Four ways to find IT talent— and the costs

Published on May 1, 2002
on TechRepublic.Com

As the economy eases its way out of a recession and technology departments again start to hire, recruiting experts and TechRepublic members offer this advice: Forget about the ROI of recruiting and focus on fixing weak recruiting methods.

"The cost [of hiring] is immaterial," explained Lou Adler, head of Tustin, CA-based POWER Hiring, a professional coaching business that advises individuals and corporations on how best to recruit staff.

"What would you pay for an A-quality candidate?" asked Adler. Adler believes that most companies wouldn't worry about the cost if they could get an A-quality candidate, because great employees help companies roll out new products more quickly and improve the morale of those they work around.

"People only worry about ROI related to hiring when they hire B- and C-quality people. So don't hire them," said Adler, who advises hiring managers not to compromise on hiring objectives.

Adler believes that if IT leaders boost the effectiveness of four main recruiting methods, you can fill the candidate pipeline in under a month. Here are the four methods and how much each one will approximately cost today's enterprise.

Method 1: Reach out for referrals

Assuming you have job descriptions and a rough hiring outline for the year, you should begin the recruiting process immediately by talking to your internal staff. Tech leaders will find the best new hires via their best employees, explained Adler, because good techies recognize other good techies.

And don't just send out an e-mail to issue the hiring alert and wait for employees to respond, he added. The best approach is to direct your in-house recruiter to sit down with each star employee, one by one, and ask them to draw the organizational charts of everywhere they've worked in the last five years. Then, have the employees name or circle the best people they've worked with at each organization.

"Then, have the recruiter call people right away," said Adler. With just this simple step, you begin to develop a relationship with potential new hires.

Cost: Many companies provide incentives for employee participation in the recruiting effort. While some provide a lump sum when a referral is hired and has stayed for a stated time frame (six months is typical), tech leaders could also offer $500 to a tech staffer who provides several substantive personnel leads.

Method 2: Check out your company's Web site

Another low-cost strategy that can help you locate potential candidates, said Adler, is to contact interested visitors to your company's Web site. TechRepublic members, such as BriM, who manages technology operations at a Florida tech training center, agree.

The first impression that job candidates get of a company is often from the company's online presence, explained BriM. So tech leaders need to make job listings easy to find, exciting to read, informative, accurate, and feature direct contact information. Candidates should be able to find job listings two clicks from the home page.

And don't keep job applicants waiting, Adler pointed out. Set a high metric so that every applicant hears a response from your in-house recruiter within 24 hours.

Cost: Depending on the state of your site and its recruiting pages, costs may run from nothing into thousands of dollars if you need to overhaul your dot-com presence.

Method 3: Advertise on online job boards

While hyped heavily in the late '90s as the most revolutionary approach to hiring, online job boards shouldn't be a primary source of candidates. (For more on this subject, read columnist Nick Corcodilos' TechRepublic article "Stats show online job boards are a bust.") However, they should be part of the mix.

Improve your online ads, and you'll get better results. For instance, don't just list the job requirements. Describe the job in terms that will interest tech professionals. Make sure the ad explains what the job position provides and the company's approach to its employees. It shouldn't give the impression that employees are just gears in the machine.

Cost: Online ad prices range from $275 for a 30-day job posting on Dice.com to $305 for a 60-day posting on Monster.com to several thousand dollars for a package of job listings and expanded employer services on any number of job boards.

Method 4: Hire a recruiter

Professional employment recruiters should be in the mix of the IT employee search. Keep in mind that recruiters come in various flavors, as each boasts unique skills and experience at finding tech employees. Here are the three primary types of professional recruiters:

• High-volume recruiters: These recruiters should be able to hire the highest number of employees in the shortest amount of time. Many companies have in-house recruiters, but if you find they lack technical sophistication and savvy, you may prefer to outsource this function. Expect a high-volume recruiter to be able to find around 12 employees for similar jobs within a month, or three or four employees within that time if each job he or she is trying to fill has unique qualifications, said Adler.
• Contingency recruiters: These recruiters have better industry contacts than high-volume recruiters, typically work at a staffing company or as independent agents, and only get paid if they find the right employee who is then hired.
• Retained recruiters: These are similar to contingency recruiters, as they have strong industry contacts and know the business they're recruiting for perhaps as well as you do. In fact, some of them may have even worked in technology, which often makes these recruiters the most expensive and most specialized of the lot. Due to the high cost of hiring a retained recruiter, use one only when you have a high-level position to fill.

Cost: Typically, recruiters work on a commission basis. While these commissions are usually negotiable, you can expect to pay the following:

• High-volume recruiters: 10 to 12 percent of the hire's salary
• Contingency recruiters: 15 to 20 percent of the hire's salary
• Retained recruiters: 25 to 33 percent of the hire's salary

With this four-pronged recruiting approach— employee referrals, the company Web site, job boards, and recruiters— tech leaders should be able to start filling job openings within three weeks instead of the expected two months or more. And remember, said Adler: "The quality of the candidate is 10- to 100-times more crucial than the cost incurred in hiring the person."