Following recent research which shows that retention rates are 39% better through employee referrals, Real Links has investigated how much job-hopping costs UK businesses and found the figure to be £71.6 billion a year on average, based on figures from the ONS and research by Glassdoor.
In response, Real Links, which tackles the problem of job-hopping through automated employee referral recruitment, has built an onsite tool, which shows how much a business can save when they use this type of recruitment method.
Statistics show that hires made as a result of employee referrals enjoy greater job satisfaction and stay longer at companies – 46% of employee referral hires stay for more than one year compared to only 33% of hires through career sites.
Job-hopping in the UK
There are currently 32.53 million people in work in the UK and, on average, UK workers will change job every five years. With figures suggesting it costs employers an average of £11,000 per person hired, the overall cost of job-hopping to the UK economy is £71.6 billion each year.
The Real Links ROI calculator is freely available on their website for businesses to use. It allows employers to enter a few key figures, such as how many employees they have and will calculate the potential talent pool size in their employees’ networks and the amount of money they can save on recruitment costs.
The Real Links platform gives businesses owners and HR teams access to a potential talent pool of hundreds of thousands of referral candidates. It also creates anonymised profiles, ensuring there is no unconscious bias when selecting candidates.
By sending employees referral recommendations when their connections are matched to a job, and using gamification to incentivise and reward employees for using the platform, employee engagement is increased which leads to greater retention over the long-term – reducing job-hopping.
Sam Davies, CEO and co-founder of Real Links, said: “We’re hoping that with this calculator, employers will be able to see how much they can save by adopting our less traditional and more technological referral recruitment method.
“Historically companies have struggled to find an effective recruitment solution that addresses retention. The potential cost savings – not just in direct recruitment costs, but over the longer term – can be significant.
“That’s why we built the ROI calculator to highlight just how much can be saved by using referrals rather than traditional recruitment methods.”