Not all job hunters are the same. Some are actively looking for work, and others are just beginning to look for work. Some only think about looking for work. For others, the thought hasn’t yet crossed their minds.
Those not actively looking for work are called passive candidates. For companies that require top level talent, they’re a necessity.
Typically, passive candidates are employed and content with their current job. According to LinkedIn’s Talent Trends 2014 report, 80% of passive candidates are satisfied with their role, while only 52% of active candidates are satisfied theirs.
In many cases, passive candidates are the best candidates, yet only 61% of companies are recruiting them, according to LinkedIn’s 2015 Global Recruiting Trends Report. The other 39% are missing out, and here’s why.
Advantages of Recruiting Passive Candidates
Zappos, the popular online shoe and clothing shop, prides itself on recruiting the cream of the crop, and boasts a continuum of top talent in every department. Tech talent is no exception, but Zappos is based in Las Vegas, where the demand for Web developers and software engineers is much greater than the supply.
“Everyone is really struggling for technology people,” says Christa Foley, Senior HR Manager at Zappos. “When we’re competing from a tech candidate standpoint with the Bay Area and Seattle and Austin … we definitely have to seek passive candidates for those roles.”
In cases like Zappos’, recruiting passive candidates is a necessity because there are simply not enough qualified active candidates to choose from.
Focusing on passive candidates can also save companies significant man hours. Foley says when hiring active candidates, she has to spend a disproportionate amount of time weeding out the small handful who are qualified, fall into the desired salary range, and are willing to relocate. Passive candidates are preselected by recruiters, which helps bypass this drudgery.
Passive candidates typically make for better employees than active candidates. According to The Undercover Recruiter, passive talent are 120% more likely to want to make an impact and 33% more likely to want challenging work. Passive candidates aren’t as needy, and 17% less likely to require skill development.
Disadvantages of Recruiting Passive Candidates
While wading through a deluge of active candidate applications can be time consuming, so can scouring the Web for the perfect passive candidate.
“It can be more work and more effort and more time to attract someone who is a passive candidate,” Foley says.
Recruiters don’t have to convince active candidates to work for them; passive candidates need coaxing. Job postings don’t work on passive candidates. Aggressive sales tactics also fall flat. Recruiting passive candidates is about developing relationships, which takes time, energy, and resources. Despite the recruiter’s best efforts, it may not always produce the desired outcome.
Passive candidates typically have higher expectations and demands than active candidates. Since they hold more leverage, passive candidates might require a larger salary, more schedule flexibility, or further incentives than the company is willing to offer.
Furthermore, the process of searching for passive candidates is sometimes called “poaching,” and it’s not always viewed in the best of light. Your company doesn’t want to earn a reputation as a poacher.
How To Recruit Passive Candidates
Ninety-two percent of companies use social networks such as Twitter, Facebook and LinkedIn to recruit candidates, and for good reason. A quick tweet or post is highly shareable, and can reach a great number of people very quickly. Communicating via social media is also less formal than other communication avenues, such as email or advertisements. This informality is especially important when recruiting passive candidates, because it’s more conducive to relationship building.
To attract passive candidates, the recruitment team at Zappos likes to hold Q&A sessions through Twitter, which leads to an open dialogue. Participants in these sessions can learn more about the inner workings of Zappos, for instance, or find out what a day in the life is like for someone in a certain position.
Of course these Q&As are not only designated for job seekers, but they provide a fun opportunity to engage possible candidates, and establish meaningful relationships.
Of all the social media platforms, LinkedIn might be the most useful in passive candidate recruiting. With over 75% of fully-employed LinkedIn members not actively looking for work, the network is overflowing with passive candidates.
To leverage LinkedIn as a sourcing tool, employers should first build a company page and continuously update it with the latest company news and job opportunities. Recruiters can then connect with other Linkedin members they view as potential passive candidates. A benefit of being connected is you’re alerted to that person’s status updates. This comes in handy when a passive candidate uses a status update to announce that they left their job, or are currently exploring new opportunities.
Sometimes, the most effective recruiting is done by a company’s own employees.
According to a study by the Aberdeen Group, employee referrals are the most effective method of recruitment. A study conducted by Jobvite says employee referrals yield the highest application-to-hire conversion rate, and referral hires have greater job satisfaction and stay longer.
Employees will refer other candidates if one of two things happen: they are incentivized, or they are part of a strong company culture.
Employees at Zappos experience both.
Anyone at Zappos who successfully refers candidates can earn up to a $10,000 bonus. Zappos is also consistently ranked as one of the country’s best places to work, and maintains a worldwide reputation for having one of the strongest company cultures around. Without any prompting, employees are known to spread the word about how great it is to work at Zappos. Foley says this reputation plays a big role in the recruitment process.
“We really try to leverage our brand and our focus on company culture … certainly when someone’s a passive candidate.”
Create a Talent Pipeline
Landing a passive candidate is a slow, sometimes fragile process. The company’s need is greater than the candidate’s, so recruitment must be less about selling and more about developing relationships, fueling excitement, and whetting appetites for growth opportunities.
Because this can be so time consuming, it’s best to begin the recruiting process before a job opportunity becomes available.
To do this, recruiters should build a talent pipeline. A talent pipeline is a pool of potential candidates who may, either today or in the future, want to work for your company. When a job opportunity does become available, recruiters can sift through their talent pipeline for potential hires.
To build a talent pipeline, Zappos developed the Zappos Insider program.
Zappos Insiders are “are simply people who might want to work for Zappos someday.” As an Insider, you are kept abreast of the latest news and happenings. Insiders also gain exclusive access to online events and receive top consideration for job openings as soon as they become available.
Zappos Insider helps Zappos build a talent pipeline because it isn’t asking candidates to apply for a job. All it does is offer potential candidates an easy way to stay connected and engaged.
“Instead of having people apply to a particular job at Zappos, we ask them to apply to Zappos period,” Foley says.
Companies seeking top level talent should integrate passive candidates into their recruitment strategy. Passive-talent candidates are typically more qualified, and more likely to excel, at a highly skilled position than an active candidate. If the demand outweighs the supply, this is especially important.
When recruiting passive candidates, remember that relationship building is more effective than a direct sales approach, and leveraging social media, employee referrals, and a strong talent pipeline will increase your pool of passive candidates, and keep them engaged.