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Alternatives to Recruitment: Purpose, Advantages, & Disadvantages

Instructor: Tammy Galloway

Tammy teaches business courses at the post-secondary and secondary level and has a master's of business administration in finance.

In this lesson, we'll define recruiting and discuss its purpose and costs. You'll also learn about alternatives to recruiting and their advantages and disadvantages.

The Purpose of Recruiting

Employees are one of the largest assets in an organization. Employing the right people for the job is paramount to an organization's success and recruiting is one pathway. Lori, the human resource manager at ABC Corporation explains to her department that recruiting involves advertising, sourcing, interviewing and identifying potential candidates for employment vacancies. While ABC has implemented a strong recruitment process in the past, they need to explore other options as their recruiting costs are exorbitant. For the rest of this lesson, we'll discuss the operational costs of recruiting and alternatives to recruiting.

The Costs of Recruiting

Lori believes sharing the costs of recruiting with her department will help them understand the seriousness of identifying alternatives. She starts by explaining that advertising and promotion of ABC's job vacancies for the last year exceeded $247,000. This cost included print and online advertisement with large employment websites. They also paid a hefty amount to recruitment agencies to source potential applicants. Additionally, the department's cost in salaries and time to complete the recruiting tasks are almost immeasurable. After Lori's explanation, one employee asks if ABC will layoff any human resource personnel due to these findings. Lori states that anything is possible, however, if they can become more innovative and reduce costs, layoffs are highly unlikely.

Alternatives to Recruiting

Lori starts by dividing the department into five groups and asks them to brainstorm one recruiting alternative and identify advantages and disadvantages of their recruiting alternative. Let's see what they discussed:

Employee Leasing

Employee leasing is when an organization partners with a staffing agency that sends workers to the organization and pays their salary and benefits. Organizations should identify agencies who understand their industry and the type of labor needed.

Advantages

  • costs savings
  • reduction in internal recruitment time

Disadvantages

  • can be difficult to find a reputable employee leasing organization
  • reduced loyalty and commitment since worker is not a permanent employee of the company

Overtime

Overtime allows current employees to work in excess of the standard 40 hours per week to complete job tasks. Overtime only applies to hourly workers.

Advantages

  • increased employee motivation and satisfaction
  • employee is familiar with organizational culture and job responsibilities

Disadvantages

  • federal law requires organization to pay overtime at a minimum rate of time and a half
  • employees may become dismayed when the overtime option is alleviated

Outsourcing

Outsourcing hires a vendor for all recruiting activities. The vendor should be familiar with the organization's industry and have a proven recruiting track record.

Advantages

  • lower costs
  • increased synergy and recruiting expertise

Disadvantages

  • analyzing and managing the effectiveness of the vendor's recruiting efforts
  • allowing a third party to represent the organization

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