How to Build Referral Pools That Attract Top-Performing Talent

Struggling to fill open positions? Not satisfied with the quality of applications? Struggling to retain your top performers?  If you answered yes to any of these questions, it might be time to consider building a stronger employee referral program.

3 Benefits of a Strong Employee Referral Program

Several studies have been conducted on the performance and productivity of talent that were referred. The results are pretty amazing:

1. Referred Employees Stay Around Longer
   According to a study conducted by Jobvite, referred employees are 55% more likely to be retained by the company after two years compared to employees hired through other channels. This indicates that referrals tend to result in hires who are a better fit for the organization, leading to improved job satisfaction and longer-term commitment.
2. Referred Employees Are Often More Productive
   A study by the Federal Reserve Bank of New York found that referred employees tend to have higher productivity levels compared to non-referred employees. Referred hires were shown to generate approximately 25% more profit for their employers and had lower turnover rates.
3. A Strong Referral Program Reduces Time to Hire
   According to a report by the Society for Human Resource Management (SHRM), employee referrals significantly reduce the time it takes to fill job openings. On average, organizations take about 29 days to fill a position when using employee referrals, compared to 39 days through career sites and 45 days through job boards.

The Key Elements of a Strong Employee Referral Program

While this data certainly makes the case for developing a strong employee referral program, it takes time and a concerted effort to build a productive program. Here are some tips to get started:

1. Clear Internal Communication:
   The hiring manager should develop a clear and compelling communication strategy to inform employees about the referral program. This can include regular reminders, email campaigns, and internal announcements highlighting the benefits of referrals. Emphasize the value of employee referrals, explain the program’s incentives, and provide guidelines on how to make successful referrals.
2. Incentivize and Recognize Referrals:  
   To encourage active participation, the hiring manager should establish attractive incentives for successful referrals. This can range from monetary rewards, such as referral bonuses or commission-based systems, to non-monetary incentives like extra vacation days, recognition programs, or career development opportunities. Recognize and publicly acknowledge employees who make successful referrals to foster a culture of appreciation and engagement.
3. Streamline the Referral Process:  
   Make it easy and convenient for employees to refer potential candidates. Implement a streamlined referral process that includes a dedicated online platform or system where employees can submit referrals quickly and easily. Ensure that the process is user-friendly, mobile-responsive, and allows employees to track the progress of their referrals. Promptly communicate updates and outcomes to referrers to maintain transparency and engagement.
4. Find a Partner with a Strong Referral Network: 
   Building a strong referral program can take years and a lot of effort. To expedite the process, you can also look to partner with an organization like PrideStaff. As one of the nation’s largest staffing companies, we have an extensive database of talent and have invested heavily in building our own talent referral program. Through our “It Pays to Have Friends” program, our top-performing talent actively recruits their friends, family, peers, and past co-workers. We have found that top performers often surround themselves with like-minded people and this creates an amazing pool of talent for our clients.

Ready to Expand Your Employee Referral Program?

PrideStaff is here to help. We can help you leverage our existing referral program in your local market, or assist in developing a strategic workforce plan that attracts new talent and rewards referrals from your top performers. Contact our local workforce experts today to get started.

And, if you know a talented individual that could benefit from a new job, be sure to complete our simple form and earn a bonus through our referral program, It Pays to Have Friends!®