Every year in the US alone employers spend $72 billion — that’s billion, with a B — on recruiting services, staff and technology. For some perspective: $70 billion will buy every franchise in the NFL, MLB, NHL and NBA with some extra cash leftover to buy 25 personal jets. The latter purchase would probably yield a better return on investment than most employers are getting out of their recruitment spend — so why do companies continue to spend so much?
The short answer is that the stakes have never been higher for recruiters vying for talent and 30 percent of recruiters admit they still “don’t know where to start” when it comes to recruiting. Technology helps, but it has to be utilized properly. The investment is just the first step.
A recent survey suggests that 57 percent of companies plan to make a major HR technology purchase in the next 18 months, and recruiting is the most commonly cited focus for the big-ticket purchase. Within the talent acquisition category, most HR leaders say that the ability to analyze and interpret data is their biggest decision driver for recruitment technology investments. Gone are the days of just-in-time hiring, where time-to-fill was the only metric that really mattered to front line recruiters.
Since institutional knowledge shortage seems endemic, enterprise talent technologies must now capture terrabytes of available candidate data. Equally important, they must also make those numbers add up to a compelling business case with functionalities that are inherently accessible to the average recruiting end user.
That’s why advances like federated search and dynamic profiles, which aggregate disparate databases into one single system while capturing and standardizing candidate information and documentation, are critical first steps in solving the data dilemma. By having all potential sources of hire in a single destination, employers also, in effect, have a single destination for collecting actionable data and analyzing the numbers to make better talent decisions.
The ability to simultaneously compare job posting performance and efficacy across all sources is imperative for maximizing and optimizing recruitment spend. For example, one of the nation’s largest private hospitals recently consolidated its recruitment advertising platforms and databases — integrating these sources and associated workflows directly into an applicant tracking system. For the first time, the hospital was no longer reliant on candidate and recruiter self-reporting to track how well individual sources of hire were performing. Now it could track individual applicants, candidates and recruiter activity to finally know where its applicants — and hires — were actually coming from.
This healthcare employer, which had historically spent heavily on premium recruitment advertising sources like paid job general and niche job boards, was able to see that while only 17 percent of its overall active external job postings were live on the online job board Indeed, the aggregator actually accounted for a whopping 80 percent of overall job description views and, ultimately, 70 percent of incoming, qualified applicants. This information enabled the organization to change its focus from paid postings to driving search engine traffic with organic SEO. This shift lead to another 39 percent increase in job views while achieving significant cost savings throughout the organization.
Recruitment advertising is just one example of why systems integration is an important first step to unlocking the power inherent in big data — and the decisions it enables. Since the information collected by resume and profile parsing becomes standardized, so too does the associated data, allowing visibility into what’s working — and what’s not — in talent acquisition across the enterprise.
The integration and consolidations of systems not only makes it easier to get a better view of the return on recruiting resource investments, but also optimize that resource allocation for future tools, technologies and talent. With $72 billion dollars a year on the line, you don’t need to do the math to see how it all adds up when it comes to finding, attracting and engaging top talent.
Originally Posted on The Human Capitalist Blog