Cost of recruitment: Part 3 – Three ways to minimize cost in your recruitment process.

Almost everyone we speak to are aligned regarding the fact that recruitment is expensive. It is almost as well known as the comment “the most expensive part of recruitment is to hire the wrong candidate”.

This is probably true, as well as it is one of the main reasons for recruitment to be as expensive as it actually is. Regardless of what strategy you choose to go with, it will probably be costly.

But – is it possibly to decrease these costs? And if so – how? In order to break it down we asked ourselves – which are the main factors and items making recruitment so expensive?

First of all, you would need to find out what these items are and how they vary depending on what alternative you choose to go with on recruitment strategy, which we made a framework for in Part 2.

1. If you choose to hire recruiters – the largest cost will of course be the salary to pay your future or current co-workers. As mentioned in part 1 the cost is roughly 684 kSEK/y (excluding systems and licenses).

2. If you on the other hand choose to go with alternative 2, where you hire a recruitment agency to do the work for you – the cost is more clear. As mentioned in part 1 the median cost is between two and three times the monthly pay.

3. The third option, employer branding, is a bit too broad to quantify and is not in the scope of this article.

4. The digital platforms, where Sekando is included uses different pricing models, but for example you can see fixed prices per hire, subscription models and as our model where you set you own fee and let the market decide what’s reasonable.

Regardless of your choice there is a lot of other costs to include in the budget, which could be derived to tools adding a lot of value for both the candidate and the employer:

• A lot of companies uses systems and tools to track candidates and automate different parts of the recruitment processes. These are sometimes referred to as ATS:s (Applicant Tracking Systems) even if they can manage a lot more than it seems looking at this acronym. Well known examples are Teamtailor & Jobylon.
• On top of this, you may want to include objective and data driven tests in your recruitment processes in order to ensure objectivity. You can choose from a bunch of different alternatives, but Alva Labs and Assessio are good examples.
• If it ends here? Not really. There are of course tools that can give you great insight about the candidate experience (Truscruit) and digital ways of looking at the candidates recommendations (Refensa).

So – are these the tools to skip in order to decrease cost? No – they are great! Instead:

1. Set your process before you initiate: how to attract the candidates, who to interview during how many sessions and on what topics, etc. The risk with not doing this is that you add elements along the way on (according to the big picture) irrelevant grounds, which will cost you. Both in terms of candidate experience, time and money.

2. Make calculated decisions on what strategy should be of the most value for you and your company. It’s not obvious that you should go with the same strategy for every recruitment, and there are not one right answer – but there are definitely several wrong ones. Use our framework to begin with!

3. Compare solutions. Regardless if you are looking to implement an ATS or actually bringing in a recruitment agency to help you out – compare your alternatives. It’s hard to know what a fair price is since the level of service is different from the different players on the market.

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