The surge in recruitment platforms, the advancements in technology, and the growing need for specialised expertise are all factors that are fuelling the growth of the recruitment industry. However, the exponential growth in the number of companies has led to an increase in demand for skilled resources. As the job market heats up and the need for skilled resources increases, the recruitment budget also gets affected.
What is a recruitment budget?
A recruitment budget is essentially an amount of money allotted by an organization to be used in the recruitment and hiring process. This includes the salaries of recruiters and advertising fees to post job listings on the corporate websites, as well as any additional costs related to bringing on new employees such as relocation fees or travel costs. Your recruiting budget needs to be in line with your organization’s annual and long-term plans to make sure you’re able to make your business as profitable as possible.
How to calculate cost per hire?
Before you can calculate the cost per hire, you need to assess the following-
- Number of hires required (across departments)
- Estimating basic recruitment costs (job portals, salaries, ads, etc.)
- Fixed annual cost (salaries, recruitment agencies, etc.)
- Cost of technology for recruitment (ATS, interviewing software, etc.)
- Miscellaneous (referrals, etc.)
Once you have the above information in place, you can calculate the cost per hire. Here is a simple formula that will help you calculate the cost per hire-
- Cost per hire = Internal + external costs / total number of hires
- Hiring yield = Number of people hired/ number of people contacted
How to reduce expenses from your recruitment budget?
Here are 5 simple tips that will help you reduce your recruitment costs-
Keep your career page updated
With much at stake in attracting top job seekers, it’s time for employers to take a fresh look at their recruiting strategies. The old playbook of using banner ads and sending spammy emails just won’t do. An effective way to stand out among competitors is by providing candidates with a robust platform for accessing information about open job opportunities that can be done on-demand— anywhere, anytime.
Use social media
Although job posting portals are a great way to post jobs and attract attention from potential job seekers, they pale in comparison to the reach that you get on an organisation’s social media channels. Social media is a good alternative because it gives you access to passive job seekers who aren’t actively looking but would be interested in opportunities should they arise. They also provide a low-cost opportunity to advertise your employer brand throughout the recruitment process.
Use free job portals
Job boards are an effective way to promote your organisation or your product for that matter. There are both paid and unpaid job boards. If you can’t afford to use online job boards to hire talent, there are still free ones out there you can use.
Use a robust ATS
An applicant tracking system (ATS) allows you to manage multiple jobs and achieve consistency between teams in costs and metrics related to talent acquisition. In addition to delivering professional-quality candidate experiences and measurable ROI, an end-to-end ATS helps professionals centralize the applications, enabling teams to collaborate and quickly share accurate information while maintaining compliance with internal guidelines.
Employee retention
Of course, you can reduce hiring costs radically by ensuring that your current employees are well-engaged and satisfied in their jobs. Conduct employee retention programmes throughout your organisation to retain your talent. Provide development opportunities along with benefits that make employees want to stay.
Closing Thoughts
With the rise of artificial intelligence in recruitment and the overall market, it’s a tricky business to recruit that perfect candidate. In recent times, companies have been hiring a large number of candidates but are left dissatisfied with the results. It has become a pressing issue for companies to invest in the right software that will reduce their expenditure and time in hiring candidates.
With Edjobster, independent recruiters and organizations can save time and money from their recruitment budget. Our intuitive interface paired with robust analytics ensure you have a seamless hiring experience.
