The Value of Referrals to Agency Recruiters

We know that referrals are highly valuable to agency recruiters, but let’s look at how referrals improve a recruiters efficiency in time and effort saved. Note that this article refers to the area where I have experience: outbound recruitment agencies sourcing passive candidates (aka headhunting or executive search). It may not apply so readily to inbound job board recruiters who deal more with active job applicants. 

Recruiting is a Numbers Game.

In short, every recruiter needs to talk to X number of prospects to identify Y number of candidates, of whom Z will become active job applicants at some point in time. The weeks, days and hours committed in building these relationships for your average recruiter is enormous and one of the main reasons why agency fees are so high. It is extremely hard to run a profitable recruitment firm without covering all the days and hours of investment to find the “high value” candidates that clients pay for. 

These numbers are generalised and every recruiter will differ, but we can reasonably assume that for every placement there are 10 qualified “passive” candidates known to the recruiter, and it likely took up to 50 or more calls to find those 10 candidates. Including the time invested in meetings and follow ups to develop the relationship, the actual number of hours invested could be 4-5 hours per candidate and over 200-250 hours in total if we include the false positives screened out along the way.

The above example only considers a single job category, so multiply that out over the number of jobs a recruiter covers in their field and you start to see how much work goes into identifying the high value candidates. 

Referrers can save up to 20X of their time and productivity by using Referable instead of status quo processes, while recruiters can save up to 4X of their sourcing time.

Reduce X for More Y and Z

Referrals are the shortcut through all these hours of communication and relationship building. Referrals are the way to get more Y’s (candidates) and Z’s (placements) from less X’s (prospects) and this results in a massive saving in time that can be reinvested for better productivity.

When candidates are actively introduced to the recruiter (hot) or the referrers name can be dropped (warm), the process of building mutual trust is much faster than for a typical cold approach. Regardless of whether the introduction is made hot, warm or cold however, the fact that the candidate has been pre-qualified by someone in the know automatically makes them a higher probability candidate than any cold prospect. The success rate is so much higher.

Time Is Money

This is where Referable comes in. It can take a referrer less than 1 minute to submit their responses using Referable. Even if we take a worst case scenario where a referrer adds detailed comments and manually adds a few recommendations, it may take them 5 minutes. Compare this to having to join a meeting or call with a recruiter to go over candidate lists. That kind of activity usually takes up to an hour, which puts a best case scenario using Referable up to 60X faster than the status quo for the referrer, and worst case up to 20X faster.  

Referable also provides huge gains for recruiters by automating the Long List process: candidates are automatically matched to referrers. While this time saving from screening is not measured, user averages at the Short List stage suggest that for every 1 “referable” candidate there are 4 that are not. This means Referable gives the recruiter a potential 4X gain in sourcing time – on top of the gains made with Long List automation.

When we say “faster” we are really talking about productivity gains, so let’s recap those numbers. Referrers can save up to 20X of their time and productivity by using Referable instead of status quo processes, while recruiters can save up to 4X of their sourcing time. We think that is extremely significant!

Given that every recruiter should be focused on delivering high probability outcomes, soliciting targeted referrals is simply a “no brainer”. What recruiter or recruiting manager would not want more referrals? 

So why don’t recruiters ask for more referrals? Let’s look at that in the next post.

Referable AI has been developed to make referrals easy. Built by a team with experience in executive search, RPO, in-house recruiting and HR tech, the Referable app helps both in-house and agency recruiters to target talent and solicit more referrals faster than ever. If you would like to learn more, drop us a line at hello(at)

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