Social Recruiting Via the Crowd

It used to be that corporations would pay employees referral bonuses when they recommended friends for jobs. The higher the position on the corporate ladder, the larger the bonus. Workers were obviously motivated to refer the right people given that it was their reputation on the line if the hire didn’t pan out.

That was in the ’90s.

Today, a start-up called Jobhuk is putting a twist on this concept, using the wisdom of the crowd to recruit smart.  You (as part of the crowd) explore the jobs on the site, and then refer a candidate easily via LinkedIn, Facebook, Twitter or just email.  You have to make sure your referral applies for the job.  If your referral is hired and stays on the job for 60 days, you get your finder’s fee, anywhere from 1 to 15 percent of the candidate’s gross salary. Anyone in the crowd can nominate potential applicants.

The idea is that Jobhuk is saving the corporation a typical recruiting firm’s commission. Most folks will be motivated to refer people who would be a good fit – and thus get hired – so they can earn the finder’s fee. The onus of interviewing and making sure the candidate is suitable is up to the company. Questions do remain on what would happen if people try to scam the system i.e.  the worker quits after 65 days. Those issues are being worked on by the Jobhuk team.

But Jobhuk founder Praneeth Patlola is confident that this model is here to stay. He believes that the lower costs of finding workers who come recommended, without using a staffing firm, has its advantages. He is planning on adding independent contractors to the mix. In that service, the crowd would refer independent contractors and the member of the crowd whose contractor is picked would receive a percentage of the contractors’ rate for each hour worked. The percentage could be around 10 percent.

More companies like JobPrize.com, SL8Z.com (soon to come) and Refer.me (in Hong Kong only) are tapping the crowds’ knowledge for recruiting.  A bad hire costs your company significantly in terms of time, money, loss of productivity, morale etc.

Harnessing the social power of the crowd maybe a way of getting it right.

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Tiny Work

Seth Weinstein 10/04/2013 1:22 pm

Pretty smart idea, in my opinion. The crowd is much better at predicting efficacy when their own money is on the line. It's the difference between, for example, asking someone who they want to win an Oscar or who they THINK will win the Oscar. You're much more likely to get an accurate answer from the latter query as it forces the respondent to consider the weight of the full crowd's opinion and not just their own.


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