Traditional hiring methods are increasingly falling short. A staggering 80% of new hires fail within the first 18 months, and over 70% of startups struggle to hire quickly enough to meet their needs.
One strategy that many organizations overlook is internal recruiting. Internal promotions and lateral transfers not only serve as the top source of new hires for many companies but also play a crucial role in enhancing employee engagement, retention, and productivity.
A recent survey by SmartRecruiters, involving over 200 global Talent Acquisition (TA) professionals, revealed that only about 50% of employers have a dedicated strategy or standardized process for internal recruiting. Of those with established procedures, more than 75% reported that current employees often face more hurdles compared to external candidates due to additional eligibility requirements and mandatory approvals.
This oversight highlights a significant gap between hiring success and recruiting reality. With tightening headcounts and budgets, especially during crises like COVID-19, recruiters are being asked to do more with less. Many employers are turning to recruitment process automation, AI solutions, programmatic advertising, advanced sourcing tools, and other technologies to increase hiring efficiency.
However, when it comes to connecting people with jobs at scale, the key to hiring success often lies not in new platforms or products but in focusing on the most valuable talent pool of all—your existing employees.
If you’re among the 50% of employers without an internal recruiting strategy, or if you’re looking to improve your current internal mobility practices, now is the perfect time to start. Here’s how to build a business case for prioritizing internal recruiting and create a culture of talent mobility within your organization.
The Value of Internal Hiring
A recent LinkedIn study found that 69% of TA leaders link internal hiring to improved new hire productivity. Additionally, 63% of recruiters reported a faster hiring process, with significantly reduced time to fill positions.
More importantly, internal hires often receive higher scores from hiring managers compared to external candidates. They also tend to have higher job satisfaction and engagement levels, which are crucial for retaining talent. Internal candidates come with valuable institutional knowledge that can’t be found on the open market. This knowledge is a key asset that contributes to business continuity and bottom-line results.
Given the unique advantages of internal hires, such as their familiarity with company culture and processes, looking within before searching externally should become a standard practice. The best talent for your organization is often already employed there.
Beyond the Offer: The Importance of Internal Mobility
Many companies consider themselves “employers of choice,” but this is often more of a cliché than a reality. To gain a competitive advantage, transform this idea into a fundamental part of your company culture and employee value proposition.
Employees who have experience working in different departments or business units report higher loyalty and job satisfaction. Providing opportunities for internal mobility—whether through rotational programs or internal recruiting initiatives—makes employees feel more invested in their roles and the overall success of the organization.
Promoting internal mobility can also make hiring more manageable by reducing the need to constantly build and nurture external candidate pipelines. Internal promotions often require less experience and can simplify backfilling roles. Moreover, organizations with strong internal mobility practices generate more referrals, which are the top-performing source of external hires.
Despite this, many organizations spend only about 15% of their talent budget on internal recruiting and referrals. This is a missed opportunity that can be corrected by reallocating resources based on empirical evidence supporting the benefits of internal recruiting.
Building a Culture of Internal Recruiting
Building a culture of internal recruiting involves shared responsibilities among HR, managers, and employees. It starts with fostering a talent-sharing mindset and creating continuous development opportunities across various roles and projects within the organization.
Managers should have open discussions with their teams about future assignments and career paths. Transparency about hiring successes and challenges is also essential to align expectations with company needs. Employees should stay updated on their skillsets, embrace cross-training, and engage in cross-functional collaboration.
Learn More with SmartRecruiters
To explore how to turn internal recruiting into a competitive advantage, join our webinar, “Transforming Your Internal Recruiting Strategy,” recorded on May 4. Our expert panel, including Tracey Allison from Avery Dennison, Madeline Laurano of Aptitude Research, and Tony de Graaf from SmartRecruiters, will provide actionable tips and insights to enhance your internal recruiting strategy.
Watch the webinar on-demand for valuable takeaways and strategies to improve your talent mobility efforts.