"We’ve spent less than $1000 on hiring, but I’ve had coffees or breakfasts with probably hundreds of candidates. Measured by hours, recruiting is one of our largest investments"
> In truth, it wastes the talent you've built to not be aggressively increasing their comp to match the skill increase you're providing.
The issue is that we don't quantify what hiring someone actually costs. We're willing to spend $20k on finding a candidate for 160k yet the people in the same position are sitting at 120k and getting a 3-4% raise.
The new person needs time so expect at least a month of training, yet no one quantifies that as well.
> but it is unimaginable how one doubles the highly compensated / hard to find employee count in a year at that scale.
You throw an EXCESSIVE amount of money at the problem and over-hire (and just naturally weed people out). Recruiting firms will gladly take anyones money to help solve this problem.
> A common estimate is that the hiring process costs a year of salary.
If the company wants to make hiring incredibly difficult (too many companies do), I can see it costing that much.
So stop doing that.
Having been in many startups doing a lot of hiring, if each hire cost a year of salary we'd have burned through out funding many times over and yet we didn't. So it doesn't have to cost that much. Keep it simple, hire fast.
>The cost of recruiting and interviewing candidates, not to mention training new hires, is huge.
As a team leader let, I have been so frustrated with this. HR has no clue on how time consuming is to transfer context knowledge. There is a point where companies should do all in their power to keep people. But they fail to account for these types of indirect costs.
> Great hires are hard to find. Why not hire both?
> It also cost money in time and effort for that much recruiting effort
Yes, Great hires are hard to find, and yes, it also cost money in time and effort for that much recruiting effort.
However, in the current market, great hires are getting easier to find and even if all the current team was doing was interviewing all day, every day (which is not the norm), the 1-3 months it takes to onboard an employee is the break even point.
Now when you notice that the current team does interviews an hour or so a day, unless a company was flush with cash (as MAANG was the last decade), hoarding candidates because they are hard to find, isn't capital efficient.
What's the solution? I propose increased transparency between candidates, so they can quickly figure out which companies are serious and which not.
>>Recruiters and employers are very much aligned on getting as many people as they can, and that's the problem.
I don't think this is true. I think that recruiters are looking for this (cause it's how they get paid). I do _not_ think that employers are looking for quantity.
> They are spending 14% more on recruitment advertising
Oh boy, huge assumptions there, so bad that I would associate that thinking with HR recruiters. What matters is what selects/filters for desirable employees. Getting 14% more applicants is a terrible metric to be measuring - https://wikipedia.org/wiki/Goodhart%27s_law which is obvious since one can increase applications by advertising in irrelevant places to get more irrelevant applicants.
Alternatively 14% more could be extremely important, if a lack of salary indication filtered for bad candidates, and salary indication brought in good candidates.
> A single day of delay in response causes 28% of candidates to become unresponsive to recruiters (this is from our company's research). It drops to 51% become unresponsive 48 hours later. [your top level comment].
That’s an interesting metric, since anecdotally the best candidates get snapped up extremely quickly.
It is obviously very difficult to find good factual correlations: a lack of good data just produces opinions.
By finding enough candidates for enough businesses willing to pay the huge finders' fees that recruiting firms demand.
One of the things that amazes me is that companies will pay a recruiting firm tens of thousands of dollars to find a candidate that makes it through the interview process and stays there for at least 90 days but then they only offer $500 to their employees for referrals that get hired. I pointed out to HR at one company that I worked for that one of their recruiting partners pays $1000 for a referral that gets hired; given how much they would pay a recruiter, they should be offering at least $5,000 referral bonuses to someone recommends a candidate they hire, whether the person making the recommendation is an employee or not. They decided to increase the referral bonus to match the recruiting company (I kept feeding referrals for my employer through said recruiting agency -- my relationship with them started before and lasts long after being with that employer).
Do you have any data showing acqui-hiring of $1 billion or more? I've never heard of such an amount and retention after an acquisition is really, really hard. Seems crazy to spend so much only to have people leave after 1-2 years (or less depending on the company).
> The beauty of this approach is that you don't lower your hiring bar.
You don't lower the bar but you do put a locking mechanism on your recruiting pipeline that reduces your hiring throughout in an already supply constrained environment and you impose greater hiring costs to make sure you always have a candidate.
Now that may still be a profitable thing to do, but you can pretend there are no costs and downsides. What you need to do it look at all the pros and cons and balance those considerations to find out what is most profitable. Anything that isn't profit maximizing over the time scale we are optimizing for is also to the detriment of the company.
> Oh boy, huge assumptions there, so bad that I would associate that thinking with HR recruiters.
HR and recruiting is not legendary for financial acumen, but they do spend in aggregate, billions on advertising, and they do in many cases have very good analyitcs on that spend.
> Alternatively 14% more could be extremely important, if a lack of salary indication filtered for bad candidates, and salary indication brought in good candidates.
We've not seen a change in quality of candidate in either direction. It does reduce the cost per applicant significantly.
> A single hour spent by a bad candidate wastes at least 3 man-hours of work by the company, and most likely more.
So? Companies need employees. They have to do what it takes to get them. If it weren't worth it, they wouldn't do it.
It makes sense to me that more time in aggregate is spent by the company than the candidate, because the company has dedicated recruiting/HR/coordination people that handle the process. I, as an already full-time employed developer, don't have as much time to burn with interviewing.
That's literally the next sentence of the article after “We spent less than $1,000 on hiring." The article explicitly acknowledges this issue.
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