You may be asking yourself whether recruiting software is too expensive for your small business. You may be telling yourself that a small business doesn’t need recruiting software, that a spreadsheet or old-fashioned brain power is all you need. Unfortunately, that’s almost 100% guaranteed to be wrong. It can be holding you back from achieving a better business with fewer headaches. Only businesses who do virtually no hiring would not benefit from recruiting software. For most, the benefits far outweigh any costs, if there are any costs. Some recruiting software, like Recruiteze, is even free.
Is Recruiting Software Too Expensive?
How Much Does Recruiting Software Cost?
Well, first there are many different kinds of recruiting software. Any software intended to solve problems involved in hiring is technically recruiting software.
Recruiting software includes social media aggregators that search social media for potential candidates, resume spiders that find resumes all over the Internet, interviewing software, candidate relationship management systems(CRMs), and applicant tracking systems(ATSs). CRMs and ATSs are the most popular, and what people usually mean when they discuss recruiting software.
Vendors of recruiting software understand that small businesses have different needs than large companies, so many of them have created recruiting solutions specifically for these different demands. This includes affordable pricing, monthly billing rather than contracts, and even free software.
PriceItHere says, “recruitment software costs range from $42 to $995 a month.”
But Recruiteze offers a free version of our ATS as well as $9.95 and $39.95 versions. There are also free CRMS and ones starting as low as $10.
The most important thing to consider about the cost of recruiting software is how much money you will save and gain by using it. This is definitely an example of a product or service more than paying for itself.
Does Recruiting Software Fit Into Your Budget?
Bersin by Deloitte discovered that $4,000 is the average cost per hire. That is steep. Most businesses waste a lot of money on hiring through inefficient hiring processes and high turnover.
To determine how recruiting software fits into your business’ budget, you need to discover how much money you are currently spending on hiring. It can be a bit difficult as there are so many places money goes during the hiring process, often into things you completely forget about when you thinking about hiring.
Recruitment costs include:
- job advertisements
- sourcing time
- time spent reading resumes
- time spent entering resumes into spreadsheets
- loss of productivity while waiting to fill a position
- job board fees
- payments for background checks
- time spent interviewing
- cost of hiring new employees due to high turnover
- training costs
- recruiter fees
- and much more
In a previous post on resume parsing, we discussed wasted time. “On average, a job posting receives 250 job applications. That means it takes 2500 minutes to add the candidates for each job. This amounts to 42 hours, or a week’s worth of time, to just add the candidates to the database.”
Score.org found that HR activities cost small business owners 25-35% of their valuable time. Recruiting software cuts out unnecessary time-wasting activities to save time and money and helps make what time you do spend hiring much more effective so you end up with better hires.
You should create benchmarks to see how much you’re currently spending on hiring, breaking down your costs into their many areas, to make sure you aren’t spending way more than is necessary.
Recruiting software offers reporting and analytic functions that help you create benchmarks and effective hiring goals for a wide range of metrics, including time-to-hire, candidates interviewed versus candidates hired, and more. These reports can be seen in various formats such as the day, week, month, or year for easy comparison. Without reports and analytics, it could take exponentially longer to reach your goals as you’re pretty much taking a stab in the dark.
You could get a free applicant tracking system or CRM and use its analytic functions to help you build your initial benchmarks. It’s a valuable opportunity to see what to track and how to track it, if you’ve never done it before or found your results sorely lacking. If you like the free software, keep it. If not, you’ve discovered what recruiting software you can afford to try in its place.
Cost Savings of Using Recruiting Software
Recruiting software automates functions that waste hiring managers’ time and provides organizational tools to make other tasks more efficient. Time is money, and gained time is an opportunity to get creative and strategic.
Depending on the software, recruiting software saves small businesses money by:
- Sourcing candidates from the Internet and social media
- Posting to multiple job boards in an instant
- Instantly sending appropriate candidates to the right hiring manager
- Connecting past and current applicants to the right job
- Helping you to quickly search the database rather than physically look through resumes
- Keeping notes, resumes, test stores, etc. with the candidate’s resume for quick retrieval
- Instantly parsing (uploading and making searchable) resumes
- Instantly formatting resumes for easy reading and sending
- Screening candidates for you
- Sending automatic emails to notify them of the next step in the hiring process, request an interview, and reject candidates.
- Eliminating catch up time as one manager learns where another was at or how they hire
- Letting you interview by video rather than schedule (and pay for) in-person interviews
- Improving compliance
- Protecting your business from catastrophic data loss or hacking
How many of these things do you grumble about wasting time on?
Time to hire alone is straightjacketing many small businesses. It simply takes them too long to hire a new candidate, potentially losing candidates along the way, wasting money on an inefficient hiring process, and missing out on the productivity that would be achieved if the spot were filled. The automated functions and organizing opportunities gained from recruiting software could drastically reduce time-to-hire.
Some applicant tracking systems have a workflow feature that helps you see the stage candidates are in within the hiring process. This way no candidates get forgotten about and you don’t end up doing steps over, both wasting time and giving your business an unprofessional image. Many candidates complain that recruiters send the same message over and over.
Recruiting software can also help with onboarding, which is an essential part of reducing turnover. Onboarding starts with effective employer branding from the start, through your job ads, your career portal, and the way you communicate with employees. Branding is not a function of the recruiting software exactly, but it is a byproduct of all the time saved, if you choose to exercise it. When you aren’t wasting time on mindless tasks, you can give more strategic thought to employer branding and candidate experience. After that, you will have need to have an effective strategy in place for ensuring candidates are introduced to and helped to grow accustomed to all the aspects of their job from what is expected of them to the ins and outs of the company culture. Some recruiting software has features to help you get your onboarding initiatives organized.
Small businesses have considerably higher compliance costs, 60% higher. Recruiting software helps with this issue, making many compliance and discrimination issues moot and guiding you through other aspects, depending on the software. The first and most obvious solution any recruiting software offers is that the entire process is backed up, so it can be proven. It’s hard to question whether a human made a prejudiced or inappropriate decision when there is hard proof that they didn’t. It also eliminates many opportunities for the human mind to be guilty of unconscious bias. Where a candidate might be overlooked at a stage in the hiring process, they might make it much farther and be less likely to be overlooked when recruiting software recommends them and moves them through to a higher priority stage.
How to Ensure You’ll Get a Good ROI in Recruiting Software?
- Determine your hiring pain points and prioritize recruiting software with features that primarily solve those pain points.
- Don’t assume recruiting software is better than a human or will magically be perfect; it requires maintenance, strategy, and some good old human insight to perform as intended.
- Use time gained from employing recruiting software to plan a better overall hiring process.
You came here to answer the question of whether recruiting software is too expensive. Small business recruiting software is not expensive, because it is tailored to small businesses. Whether a particular recruiting software fits your budget depends on your current hiring costs and how you balance the cost versus the gains. It’s going to make you more money than you spend. Some recruiting software is even free. So it’s all gain either way. Ensure you make a good return on your investment by determining your hiring pain points before choosing recruiting software and using the time you save from your recruiting software to improve your hiring process overall.
The Best Free Recruiting Software For Small Businesses! |Recruiteze
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