Hiring based on internal referrals may not be cost effective - November 22, 2012

Numbers show that hiring people based on internal references is exceedingly high and constitutes 90% of all recruitment in India.

Numbers show that hiring people based on internal references is exceedingly high and constitutes 90% of all recruitment in India. This is in stark contrast with UK where 85% of hiring is done through specialists. Experts believe that the Indian way of basing everything on internal references may lead to mis-hiring and more higher costs incurred by the company. It is believed that this system may work well for entry level positions but for the higher ones the company should develop a holistic approach that includes hiring recruitment professional, hiring through job portals, campus hiring and internal job posts.

Source: www.economictimes.com, November 22, 2012. “Internal referrals may keep talent out of firms and lead to high mishiring costs”

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