RESEARCH Recruiting Online

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1 RESEARCH Recruiting Online A Guide for Decision Makers

2 Introduction This guide is intended to provide employers with an overview of online recruitment and how it can be utilised to attract top talent effectively and efficiently. The guide is aimed at senior decision makers, including top management of companies and those involved in setting and executing talent acquisition strategy. The data, insights and opinions presented in this guide are based primarily on the Middle East market and may not be fully applicable in other countries or regions. This guide has been compiled by GulfTalent, the leading provider of online recruitment services in the Middle East. 1

3 Contents Online Recruitment Cost-Benefit Analysis Developing an Online Recruitment Strategy.. 8 Appendix Analysis of Middle East Online Candidates.. 16 Glossary

4 Online Recruitment Cost-Benefit Analysis 3

5 The Internet provides an ideal channel for employer branding, candidate sourcing and efficient screening Uses of Online Recruitment Employer Branding Promote the company as an employer of choice Gather market intelligence that shapes recruitment strategy Candidate Sourcing Receive applications from active candidates Headhunt passive candidates through targeted database search Screening & Selection Automate screening and filtering of applicant CVs Organise the logistics and administration of the recruitment process 4

6 Online recruitment has proved an effective substitute for newspapers as the primary channel for sourcing candidates Overview of Recruitment Process Online Recruitment Portal Candidates Recruitment Agency Employer Newspaper 5

7 Online recruitment compares favourably with other channels in terms of reach, effectiveness and speed of getting results Recruitment Channels Performance Comparison Online Recruitment Newspaper Advertising Recruitment Agency Executive Search Product Product name Job posting / CV search Advertising / Classified Contingency recruitment Retained search Geographic Reach Locally-based candidates International candidates Type of Candidates Active candidates Passive candidates Service Coverage Sourcing candidates CV Filtering Interviewing Speed Average time * 1-10 days 5-15 days ** 3-30 days days * Defined as the total duration from the time a vacancy is sent to the HR team, until the HR team can provide matching CVs sourced from the supplier. ** Includes lead time required for an ad going into print, time to receive CVs and screening time 6

8 Recruiting online is by far the most cost-effective method, with total cost per hire as much as 90% lower than traditional channels Recruitment Channels Cost Comparison (US$) Typical Supplier Fee per Hire * Supplier Fee Structure Internal Cost Per Hire ** Total Cost Per Hire Online Recruitment $ Fixed fee, regardless of number of hires Payable upfront $1,500 3,000 $1,600 3,300 Newspaper Advertising $ Fixed fee for advertising, regardless of number of hires Payable upfront $2,000 4,000 $2,200 4,500 Recruitment Agency $9,000 12, % of annual salary per candidate hired Payable upon successful hire $1,000 2,000 $10,000 14,000 Executive Search $12,000 21, % of annual salary per candidate hired Payable 1/3 upfront, 1/3 on short-list, 1/3 on hiring $1,000 2,000 $13,000 23,000 Source: Interviews with HR managers, supplier terms, GulfTalent analysis * Estimated based on hiring a mid-level candidate with a compensation of US$ 5,000 per month ** Includes time of HR team, travel expenses of HR team and/or candidates, assessments and other associated costs Total cost per hire = Supplier fee per hire + Internal cost per hire 7

9 Developing an Online Recruitment Strategy 8

10 To maximise the benefits of online recruitment, companies need to address four key questions Key Elements of an Online Recruitment Strategy 2 Which Suppliers? Which online recruitment sites are most appropriate for my needs? 1 Which Vacancies? Which of my vacancies are best filled through online recruitment? 3 Which Products? Which online recruitment products are most suitable for my needs? 4 What Organisational Model? How should my HR team and process be set up to use online recruitment effectively? 9

11 Vacancies suitable for recruiting online should be distinguished from others Segmentation of Vacancies Professional / Managerial Entry level / Very Junior Manual / Unskilled Examples Finance HR Marketing Engineering General Management Shop Assistant Receptionist Fresh graduate Labourer Driver Maid Candidate Presence Online High presence online High presence online Limited online presence Effectiveness of Online Screening Can be efficiently screened using online tools Hard to screen online, as core skills not in CV CV insufficient for screening, or no CV at all Overall Fit For Recruiting Online Ideal for sourcing and screening online Can be sourced online, but screening may still be time-consuming Unsuitable for recruiting online 10

12 The appropriate online recruitment sites can be selected based on objective criteria Supplier Selection Metrics for Evaluating Online Recruitment Sites Key Metrics Method of Evaluation Candidate Availability Candidate Quality Online Tools Customer Service Breakdown of candidate database (by location, industry, etc.) Size and freshness of CV database Quality of CV presentation Calibre of candidates Quality of search and filtering tools Simplicity and user-friendliness Responsiveness and professionalism Familiarity with the online products Request references from peers in other firms Review brochure and official statistics of the recruitment portal Request a free live demonstration of the site Purchase a short-term subscription to try out the service Monitor number of interviews and hires over a period of subscription 11

13 While most employers use both job posting and CV search, it is important to understand the benefits and limitations of each product Comparison of Online Recruitment Products Job Posting CV Database Search Candidate Types Reachable Only Active candidates (cannot reach those who do not apply) Both Active and Passive candidates (some of the best candidates are passive) Input Parameters Required Need a full job description to start Only need job title and/or key skills (no need for a full job description) Key HR Skills Required Ability to draft attractive job ads, filter and screen CVs Ability to do structured online search, and to approach candidates persuasively Time to Get Good CVs Days (should wait for candidates to apply) Minutes (proactively target desired candidates) Likelihood of Offer Acceptance Candidates very likely to accept (they show interest first) Candidates may or may not accept (need to be persuaded) Visibility and Branding Recruitment is publicly visible (ideal for building an employer brand) No public visibility or branding (can be good for confidential vacancies) 12

14 Most firms operate a centralised organisation for using online recruitment, giving access to the HR team only Organisational Model Centralised Key Features HR Team Online Recruitment Portal Line Manager Line managers communicate recruitment needs to the HR team HR team source and screen CVs online, and forward to line managers for review HR team follow up with approved candidates to arrange interviews Line managers do not have direct access to the site Common setup in the majority of companies 13

15 It is possible to adopt a distributed model, giving access to the line managers as well Organisational Model Distributed Key Features HR Team Line Manager Both the HR team and line managers have direct access to the site Line managers identify desired CVs directly and mark them for further follow-up by the HR team Access permissions to the site are controlled by the HR team e.g. who can post jobs, search CV database or view CVs online Used in a minority of firms, but adoption increasing Online Recruitment Portal 14

16 The choice of organisational model depends on the needs, priorities and resources of the company Comparison of Organisational Models for Recruiting Online Centralised Distributed Control & Standardisation Scalability Fully controlled access and compliance with standard procedures HR team needs to expand in line with the growth of recruitment needs Enforcing HR standards and procedures in dealing with candidates needs more effort and education Easy to scale up; a small HR team can support a large organisation Process Efficiency Knowledge Building Recruitment requires several exchanges between HR and line managers Central HR team can develop expertise in online recruitment Less communication overhead; line managers search and identify their target CVs directly Fragmented use may not allow deep online recruitment expertise to be accumulated Stakeholder Adoption The default setup in most companies; consistent with pre-internet boundaries Unpopular with some line managers. Can be offered on a voluntary opt-in basis 15

17 Appendix Analysis of Middle East Online Candidates 16

18 Many myths and misconceptions exist about online candidates Common Myths about Middle East Online Candidates Myths Reality * Fewer people go online, compared to those who read newspapers Job ads on a recruitment website do not get as much exposure as print ads in national newspapers Online candidates are mostly students and young people Only technical candidates can be found online Arabic speakers, especially Gulf nationals, do not look for jobs online The number of Internet users in the region is much higher than the total newspaper print circulation An online job ad typically receives over 400 applications, compared with around 200 for a print ad in a popular newspaper Half of the online candidates are aged over 30, and 37% hold managerial positions, including 8% who are in top management Online candidates span all industries and functions, with only 31% coming from IT and engineering roles Over 35% of online candidates are fluent Arabic speakers, including 8% who are Gulf nationals * Based on GulfTalent s database and analysis of publicly available data 17

19 Internet penetration has reached critical mass and now far exceeds newspaper print circulation across the region Online vs. Print Internet Penetration * Newspaper Circulation ** Total Population (millions, 2008 est.) UAE 49% 18% 5.6 Qatar 43% 15% 1.4 Lebanon 40% 10% 4.0 Bahrain 35% 17% 1.1 Kuwait 35% 27% 3.6 Saudi Arabia 23% 8% 24.9 Jordan 18% 5% Egypt 13% 6% Oman 10% 9% Sources: ITU, The World Factbook, Internet World Stats, Middle East Media Guide, Economist Intelligence Unit, GulfTalent Analysis * Number of Internet users as a percentage of total population. Based on 2007, the most recent year for which data is available ** Sum of print circulation of all daily newspapers as a percentage of total population. Based on claimed (unaudited) circulation figures for

20 Candidates found online have a higher level of education and better language skills than the general population Breakdown of Online Candidates * By Level of Education By Language 12% No University Degree English Only 10% Arabic & English 35% 88% 55% English & Other language 19

21 Online candidates include a significant proportion of mid-level and senior professionals Breakdown of Online Candidates * By Age By Seniority Above 50 6% Director / Executive 8% % Manager 29% % 22% 29% Experienced Professional Junior Professional 20% 34% Under 26 13% Fresh Graduate / Student 9% * Based on GulfTalent s database of 1 million candidates 20

22 Online candidates include a diverse talent pool from different locations Breakdown of Online Candidates * By Country of Residence Asia Other Europe / US 13% 12% 14% 4% 57% Middle East (excl. GCC) GCC ** * Based on GulfTalent s database of 1 million candidates ** Gulf Cooperation Council (GCC) countries include Saudi Arabia, Kuwait, Qatar, Bahrain, Oman and the United Arab Emirates 21

23 Candidates from all major industries and job categories can be found online Breakdown of Online Candidates * By Industry By Job Category Construction & Real Estate Banking & Finance 16% 18% Engineering Finance 14% 21% IT & Telecom Oil & Gas 8% 13% Sales & Customer Support IT 10% 13% Education Manufacturing 7% 6% Administration & Secretarial General Management 7% 6% Retail & Consumer Goods 6% Marketing and PR 6% Healthcare Marketing & Media Transport & Logistics Hospitality Government & Public Sector Recruitment Other 5% 5% 4% 3% 3% 1% 5% Education & Teaching Healthcare Human Resources Logistics Procurement Legal Other 6% 4% 4% 3% 2% 1% 3% * Based on GulfTalent s database of 1 million candidates 22

24 Glossary of Key Terms Online recruitment portal Job posting CV database search Active candidate Passive candidate Contingency recruitment Retained search An Internet website where employers advertise their vacancies and candidates register their CV to apply for those vacancies, or to be otherwise found by employers for potential job opportunities. A job advertisement placed online on a recruitment portal, allowing candidates to review and submit their applications directly to the employer advertising the vacancy. An online facility allowing employers direct access to the CV database of a recruitment portal, to search and find candidates with the desired profiles and to contact them directly without the involvement of an intermediary. Someone who is interested in changing employment and is actively searching and applying for vacancies. Someone who is potentially open to considering alternative employment opportunities, but is not actively searching and applying for vacancies. A type of recruitment service where the recruitment agent receives a fee only upon successful placement of a candidate. The employer typically works with several competing recruiters. A recruitment service where the agency is exclusively retained by an employer, with an upfront payment, to fill a particular vacancy. The agency typically uses a headhunting approach to target passive candidates. 23

25 About GulfTalent GulfTalent is the Middle East s leading online recruitment portal, with a database of over 1 million professionals covering all sectors and job categories. It serves as the primary source of both national and expatriate talent to over 2,000 employers and recruitment agencies across the region. Headquartered in Dubai, GulfTalent covers the markets of Saudi Arabia, Kuwait, Qatar, Bahrain, Oman, Egypt, Lebanon, Jordan and the United Arab Emirates. Further information is available at: Tel: Disclaimer & Copyright This document should be used for information purposes only. GulfTalent makes no claims or warranties regarding the accuracy or completeness of the information provided, and accepts no liability for any use made thereof. The recipient is solely responsible for the use of the information contained herein. GulfTalent.com All rights reserved. 24

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