Most companies want to fill their job openings fast, but often face shortages of qualified candidates. This may cause hiring teams to wait longer than necessary for good candidates to enter the pipeline until it becomes imperative to hire someone. This “panic hiring” may often result in bad hires and high costs for companies.

Tip: Posting job ads and waiting for candidates to apply may not always be the fastest approach. Consider proactively sourcing passive candidates through social media or sourcing tools like People Search.

• The need to reduce recruiting costs. Recruiting costs include all costs associated with attracting, communicating and evaluating candidates, as well as costs of internal processes and recruiter salaries. These costs may put a strain on company budgets, especially when it comes to startups and small businesses.

Tip: Track all recruitment costs, from premium job board fees to interviewing costs. Discover which recruitment techniques and sources work for you and invest in them. Consider cost-effective recruitment methods, like referral programs and free job board posting.

• The need to make data-driven decisions. Companies can use recruitment data and metrics to constantly improve their recruiting and make more informed decisions. Hiring teams need ways to compile and organize data in an efficient and streamlined way.

Tip: Invest in an applicant tracking system (ATS) that has the reporting capabilities you need. If you already have an ATS, ask your account manager to show you how to manage data from your recruitment process.

• The need to build a strong employer brand. Your company’s employer brand depends on many factors: from candidate experience to your investment in employee development. It’s challenging to create and enhance your employer brand, but it can result in higher-quality candidates and greater employee retention.

Tip: Create recruitment processes that put candidates first. Use social media and your careers site to showcase your culture, benefits and employee stories. Also, it’s a good idea to monitor feedback on sites like Glassdoor and respond to reviews.

• The need to recruit diverse candidates. Diversity benefits your workplace, but many companies struggle to attract and hire diverse candidates. Unconscious biases and stereotypes are often the reason for this issue.

Tip: Consider creating a blind hiring program. Your ATS might have the option of obscuring candidates’ photos and names. Shift to more effective hiring methods, like structured interviews, and invest in training to help interviewers combat their biases.

What is the role of the hiring manager?

Hiring managers identify the need to hire new team members. They run their team’s recruitment process and lead recruiters, sourcers and other employees who make up their hiring team. Hiring managers:

• Identify the need for new hires and gain approval for new job openings.
• Write job descriptions and craft interview questions.
• Decide who has passed a pre-employment assignment and who will get a second interview.
• Extend a job offer to the best candidate.

In general, hiring managers are in charge of hiring processes. Recruiters are hiring managers’ trusted consultants who help them make informed decisions.

Workable’s applicant tracking system makes it easy to involve hiring managers and set up hiring teams. Improve your team collaboration by trying Workable for free today.

What are some common methods for Generation Y recruitment?

Generation Y, or millennials, is the generation of people born during the 1980s and early 1990s. This generation switches jobs frequently because they don’t like staying static. To recruit millennials, consider these methods:

• Focus more on potential and less on years of experience. Often, companies ask for candidates who have “X years of experience” in a job. Millennials might not meet this requirement due to their job-hopping, but they may still make valuable employees. Ask for transferable, job-related skills, instead of experience.
• Build a strong employer brand online. Millennials are more likely than older generations to use social media to research companies. Aim for positive candidate experience and strengthen your presence on social media (e.g. with photos of life at your company and employee activities.) To reach a wider audience, use multiple social platforms; from Facebook and Twitter which have audiences of all ages, to niche platforms like Instagram and Snapchat, where millennials are more active.
• Invest in referrals. Encourage your employees to refer candidates for positions in your company. Ask your millennial employees to dig into their networks and refer friends, previous colleagues or fellow students. Create an effective referral program to encourage referrals.
• Advertise your perks. Apart from competitive salaries, many millennials value perks like flexible hours and development opportunities. To attract millennials, promote your policies and training and development initiatives on social media and your careers page.

External recruiting

What is a “headhunter”?

Headhunters search for talented people who meet hiring managers’ requirements. Headhunters are mostly responsible for locating candidates, online or offline, and engaging them. Here are some headhunter responsibilities:

• Coordinate with hiring managers to define necessary requirements for open roles.
• Send recruiting emails to passive candidates.
• Join social media groups and professional networks to interact with potential candidates.

Headhunters are usually independent recruiters, but they may also be employed by recruitment agencies. Some Headhunters specialize in recruiting for specific industries or roles.

How do recruitment agencies work?

Recruitment agencies help companies in the initial stages of their recruitment process (e.g. sourcing and shortlisting.) Companies may pay them in two ways:

• Contingency fee. This form of payment means that you only have to pay if you hire candidates your agency recommended. You simply provide your requirements and let the agency find people who seem to be a good fit. Because you pay nothing upfront, this option is low risk. You can usually work with multiple contingency recruiters too.
• Retained fee. This payment option means that you pay your agency an upfront fee. Usually, you will want to give this agency sole responsibility to fill your job opening so they won’t compete with your internal team or other agencies. Retained agencies may offer you information about the job market and present you with diverse recruiting methods and candidates.

Each recruitment agency might have its own terms. Before you sign an agency’s contract, spend some time with the recruiters you will be working with and ask them to present their processes and recruiting methods.

Why should we use a recruitment agency?

Recruiting agencies help make your hiring more efficient by undertaking the initial phases of your hiring process (including resume screening, phone screens and first interviews.) Recruitment agencies are especially useful when you need:

• To meet short-term hiring needs. A recruiting firm finds employees fast, since they have a network of candidates with whom they have built relationships. Staffing firms, which hire candidates as employees and then assign them to clients on a temporary basis, may be useful in this case.
• To enhance your pipeline for a role. A recruiting agency helps you fill your pipeline with qualified candidates, allowing hiring managers to make more informed decisions. You could also hire a recruitment consultant from an agency to help you attract and build long-term relationships with passive candidates.
• To hire for a specialized or executive role. If your internal recruiters have never hired for specialized roles before, they may have to dedicate a lot of time to learn how. Recruiting agencies bring in knowledge of specialized skills, niche job boards and unique sourcing methods.

What are some recruiting tools to make my process more efficient?

Here are a few ways to increase your efficiency as a recruiter:

• Build checklists for standard processes. Checklists help you organize your hiring. Use them to prepare for interviews and screening calls to ensure you have all the information you need before speaking with candidates.
• Use email templates. Personalized emails are important, but you may not always know where to start. Modify templates to ask for referrals, invite candidates to interviews or send interview feedback.
• Invest in recruiting software. Video recruiting software (e.g. HireVue, Spark Hire) saves you time and money when you’re interviewing remote candidates. Applicant tracking systems can also help you manage your hiring stages, store candidate profiles in a searchable database and collaborate with your hiring team.

What is a Virtual Recruiter?

Virtual Recruiters (VRs) are recruiters who work mostly over the Internet and by phone. Their responsibilities are similar to those of office-based recruiters, but they get to choose their work location. Also, VRs are often contractors, rather than employees. Virtual Recruiters:

• Source candidates on social media, blogs, forums and other websites.
• Post jobs on online job boards.
• Conduct initial phone screens and interviews via phone, Skype or other online communication tool.
• Check candidate references.

Some VRs also use applicant tracking systems to create and manage their candidate databases.

What are the pros and cons of using a virtual recruiter?

There are both benefits and downsides in hiring Virtual Recruiters (VRs.) On the positive side:

• They save you money. Because VRs are usually contractors, you can save money on benefits and perks you would offer to employees. Also, VRs have extensive networks in place and can add value to your company fast.
• They may be more productive. Office-based employees may be extremely talented, but commutes and open office noises often take their toll on employees’ productivity. VRs work from wherever they feel comfortable and this can translate to greater productivity and higher job satisfaction.
• They help you find remote candidates effectively. VRs already do their work over online software, so they are trained in using virtual interviews and phone screenings to their advantage. VRs can find and interview remote candidates easily, thus expanding your candidate reach.
• They are more flexible. VRs can organize their time as they need to. For example, office-based recruiters, who have standard working hours and commutes, might face challenges in communicating with candidates in different time-zones. VRs can overcome these challenges more easily.

However, there are some downsides to hiring Virtual Recruiters:

• They may face communication issues. Communicating solely via email and phone can prove challenging. Recruiters can’t drop by a hiring manager’s office to ask a clarifying question and there might be delays when waiting for replies. These barriers can make collaboration difficult and time-to-hire longer.
• They may not fully grasp company culture. Companies may find it tricky to acquaint remote employees with their workplace. This means that VRs might not be able to present and explain your company’s culture to candidates in the most personable way, especially if VRs are contractors and not employees.
• They are hard to manage. If your VR is an employee and not a contractor, you’d have to find ways to monitor their progress and keep them motivated. This may be challenging. Companies may need to arrange frequent meetings and reports and invest in optimal equipment and connectivity for their remote employees.

Recruiting budget

What should be included in my recruiting budget?

First, consider how you usually allocate your recruiting budget. Creating a detailed list of possible recruiting costs will help you build an accurate spending plan. Here’s a list with common costs to include in a recruiting budget:

• Job boards fees: This represents what you pay job boards to display your job openings.
• Candidate assessment costs: These are fees for companies that offer pre-employment tests or coding challenges.
• External recruiter expenses: This is money spent to pay individual recruiters, recruiting agencies or staffing firms.
• Employer branding efforts: These are funds spent on events related to recruiting, like campus recruiting activities and careers fairs.
• Careers page costs: These expenses include the setup, maintenance and redesigning of your careers page.
• Internal recruiters’ costs: Often the highest recruiting line item, this includes recruiters’ salaries, benefits and travel expenses.

Add any other expenses also related to recruiting, like referral program bonuses, travel reimbursements for candidates and applicant tracking system (ATS) costs.

How can I calculate my recruiting budget?

You can calculate your recruiting budget in two ways:

• Use your average cost per hire. Calculate it by adding your actual recruiting expenses from last year and divide by the number of hires you made. Then, multiply your average cost per hire by the number of hires you plan to make this year.
• Add all projected internal and external costs. For example, imagine you plan to hire 50 people next year. If you decide that you need 50 job listings on three different job boards, you can multiply each job board’s fee by 50 and then add all three numbers to get the total projected cost of job boards (part of your external costs.) Also, if you plan to hire more recruiters within that year, add their salaries (part of your internal costs) in your budget.

How can I build a case for a higher recruiting budget?

If you believe that your company should invest more in recruitment, consider building your case around:

• Hiring volume. Chart your company’s hiring trends and calculate how much time you spend on each recruiting task. With this information, you can visualize whether your current team is able to shoulder the workload and make a case for budgeting new team members.
• Recruiting metrics. Data makes your case stronger. Track and present metrics, like quality of hire and source of hire. You could use them to make a case for a larger recruiting team, as well as investing more in effective sources and methods. For example, if referrals are your best candidate source, present data to prove it and follow up explaining the benefits of fully-fledged referral programs.
• Business issues. Be honest about what challenges you’re facing and how they affect your entire company’s business (directly or indirectly.) For example, you might perceive that hiring managers don’t have enough time to evaluate candidates properly, which may result in less qualified new hires than expected. Present possible solutions with data and timelines where you can. In our example, you might suggest that your company invest in pre-employment testing. Your presentation and ideas will help persuade senior management that you have a detailed plan to use a higher budget to your company’s benefit.
• Software. Your recruiting process may have inefficiencies. Look for software that could eliminate these issues and request demos or trials when possible. Once you collect enough information on each option, present how this software will benefit your company in the long run.