Quite the headline don’t you think? While it may appear to be clickbait, I assure you this article will be talking about talent trafficking and everything that’s wrong with the recruiting industry as we know it.
Not unlike human trafficking, talent trafficking is the practice of transactional hiring, whereby a third party agency finds a warm body to fill a seat in an organization for a rather large fee. There is a description of what the organization wants, focused mainly on skills and experience, and there is a pool of people for that third-party agency to pull from to fill the “order.” That’s it. Sounds a bit dirty, doesn’t it?
The truth is that the recruiting industry as a whole has left a very bad taste in the mouth of many executives who felt the need to do business with a third-party recruiting agency. The fees are exorbitant and the return is generally not.
Now, a stat: “The average cost of a bad hiring decision can equal 30% of the individual’s first-year potential earnings,” according to US Department of Labor and Statistics.
Most recruiting agencies do the bare minimum to find that warm body and it’s a 50/50 chance whether that person is going to be a match for the company. Yet, the agency walks away with a substantial fee. Every executive we talk to explains that one of the top issues keeping them up at night is having no confidence in the talent being hired to build their teams.
I don’t think it’s a secret that the recruiting industry is broken. Of course there are excellent recruiters who go above and beyond to understand the profile of an ideal candidate, who work hard to help both candidate and company make the best decision for each of them. However, there just aren’t enough of those recruiters to make the change that this industry needs. The change must come from giving organizations the power to identify and hire the right people.
More stats: “66% of employers said they experienced negative effects of bad hires. Of these employers, 37% said the bad hire negatively affected employee morale. Another 18% said the bad hire negatively impacted client relationships. And 10% said the bad hire caused a decrease in sales,” according to a study from the National Business Research Institute.
Unfortunately, many organizations lack a focused strategy to take control of their talent needs. HR and recruiting teams are scrambling to fill numerous open positions in every department. Their hope is that by posting vague job descriptions, filtering through hundreds of resumes using keywords, conducting a few phone interviews, and even fewer in-person interviews will result in the best hire. Very few companies launch effective recruiting campaigns to attract and engage the right types of talent. The “right fit” is typically determined in the last few in-person interviews, but even then it’s an educated guess. Most of their efforts are afterthoughts or reactions – bias and gut feeling – rather than proactive and thoughtful because management needs positions filled – and fast. The more bodies we throw at the open positions, the better right? Wrong. The stats above show this lack of strategy not only costs money but has a negative impact on culture and engagement.
It’s time to break the cycle of talent trafficking. There is no talent war, so we don’t need to hire outside agencies to steal top talent from other companies. We certainly don’t need to pay ridiculous fees that fuel the talent trafficking epidemic. What we do need is to take the time to understand our stories as companies and to understand why our best people give their heart and soul everyday to help grow our companies. There are people out there who want to work for each of our companies. We just need to do a better job of telling our story to find them.