Should HR consider external recruiters or stay in-house?

The average cost of hiring a new executive is $34,440, compared to $23,059 for senior-level managers, $17,841 for mid-level and $9,772 for entry-level positions – that’s according to recent data from ELMO. In the pandemic, it’s become increasingly difficult for HR leaders to source and cement much needed talent, with the skills shortage ravaging the global economy. With that in mind, should employers be looking to use an external recruiter, rather than relying on internal teams? Sharon Gray, head of people and culture at OzHarvest, thinks the costs between hiring an external recruiter and having an internal recruitment function are likely to be negligible. “

“Every recruiter has different costs,” Gray told HRD. “It depends how efficient you are and what systems you have internally. My data from last year, when we recruited 142 employees with a team of three people, shows that OzHarvest has been incredibly efficient with our recruiting.”

However, that’s not always the case.

The pros and cons of internal hiring

“The advantages are similar to any advantages when you outsource,” continued Gray. “They free up your time, that’s an advantage, you get the opportunity to leverage professional knowledge from experts in the field, helping you look at it slightly differently than you might do, and giving you advice around applicants and the suitability of applicants.”

A potential disadvantage of using an external recruiter is a of understanding of a company’s values and culture, as well as the type of person that would be a good fit into the organisation,

“As with any relationship where you have to be toing and froing, there may be a misalignment between expectations. It’s navigating those sorts of communications that’s tricky.”

Sharon considers internal recruiters to have a better understanding of the culture of an organisation and its values.

“They understand the nuances of the business as well as creating a connection that can be built between the recruitment process in the first place.’’

The future of interval versus external recruitment

Sharon predicts a shift towards recruiting internally during the coming year, but only after the Great Resignation hits APAC’s shores in March. Similar to the US in 2021, when nearly 35 million workers resigned from their jobs, vacancies have already reached a record high here.

‘’I think people will engage more with recruiters in the next year because of the fear of a really stagnant market,” she added. “However, I think after once it settles down, we can move more towards the understanding that companies need to elevate all those people strategies in businesses to roles that are more important to the organisation. Looking ahead, I think organisations will engage with recruiters strongly because of this fear of the Great Resignation and really putting those systems in place to shore up potential workforce risk. I think after that, once our market settles, people will start to elevate those people roles in an organisation that recognises the importance of bringing recruitment strategies in house - so it can align with their business plans.”

Sharon also predicts a shift from the current demand for technical skills to a higher demand for soft skills - a characteristic that’ been key in 2021.

“In the future, when recruitment becomes less about the technical skills of candidates and more about emotional intelligence, I think internal recruitment will play a more important role.’’