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Improving Retention With a Referral Program

November 12th, 2020

Employee turnover is one of the most costly occurrences in staffing. When an employee leaves the organization, that organization must spend additional money to find a replacement worker. They also lose the productivity gained from having that worker’s position filled, as well as productivity from other workers who must abandon their own tasks to cover the empty position or spend time in the candidate hunt.  

With so much on the table, it’s no surprise that many hiring managers actively seek ways to improve retention. An employee referral program can do just that.  

How Referral Programs Boost Retention 

Employee referral programs engage existing employees to help build a stronger candidate pool. They ask current employees to recommend qualified contacts for job opening as they become available. Some employee referral programs reward recommenders when a recommended colleague is hired by the company.  

Studies show that employee referral programs boost retention by boosting the quality of candidates hired. When workers like their jobs, they are more likely to recommend that a qualified friend or professional contact apply to work with the same employer.  

Meanwhile, referred candidates are more likely to possess the same qualities for success as the employee that recommends them. Referred candidates may also be more engaged in the hiring process from the start, leading to more engagement on the job.  

First Steps to Building a Referral Program 

Planning a referral program is key to its execution. When considering an employee referral program: 

 1. Make sure the program supports your hiring goals.

If you’re seeking to hire workers with specific skill sets, or from a specific background, examine referral program results to make sure the program supports these goals. 

2. Make referrals an event, not an open season.

Rather than simply leaving your email inbox open for any recommendation at any time, ask for referrals for specific open positions. The results will be better tailored to your needs.  

3. Gather referrals in addition to, not instead of, your existing recruiting strategy.

A referral program should enhance your overall recruiting strategy, not replace it. Continue to use methods that work for you, and work with a recruiter for additional help.  

At THE RIGHT STAFF, LLC, our recruiters help clients throughout the Twin Cities find and keep the best talent. We can help you address immediate hiring needs and make a long-term plan for better staffing, engagement and company growth. Contact us today to learn more.  

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