Dated technologies, manual processes, socioeconomic realities of workers and the surge of the mobile web have created a recruitment crisis that costs corporate America and the overall U.S. economy at least $340 billion.
The crisis is especially pronounced in the hourly jobs market, which represents nearly two-thirds of the U.S. workforce, with 75 million workers and more than 100 million hired a year.
Companies using manual processes and dated technologies devote over 1 billion hours, at a cost of more than $30 billion, to handle an excess of 1 billion job applications for hourly jobs. This tally does not include the total costs for recruiting, onboarding and retaining hourly workers.
One might think that social networks could be part of the solution. But that's not the case.
Reluctance to use social network profiles. Over the last nine months my company, Jobaline.com, processed thousands of employment applications in the hourly jobs marketplace and also conducted extensive research of the applicants. Given the opportunity, 90 percent of the applicants chose to not associate their social-network profile or log-in credentials with any job-seeking activity. Even when social-network authentication saves them two or three steps, 90 percent of the applicants opted out and selected the longer process.
We also surveyed a random and balanced sample of more than 250 applicants in three different states who had applied for jobs in the hospitality, retail, transportation manufacturing and construction industries. The overwhelming majority didn't want to associate their social-network account with anything related to employment, due to a fear or invasion of privacy. Regardless of how well we explained that social-network log-ins are used as a mechanism for authentication and to simplify the application process, participants still refused.
Our findings resembled those of a thought-provoking North Carolina State University study published last year, “Examining Applicant Reactions to the Use of Social Networking Websites in Pre-Employment,” which studied the practice of using information from social networks, in a clandestine or open way, to prescreen applicants. The resesarch showed that applicants felt their privacy was violated, resulting in decreased attraction to employers and increased intention to litigate, regardless of the employer's decision to hire the applicant or not.
Wish for privacy. The North Carolina State researchers offered the possible explanation that the results could be related to applicants' view of social networks as a personal space separate from the work environment.
My company's research suggested that 9 of every 10 job applicants surveyed don't know most of their “friends” well enough to be confident using their social network when job seeking. The overwhelming majority of job seekers surveyed felt that judging them based on their social-network profile is like assessing them based on a group of people with the same movie preferences.
Beyond the potential negative impact on the employer's brand, the effectiveness of social recruiting in the hourly-jobs space is very low.
Social networks' low click-through rates. Jobaline.com conducts thousands of multichannel comparisons a day, and job ads on social networks have the lowest click-through rates as compared to other channels, such job boards, TV or employers' career websites.
Plus, the conversion rates for social networks are 25 times lower than those of other online and offline channels in the hourly-jobs space. As a result, companies are spending unnecessary money to generate job awareness, which results in high applicant-acquisition costs. In this segment, people love their social-network engagement, but it is a separate personal space.
Applicant prescreening is a valid activity. It's a way to be sure an individual is a good fit for an organization. But looking at an applicant's social-network activity in a clandestine or open way or using social networks as sourcing tools clearly aren't the best options.