One of the factors that contribute towards the success of a business includes having the best possible workforce. Although finding workforce tends to be time-consuming and costly, all firms will have to recruit workers at some point sooner or later.
Businesses typically look for new workers when an existing employee has left the business and when the business is growing in size. In both of those cases, a business is unlikely to achieve its business aim and business objectives unless it recruits the right number of workers with the right skills at the right time.
In general, recruitment of workers can be broadly categorized as internal recruitment and external recruitment. When a business has a job vacancy to fill, it can either look for someone in its existing workforce (internal recruitment), or search outside the business (external recruitment).
Let’s look in details at these two ways of finding workforce for a business organization.
Internal Recruitment
Internal recruitment is when a job vacancy is filled by someone who is an existing employee of the business organization. A business decides that it already has the right people with the right skills to do the job. Instead of filling a job vacancy by employing someone from outside the firm, someone who already works for the business tends to be promoted.
That is why internal recruitment is suitable for employees who want a promotion within the business. Also, this might happen when a business restructures its organization of human resources. The person who is hired internationally already knows the organization’s way of working very well.
The vacancy can be advertised on the company’s internal notice board, in a company newspaper, staff magazines, and advertising media or via internal mail. Sources of internal candidates commonly include present employees, employees’ friends, former employees and previous applicants.
The main advantages of internal recruitment include:
- Less down-time. It is easy and fast to select internal people because they are already familiar with the business – its management, culture, operations, etc. Internal recruits can take up their new roles with minimal time used to get familiar with the operations of a business. They will spend more time on getting work done as they are able to adapt and settle into the new post quickly.
- Less risk. It is less risky to employ new workers from inside the organization because their actual abilities and skills have already been truly tested in real workplace environment. Applicants are already well-known to the recruitment team who are familiar with the strengths and weaknesses of applicants, know the organization and its internal methods as well understand the culture of the firm. Hence, they might be more suitable. In case of filling in vacancies for a senior post, staff will not have to get used to new style of management approach.
- Motivational. Internal recruitment can act as a form of motivation because it provides internal people with opportunities for promotion. This leads to improved morale as workers can become more motivated when they see that there is a chance of promotion. Also, when existing employees see someone being promoted, this chance for progress motives them intrinsically. Promoting internally can create solid employee loyalty and strong commitment to the firm.
- Cost effective. It is cheaper and quicker to recruit from within an organization to fill in a vacancy than using external recruitment methods because suitable candidates are readily available. Hence, internal recruitment saves time and money. Additionally, internal recruits require shorter induction periods, less training and are more likely to stay with the company for a longer period of time due to compatibility with the business culture.
The main disadvantages of internal recruitment include:
- No new ideas come into the business. Without external recruits, it might be difficult to get an influx of new ideas into the business. Without know-how from outside the firm coming in, the business may suffer from having outdated working practices. When too many workers stay in the firm for too long, staff may lack the necessary modern skills and qualities to remain competitive on the market.
- Fewer applicants available. Internal recruitment offers a limited number of potential applicants as only current employees of the business are considered. This significantly limits not only the number of potential applicants but also their quality such as skills, experience, education, personality, etc. Candidates of better quality who may have been available from outside of the business are overlooked. Therefore, in the end the company may end up recruiting less qualified applicants.
- Time-consuming. When a business promotes somebody internally, this in most cases leads to another unfilled vacancy in the organization. Unless the worker’s previous job has become redundant, there will be another position to fill. Not only promoting, relocating and redeploying an internal candidate takes time, but it might be more time consuming when the vacant position is taken by someone who is not the exact match, requires additional training and development. Also, if no internal candidates are suitable, then the business will still have to use external recruitment.
- Internal politics. There could be resentment and conflict amongst fellow workers who were unsuccessful for the internal post. There may be jealousy and rivalry between the person promoted and the candidates not appointed. This can create internal politics leading to an uncomfortable working environment or even cause conflict within the workplace amongst people involved.
In practice, most of vacancies are filled using external recruitment.
External recruitment
External recruitment is when a job vacancy is filled by someone who is not an existing employee of the business organization.
A business decides that it currently does not have the right people with the right skills to do the job. Instead of filling a job vacancy by employing someone who already works for the business, someone from outside the firm is hired. The job vacancy is filled by appointing someone new to the company.
That is why external recruitment is suitable for increasing the choice of candidates for a job. Businesses that are growing fast, or those having high labor turnover, will frequently use external recruitment to look for workers.
The vacancy must be advertised in newspapers, specialist publications, on the Internet, etc. Factors that affect the choice of advertising media include type of job, cost of advertising, readership (how many relevant people does the medium reach?) and circulation (how frequently it is published, e.g. weekly, monthly, annually?). Sources of external candidates may also commonly include employment agencies, job centers, headhunters, universities or employee referrals.
Let’s take a look at those various methods of advertising the vacant post:
1. Newspaper advertising. This method is used for attracting a wide audience of job seekers, however targeting the right people can be difficult and the advertising costs are high.
A. Local newspapers. Usually used for unskilled or semi-skilled positions including manual positions and clerical work. Local newspapers are cheap and seen by many locals however only those who buy the newspaper will see the job adverts. This makes it easier to find suitable candidates locally.
B. National newspapers. Usually used to skilled or highly-skilled positions including senior positions and management jobs. National newspapers are also cheap and read by many people around the country however it is more expensive to advertise in than a local newspaper.
2. Specialist trade publications. This method is used for attracting a very specific audience as adverts are aimed at exactly the right people such as those who have particular technical skills. Different publications are read by specialist people such as teachers, managers or truck drivers, however it might be quite expensive to advertise in those trade magazines.
3. Internet advertising. Many businesses these days are using the Internet to advertise their jobs as it can give them a global reach yet only incurs relatively low costs. Internet advertising can be either done through specialist recruitment websites such as LinkedIn, Glassdoor, SimplyHired, Monster, etc. or company own websites where job vacancies are advertised.
4. Commercial employment agencies. These professional recruitment agencies are specialists in finding the right people for the job as they charge a fee for their services. While using employment agencies such as Adecco or Manpower saves the business a lot of time it is very expensive to use them. They do all of the recruitment work for the business including advertise the job, read CV’s, check qualifications and interview suitable applicants for a job to make recommendations for selection to the hiring firm.
5. Job centers. These are non-profit organizations funded by the government to help people find employment. Businesses can advertise their vacancies at job centers free of charge for the candidates to view them. However, job centers tend to advertise relatively low-paid for jobs for unskilled and semi-skilled worker, so might not be suitable for all businesses.
6. Headhunting. Headhunters are high-end hiring companies that try to entice skilled and experienced employees by aggressively poaching of a person from his or her current employer. To persuade the workers to leave their current job, headhunting companies offer very attractive new contracts that are simply too good to resist.
7. University visits. Businesses often go to specific universities to advertise their jobs, mainly for junior management posts or technical positions. By visiting universities, companies can access a large pool of potentially suitable and talented people in a specific area to choose from.
8. Employee referrals. Direct contacts can be initiated based on personal recommendations made by a current employee who knows people with the necessary skills and qualities to fill a job vacancy. At the end of the day, having a vast network of professional colleagues can get you a very attractive job offer.
The main advantages of external recruitment include:
- Influx of new ideas. With external recruits who are considered ‘new blood’, it is easy to get an influx of new ideas and ways of thinking into the business. With know-how from outside the firm coming in, the business will benefit from having most up-to date working practices. When not too many workers stay in the firm for too long, staff will possess the necessary modern skills and qualities to remain competitive on the market. When new people share best practices, this gives the business insight into how a rival firm might have done things, to improve the effectiveness and efficiency of the business. Additionally, this helps existing staff to focus on the future rather than ‘the ways things have always been done’.
- Wider choice of candidates. External recruitment offers a larger number of potential applicants with different skills and experience as not only current employees of the business are considered. This significantly increases not only the number of potential applicants but also their quality such as skills, experience, education, personality, etc. External recruits might be more suitable than any of the internal candidates because they have gained the experiences and skills required by the business from their previous employers. Having larger pool of applicants increases the chance for a business of finding the ideal candidate for the job.
- Minimizes internal conflicts. External recruitment decreases internal politics. It helps to avoid the risk of upsetting current workers when someone who is internal is being promoted. Consequently, it avoids resentment sometimes felt by existing staff if one of their colleagues is promoted above them. Hence, the risk of workplace conflict is being reduced.
The main disadvantages of external recruitment include:
- Greater degree of uncertainty. External recruitment has more risk than internal recruitment. It is because when hiring external recruits, HR managers take a risk as they do not really know everything about the candidates to do the job effectively. And even if they are, they might not fit into the corporate culture very well which may be demotivating. Actual abilities and skills of new workers have not been truly tested in real workplace environment yet. In case of filling in vacancies for a senior post, staff may not have to get used to new style of management approach.
- Time-consuming. It is more difficult and takes longer to select candidates externally to fill the vacancy than using internal recruitment. Preparing job advertisements, advertising, shortlisting, interviewing, checking references and selecting people all take up valuable management time. External recruits can take up their new roles with more time necessary to get familiar with the operations of a business. They will spend less time on getting work done as they are not able to adapt and settle into the new post quickly.
- Expensive. External recruitment can be very expensive for a business organization to fill in a vacancy than using internal recruitment methods because suitable candidates are not readily available. Other recruitment costs include paying for job adverts in newspapers, the time used up by managers involved in the recruitment process (e.g. on interviewing candidates). Additionally, external recruits require longer induction periods, more training and are less likely to stay with the company for a longer period of time due to compatibility with the business culture. Hence, external recruitment involves more time and money.
Summary about finding workforce
Recruiting the right people from the start is very important because if the company fails to do it right, it will have to go through the whole recruitment process all over again.
Internal employee supply relies on using current employees to meet future changes in demand through promotion, staff development and training, staff loss and retirement, flexibility and legal factors. Internal Recruitment means moving up with in a company. This could make people more committed to the company.
External employee supply relies on housing availability, transportation, competition, unemployment in the area, more people will be looking for jobs and population and demographic trends as older workforce will eventually bring retirement, etc. thus less local workforce is available.
