Bringing Recruitment In-house - Why do it?

For years, ambitious businesses have been building Internal Recruitment functions as a way to reduce recruitment costs and enhance the quality of their hiring process.

This short article will summarise their motives for doing so in greater detail to help you decide if this approach is right for you.

Cost Savings

A typical recruitment agency fee is 20% of the candidates’ basic salary; meaning a £50k hire could cost you £10k in fees. If we assume you make one of those hires per month, you could be spending £120k on recruitment fees each year.

An In-house Recruiter salary will likely range from £40-65k depending on their experience level and industry experience, and they should easily be capable of directly recruiting 2/3+ hires per month (potentially far more depending on the role types).

It’s true, they do need to be provided with some tools to achieve this, such as a LinkedIn-Pro account, and for that you can expect to pay around £7k per year.

Put like that, an In-house Recruiter should deliver a return on their entire annual cost inside their first 6 months of employment.

Recruitment Process Improvements

Recruiting is incredibly hard and businesses are repeatedly disappointed by missing out on their dream hire, as well as making poor hiring choices.

An experienced Recruiter can embed better quality hiring processes that make everything run more smoothly. This includes but is not limited to:

• Interview training for line managers as well as the implementation of psychometric tools & scorecards
• Speeding up the interview process through effective process management
• Implementation of recruitment systems to ensure candidates aren’t missed and that data is collated and utilised
• Enhancing candidate experience to ensure the employer brand is protected

Employer Branding

Effective Recruiters help turn their employer in to a destination of choice for high-calibre professionals. This is achieved through developing a clear employer value-proposition and expertly communicating it with the market.

Over time, this improves the response rate of headhunt approaches and the quality of inbound applications, saving time & money and providing access to a higher calibre of candidate.

Market Feedback

Hiring companies who rely solely on recruitment agencies don’t have a direct line of feedback from the candidate market.

Good agencies will provide details on how the brand is being perceived and any hiring challenges they encounter, but not all will, especially if the commercial terms of your partnership are less favourable than those they hold with other higher paying clients.

An In-house Recruiter can solicit opinion from candidates first-hand, helping the business to address any reputational or role positioning challenges, thereby enhancing their ability to effectively recruit both now and in the future.

Potential for Exclusivity over Target Candidates

In many cases, agencies will be forwarding their sought-after candidates to multiple organisations at the same time to improve their odds of a successful placement. This is perfectly understandable assuming no exclusivity has been agreed, but it does mean you could potentially face some stiff competition.

Running your own direct process means that you may find a candidate who isn’t yet speaking to any agencies and therefore isn’t being considered for other roles. This could potentially leave the path clear for a much simpler negotiation.

Talent Pooling

Many candidate approaches are met with a “not now but maybe later” response, or something to that affect. An In-house Recruiter can store that information in their recruitment system or on LinkedIn, and follow up later.

Over time, these follow-ups accumulate resulting in a steady pipeline of candidates readily available to supplement the Recruiters ongoing sourcing efforts. This should improve the efficiency of your Recruiter, resulting in yet more direct, fee-free hires!

Diversity & Inclusion

With end to end control over your hiring process, you can better ensure that your Recruiter is considering a diverse mix of candidates, rather than simply shortlisting the usual-fit.

This can lead to greater diversity of thought and, thus, great problem solving and ideas generation once they’re part of the team.

What next?

If you’re ready to launch your own Internal Recruitment function then please get in touch with Hawkwood to discuss how we can help.

We’ve had the pleasure of helping some amazing start-ups accelerate their hiring strategy, and recent examples include Thriva Health, ScreenCloud, Capital on Tap, Yieldify and Conductor. We’d love for you to join the growing list!

Get in touch at [email protected] or 0207 190 9555