As the economy rebounds, it's time to think about hiring. Here's how to get back valuable staffers who fell casualty to layoffs.
It's no secret that the past few years have been rampant with cutbacks and layoffs. As businesses are slowly beginning to rebound, however, it might be time to consider re-staffing. There's no recruitment method more cost- or time-efficient than rehiring reliable former employees.
Some businesses call them alumni. Some call them boomerangs, but almost all businesses will admit that rehiring top performers can drastically increase their return on investment.
According to a 2009 Career Builder survey of 2,924 hiring managers, 26 percent of employers who had laid people off in recent years were planning on bringing some of those layoff casualties back. The majority reported that 2010 would be the year they'd extend those return offers.
"We've seen a huge uptick in companies bringing people back," says Anne Berkowitch, CEO of SelectMinds. Her company's mission is to teach businesses how to cut back on recruiting costs by helping employers network with former employees and referral candidates. "Companies are more open to that than they were five years ago, let alone 10 years ago or more."
Rehiring Former Employees: The Case for Rehiring
Berkowitch says there are several crucial reasons why businesses should consider rehiring. The first is that the cost-per-hire is typically decreased. You already know the candidate, so you don't have to worry about hiring a third party recruiter.
"It's a much more informed decision on both parts," she says. "The alum knows the company. The company knows the alum, so the hiring decision is made with a lot more information than what is captured on a resume."
Because the returning recruit already knows what she or he is signing up for, Berkowitch says the retention rate is also significantly higher. Former employees who have left the company and want to come back have likely seen that the grass isn't always greener on the other side. Even if their departure from the company wasn't voluntary, they're already familiar with both the corporate culture and the job description. In fact they are less likely to leave once they've been brought back.
Another key factor in considering bringing back a former employee is that the on-boarding process is much quicker. In fact, Berkowitch says her clients have reported that "time to contribution" for rehires is half that of external recruits.
"They hit productivity a lot faster," she says, meaning the company itself will save time and money that would have gone into training.
On average, Berkowitch reports that companies can save around $15,000 to $20,000 per rehire. "What that captures is lower cost-per-hire, faster productivity and retention rate," she says.
Not only can it save money, but it may also help you with business development, as former employees who have spent time away from your company have typically acquired new skill sets and contacts over that time. Dr. John Sullivan, a professor of management at San Francisco State University, says: "Having worked for a competitor can be worth a lot."
Dig Deeper: The Real Cost of Layoffs
Rehiring Former Employees: Be Selective
Just because rehiring sounds attractive, that doesn't mean you can bring anyone back successfully. Rehires should be given as much thought and consideration as external hires. The most important thing to remember, according to Sullivan, is: "You don't ask everyone back. You ask the top performers."
The consulting firm Booz Allen Hamilton, which is headquartered in McLean, Virginia, is well known for its successful rehiring program. Booz Allen associate Justine Yingling says alumni can log onto the company's website and apply to be what they call a "Comeback Kid." Or they can apply for a targeted position through one of their recruiters. Either way, they will go through the Comeback Kids' rigorous evaluation process, in which the human resources, legal, and compliance teams determine whether or not a candidate will be effective when he or she returns.
"We review their personnel file and make sure there's no history where we'd be concerned about bringing them back to the firm," Yingling says. Such history could include whether or not someone left in good standing and if someone was terminated for a cause.
