How to Cultivate Referrals From Rejected Candidates

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Mar 8, 2022

Employee referrals are a cornerstone of any sound talent acquisition strategy, especially when upwards of 20%+ of your hires come from referrals. But what about candidate referrals, those made by individuals in your talent pipeline who don’t even get hired?

Like employee referrals, candidate referrals can be an effective source for tapping into passive job seekers. In the current talent market, where the competition for qualified workers is tougher than ever, the value of candidate referrals can be invaluable.

The question is: What inspires candidates to refer qualified colleagues and friends to you, particularly when you’re not offering cash incentives (as is often the case with employee referrals) and you will have rejected most of these candidates, possibly even before they’ve made a referral?

The answer is: a respectful, high-quality candidate experience.

How To Cultivate Candidate Referrals

Make no mistake — your jobs and your company (its mission, culture, and reputation) are the primary drivers of referrals. Your candidate experience, however, is close behind when it comes to motivating people in your talent pipeline to refer others. The more positive the experience you provide, the more likely candidates are to make referrals.

Talent Board has been researching the candidate experience for more than a decade, and the data consistently shows that when employers provide positive experiences, candidates are significantly more willing to increase their relationships in all sorts of ways. That includes applying to their jobs in the future, purchasing their products or services, and influencing the opinions and purchases of others — even when they’ve been turned down for a job. That’s a pretty nifty set of outcomes for providing positive candidate experiences.

As for their willingness to make referrals, among all of the thousands of candidates who participate in Talent Board’s annual benchmark research, each year roughly 30% say they’re extremely likely to refer others as a result of positive candidate experiences. Here’s the remarkable part: Nearly 90% of these individuals are rejected for the jobs they applied to. That’s how powerful a positive candidate experience can be.

Talent Board’s latest research reveals several key actions you can take at various stages of the candidate experience to generate referrals. These include:

Being transparent about salary as early in the candidate experience as possible. Pay transparency is a hot topic right now, as it should be. Research has shown that when pay transparency is lacking, employees are 50% more likely to leave their company, and hiring new talent becomes exponentially harder because nearly two-thirds of the country’s adults say that salary is one of their most important decision-making factors when looking for a new job. 

Eight states have already passed pay transparency laws, and a growing number are considering doing the same. Legalities aside, Talent Board’s research shows that when candidates were told about a job’s salary without having to ask, their likelihood to refer others increased a whopping 132%. Sharing salary information in job descriptions, on company careers sites, during the application process, and during interviews are all becoming more common — and the earlier in the recruiting process the better, as salary is a deciding factor in whether many individuals will even consider a job. 

Giving and asking for feedback at the interview stage. When employers gave specific feedback to candidates, candidates’ willingness to refer others increased by 24%. And when employers solicited feedback from candidates after an interview, candidates were 74% more likely to refer others.

Keeping candidates informed post-interview. Unfortunately, too many employers stumble on the timeliness and clarity of their communication with candidates after holding interviews. This is a shame because candidates’ willingness to refer others was 78% higher when they were kept apprised of their status and given clear information about their potential job fit following their interviews. Additionally, when candidates were given any information about next steps and were followed up with consistently by the recruiter/HR professional, their willingness to refer others increased 68%.

Making a timely job offer. Time is always a crucial factor in recruiting, especially in today’s highly competitive talent market. An employer that is slow to make an offer to a desirable candidate risks losing that person to a nimbler competitor. If you make a job offer within one week of a final interview, data shows that your candidate’s willingness to refer others increases 79%.

One additional point: Improving your candidate communications will also help to generate referrals. This includes improving the frequency with which you reach out to candidates, the speed with which you answer their questions and respond to inquiries, the amount of honest feedback you provide, your use of chatbots and other AI-based smart technologies, and the degree to which you share details about your company’s mission, culture, and work environment.

The importance of communication was highlighted by one of the case studies in our 2021 research. Professional services provider, Stantec Inc., made a concerted effort last year to improve its communication touchpoints “by reaching out to candidates more often, taking an empathetic approach in interactions, and being as transparent as possible with feedback throughout the hiring process.” As a result, the percentage of candidates who said they were likely or extremely likely to refer others to Stantec rose from 82% to 88%.

Activate Your Candidate Referrals

Remember that the candidates who touch some part of your recruiting process very likely outnumber your employee population by a wide margin. So, the volume of candidate referrals you earn could be huge in comparison. Granted, a significant portion of those referrals may not bring you qualified or high-value talent. But given the stark realities of the current talent market — and the talent losses so many employers are now contending with — you’d be rash to ignore the potential benefits of earning more candidate referrals.

If you have an employee referral program, it basically turns your employees into recruiters. A quality candidate experience does the same thing but with your candidates — people who’ve touched some part of your talent attraction process and are motivated or inspired by it. When you think about the sheer numbers of those individuals, that’s an awful lot of potential recruiters who could be out there advocating for your employment brand.