Career Advice Nov 17 2011

Recruiting Spend Up, More High-Tech

By joseph walker

Companies are spending more this year on recruiting but are focusing their dollars on more high-tech methods than in the past, a new report suggests. Additionally, more companies are hiring their own full-time recruiters or temporary contract recruiters to cut down on the costs of outside recruiting agencies, the report from Bersin & Associates, a human resources consulting firm, found.

"There are shifts in how companies are allocating their money," said Karen O'Leonard, an analyst and author of the Bersin study. "In the long-term, the shifts will save companies money."

The report, The Talent Acquisition Factbook 2011, is based on surveys of 414 companies ranging from small to large businesses, conducted in June and July of 2011. Respondents were chosen from Bersin's and LinkedIn's databases.

Job boards and internal candidates were the biggest sources of filled open positions, accounting for about 38% of all hires. Third party recruiting agencies accounted for just 9% of filled positions, but consumed about one-third of recruiting budgets, the reports said. The cost of using an agency averaged about 21% of a new hire's first-year salary, the report said.

While job boards and outside recruiting agencies were still among the most popular methods of recruiting, some companies are shifting their spending into more high-tech strategies. One company cited in the report, Colorado-based engineering and construction firm CH2M HILL, shifted half of its recruiting budget away from job boards to professional networking sites like LinkedIn and Viadeo, and social media tools like Facebook, a company spokesperson said.

Some companies are also exploring newer software-based approaches to recruiting. Many companies use what are known as Applicant Tracking Systems. These software programs collect and collate all of the personal and professional information a job candidate submits online, and then ranks each candidate according to how well they match up to a given job description.

But candidates who are passed over for a given job essentially disappear from the system, even if they might be a good candidate for a future job opening, said Katherine Jones, director of research and human capital management at Bersin. "It's an Industrial Revolution-age concept," she said.

As an alternative, more companies are using Candidate Relationship Management software like LinkedIn's Recruiter tool or Avature's CRM Web 2.0, which allows companies to track and communicate with candidates who may or may not have applied for a job with the company. In this way, companies can develop a talent pipeline for a position before it even opens. This kind of software allows companies to keep candidates on the "backburner until something comes up and then they can start pursuing them aggressively," Jones said.

Write to Joseph Walker at

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