Alexander Talbott - Executive Leadership Team

The Effectiveness of Job Boards
by Josh Woody, CPC (Nov 2003)

Now that the dust has settled from the debut of online job boards in the late 1990's, I'd like to take a look at the impact they have had on the staffing function of companies. Is e-cruiting and the use of job boards the silver bullet for cost-effective and efficient recruiting many claimed it to be after the launch of Monster.com in 1999? To the professional recruiter, e-cruiting encompasses more than simply job boards; however, for the purpose of this article I will be concentrating on the job board phenomena.

What prompted me to write on this topic was a conversation I had with the president of a local company last week. Early in the conversation I learned that he is a "major" stockholder in Monster and swears by the effectiveness of its services to staff positions in his small to medium-sized company. He couldn't understand how a professional recruiting firm could do a "better" job than Monster. I realized immediately there was no sense in trying to educate him on staffing metrics or the value associated with engaging a firm (either strategically or tactically) to handle a recruiting project full cycle. I gathered from the conversation that he saw no difference between Monster (which I think he labeled as an employment agency) and a recruiting firm. Needless to say, I politely wished him the best in growing the business and then ended the dialogue.

Over the past couple of years I've had a number of conversations with companies who utilize Monster as well as other job boards to simply advertise their jobs and then sit and wait for candidates. For certain positions, especially IT, they have gotten inundated with resumes. Due to the ease of electronic submissions, some companies receive upwards of 400 to 500 applicants for a single position. You have to wonder..

how motivated and ready are these people to join my company? (i.e. are they currently employed? If so, why do they want to leave? Are they being recruited by other companies?)
how many of these applicants are actually qualified for my position?
do any of these applicants have ulterior motives? (i.e. "I would just like to do this on a consulting basis", competitors probing for information, sales calls, etc..)

The only way for a hiring manager to find out is to thoroughly review all the resumes and make phone calls. Let's say XYZ Company is paying its IT Director $75,000 a year. That equates to roughly $36/hr. A loaded rate with payroll taxes, insurance, workman's comp, benefits, etc.. would probably be around $45/hr as a conservative estimate. Mr. or Mrs. IT Director wants to hire a web designer. Let's assume he receives 400 resumes from Monster applicants and he's able to screen the resumes and portfolios at a rate of 15 an hour. It would take him about 27 hours to just get through the initial screening process. The company has just paid its IT Director $1,215 to read resumes! In this scenario, there's no doubt in my mind that he can find a qualified candidate for the job by posting the position online, or even in the newspaper for that matter. There's no sense to utilize a search firm to actively locate a web designer in this market. However, I know many executives who would be extremely upset if they knew their managers were spending the company's money reading through 400 resumes.

Has that new car smell worn off?

I can understand the initial excitement surrounding online job boards. Hey.internet.world wide web...email.. this is cool! Now I can post a job and receive resumes in my inbox! Today, the technology has evolved to include all-inclusive human capital management systems. These are rather impressive. Really. For companies marketing these products, it's an easy sell. After all, isn't technology supposed to make all our lives easier? Have you ever heard any of these sales pitches before? "Your job will be cross-posted and distributed to all the job boards on our extensive network." "We have a national audience with thousands of active job seekers eager to view your jobs!" "Over 35 million registered job seekers! "Our proprietary technology will screen out unqualified candidates based on keywords and other criteria!" "Our website offers all the tools you'll need to streamline the recruiting process!"

What most of these companies fail to do is teach their customers how to best incorporate this technology into an overall strategic vision for recruiting, managing, and retaining their human capital. All too often, this technology in simply dropped in their lap and the task of tying it in to a forward-looking plan is up to them. From conversations with companies and candidates, I think the "newness effect" has begun to wane and is rapidly being replaced with frustration.

"The Internet has been a revolution in distribution, not production." - John Sumser, Electronic Recruiting News

I don't think anyone can argue with folks who claim online job boards are more efficient means of advertising jobs and managing respondents than print classifieds. In that respect, job boards are "nice". It's much easier to point-and-click than it is to open envelopes or stand by the fax machine. However, all the technology in the world doesn't hire people. One can't log-on to Monster and say, "Hey, I need an SAP administrator to start work next Monday," and then voila, a qualified gentleman walks through the door next Monday at 8am ready to start work. It doesn't happen that way. Online job boards basically function as a conduit for resumes from candidates who are actively searching and happen to come across your job. Further headaches occur when candidates set up what are known as "job hunters". These scripts actively seek out newly posted jobs based on keywords and other criteria. Many candidates automatically respond to these notices without exploring the position further to confirm they are qualified, thus adding to the pile on the hiring manager's desk.

Another drawback for advertising jobs (whether online or print) is the smaller candidate pool. You might be thinking how one can receive 400 resumes, yet it be considered a "small" pool of candidates. Let me clarify. Ninety-five percent of the labor force in Indiana is employed! Job boards won't bring a company the candidates who are diligently working for their current employer. These folks aren't perusing job boards because they haven't considered leaving their employer. These are typically the best candidates for our clients.

"The current economic downturn will do little to mitigate the long-term shortage of skilled workers. We cannot escape the demographics -- human capital challenges will only intensify in the coming years." - John Haley, Recruiting Industry Specialist

Don't get me wrong, the advertisement of jobs should play a role in a company's overall recruiting plan. However, all too often, companies approach posting a job online in a very narrow, tactical sense. There's a current pain in the form of a hiring need. Immediate relief is sought by posting on Monster. What is typically ignored is the underlying reason for the pain. This is where companies need to think strategically.

The unemployment rate is well below the historical average. In some professions, we are seeing close to full employment. Others are already experiencing a shortage of people. Most employers aren't aware of these trends because they're not in the job market everyday. In fact, some hiring managers with whom I speak don't understand why they only had 3 people respond to their job ad.

"Over the next 20 years, 76 million baby boomers are expected to retire. Only 46 million Gen X and Gen Y workers are scheduled to take their place." - Reader's Digest, July 2003

I tried to find a web page on Monster where I could punch in this scenario and receive a detailed report on how my company can best plan for this talent war. As I thought, I couldn't find such a service. . . .