What gives software for recruiting in money
For more than 10 years, there are various kinds of professional systems for staff recruitment. It `s naturally. Specialized software has already been developed for many individual professions. As for recruiting, everyone understands what tasks software helps to solve, what routine and mistakes it eliminates, but no one understands how to measure the economic effect of its use. In other words, companies can calculate how much money they will use software, but do not understand the ROI or how much money will bring or save software. Slogans like “Close vacancies 2 times faster with (such software)” are from a flashlight, this is simply not true.
Failure to understand what software provides for recruiting in money leads to the fact that companies postpone this investment for years and during this time they lose a lot in results.
I decided to calculate how much money and time professional software for recruiting staff saves. In order not to overload you with detailed calculations, I will start right away with the results. And who is interested in digging deeper, detailed calculations are described below.
So, here are my results.
Using professional software for staff recruitment you:
- Save 20% of your hiring time or 2.4 months per year for each recruiter.
- save money - equivalent to 2.4 average recruiter salary per year . In April 2019, this is an average of $ 2,880 for an IT recruiter in Russia, $ 2,040 for Ukraine, $ 1,800 for Belarus, $ 1,320 for Kazakhstan.
- ROI with investments in software for recruiting about 325% .
- 〜 The recruiter will be able to close every 5 vacancies with the help of his base, which is 54% faster than when searching for new candidates.
Sit back and get down to detailed calculations. I decided to analyze the selection of personnel “on the bones” in order to get a clear idea of what and in what volumes the recruiter has to do.
How software helps save 20% of the time
An average recruiter spends about 33 hours on processing 1 vacancy without using software. It was not easy to count. We interviewed colleagues, and also analyzed in detail the norms and standards in the profession.
To hire a qualified employee for an office position, you need to perform a certain list of actions, while some of them are one-time, while others need to be done daily. In most cases, it is possible to close a standard vacancy, if you actively engage in it, from 10 days to 3 weeks. For calculation, we take the average value: 15.5 days. This value will be multiplied by all daily labor. We take the duration and number of individual actions from the standards established by experts empirically (for example, like here). For all calculations, we use the arithmetic mean of the minimum and maximum values - it is most close to real conditions with the probability of a variety of emergency situations.
Let's compare the time costs of one recruiter for each selection stage without software and using software, and calculate the real savings.
If we add up the duration of all the individual elements of the recruiting process (calculated by average values), it turns out that the hiring specialist spends almost 32 hours 48 minutes on the “manual” selection of one employee. Having considered the time required to close the same vacancy, but using the capabilities of the system for recruiting, the time for all necessary tasks was reduced to 28 hours and 24 minutes. That is, the closure of 1 vacancy is accelerated by 4.4 hours.
According to statistics, a recruiter processes an average of 5 vacancies per month. Using software at the same time, he gets a very valuable bonus - this is the “pumped” internal database of the resume. Of course, closing vacancies from the internal base is much faster, this is a dream. I decided to find out how much such accelerated hiring is and how much time.
To do this, we got data on closed vacancies in the CleverStaff system for 2 years. It turned out that on average 4 out of 5 hires are new candidates, and every fifth employee hired is a candidate from the internal base, and such vacancies are closed 54% faster. On average, there is a saving of 4.4 hours not received earlier, but already 17.7 hours.
Move on. If the specialist works standard 176 hours per month, then the total saving of working time is:
(4 vacancies × 4.4 hours) + (1 vacancy × 17.7 hours) = 35.3 hours per month.
35.3 hours of savings / 176 working hours per month = 20% of working time per month.
On a yearly basis, this is:
20% × 12 months = 2.4 months.
This indicator is universal and applicable to the work of a recruiter in any country and with vacancies of any complexity. Let's see: what causes this reduction?
This is possible due to the fact that professional software optimizes such time-consuming processes:
- Publication of the vacancy - the system itself forms the external page of the vacancy from the data entered into the database. If you add to the text of the vacancy posted on a special resource, a link to the external vacancy page generated by the software, applicants will be able to respond to the vacancy directly on it, which is convenient, because the responses immediately get into the system, and their resume - into the database.
- Saving all suitable resumes from the database of job search site candidates. Professional systems have integration with the most popular employment platforms, which means that users can add candidates from these resources to their own database in 1 click, i.e. right in the process of screening search results.
- Saving resumes of applicants who come daily to e-mail and to accounts on job placement platforms. Parsing resumes from mail is done once a day. If you add a link to the external page of the vacancy generated by the system in the job description on third-party sites, the candidates will be able to send their feedback from it, i.e. immediately add to the database and appear in vacancies at the “Found” stage.
- Notice of rejection to unsuitable candidates. Using software, this can be done directly from the system interface: the system itself will substitute the name of the candidate in the template.
- But the main thing is the formation of a working base of candidates, due to which an experienced recruiter will be able to close vacancies without external sources.
How much is the money?
Everything related to financial indicators can vary significantly. The salary of both the recruiter and the candidate he is looking for depends on the country, the size of the company, and the budget of the department. Therefore, here I turned to the averaged indicators, which are usually found in professional studies. So, according to statistics, the average salary of a Russian IT recruiter per month is $ 1,200. In turn, the average salary of a Ukrainian IT recruiter per month is $ 850 (according to EvoTalents ), Belarusian - $ 750, and Kazakh - $ 550. Hereinafter, I took all the data on the size of wages from public vacancies on such resources as hh.ru, hh.kz and the like.
I correlated this indicator with the saving of working time - 2.4 months per year, which we received earlier.
- For Russia - $ 1200 × 2.4 months = $ 2,880
- For Ukraine - $ 2040
- For Belarus - $ 1 800
- For Kazakhstan - $ 1,320
These amounts are the average savings on the salary of each recruiter per year. To be more precise, for such an amount the recruiter does additional work if he uses a professional system.
Does your company need recruiting software?
This is a purely business matter. It is better to make decisions not intuitively or emotionally, but based on data. I propose using an example to calculate the amount of benefits from implementing software for a team of 5 recruiters with salaries of $ 850 each.
For example, software costs $ 40 per month for each recruiter. This is quite a market option.
For a month, software costs are 40 × 5 = $ 200.
As we calculated above, professional software will save 20% of the time. For a team of 5 recruiters, you get a savings of exactly 1 month of work, which costs $ 850. The cost of such savings is the cost of software ($ 200 in our example), so the net savings will be 850 - 200 = $ 650.
In fact, 1 month of recruiter working time savings for our company means one of the following scenarios:
- 5 recruiters cover more vacancies, as if they were assisted by the 6th recruiter.
- The load of each recruiter is reduced and 4 recruiters are enough for you, instead of 5.
ROI = Amount of savings / investment amount (software costs) = 650/200 × 100% = 325%.
Simply put, in our example, investments in software will be repulsed 3 times in 1 year.
For your company, you can repeat my simple calculations by substituting:
- Your number of recruiters,
- Their monthly payroll,
- The amount of costs for your recruiting software,
- The average time for closing a vacancy in your company.
In my estimation, for different values of these variables, the ROI can be in the range from 240% to 410%.
You can also estimate the value of hired employees for 2.4 months by each recruiter in the added value that these employees created. According to my calculations, this increases the ROI even up to 2.5 times.
Using professional software by recruiters is no longer a contentious issue or a dilemma. This is a global trend that will include all major companies sooner or later.
I hope that my calculations and results will help your companies decide on professional software for recruiting and it will pay off for you no less than in my calculations :)