The Whisper of Employee Referrals

According to Nielsen, 92% of consumers believe recommendations from friends and family over all forms of advertising. Whoa!

Let’s take that proven power of word-of-mouth, and see how it relates to the employee referral and hiring process. It’s one thing to take someone’s advice on a product or service. It’s another level of required trust when it comes to taking a referral in regards to job opportunities and working conditions.

As an employer, one of the best opportunities you have to hire good people is through your current workforce. Your team knows the daily ins-and-outs of the company, they understand the culture, and they know better than anyone how they are treated.


In recent surveys, it was found that 60% of employees have referred at least one person to an open position within the company, and 38% of employees have referred multiple candidates for open jobs.

A candidate has a better chance of landing a job with a company when referred by a current employee. The higher up the employee is, the better chance of the candidate being hired. In fact, when a candidate was referred by a director-level or higher, they were hired 91% of the time.

Combine these stats with studies showing that 65% of referred employees were very satisfied with job fit or their ability to fulfill the requirements of the position, while referrals are #1 in average length of employment of all initial hires after one year, with a 46% retention rate (Jobvite Index). This adds up to a tremendous upside to employee referrals for a potential new hire.


Most employees aren’t going to put their names on the line for someone who may be a friend, but they know won’t fit into the company, either from a talent or culture perspective. More often than not, an employer can be more confident when an employee refers a potential candidate, because the employee knows both the company, and the candidate, and the employee wants to protect the value of their opinion.


Glassdoor has opened up the conversation between companies, their employees, and potential candidates. The resounding effect of the conversation has been the creation of transparency in the working conditions of companies around the world. A powerful resource for all parties involved, the site epitomizes the current reality of our society that shares experience online, contributing to the continued phenomenon of word-of-mouth.

With the progression of social media, the “noise” seems to only have gotten louder as more products, services, and job opportunities flood the marketplace. The challenge for consumers is sorting through all the “opportunities” that are out there, while employers and businesses are desperate to cut-through the noise so their “voice” can be heard. With the massive growth of work-from-home, freelancing, and remote work rushing through the marketplace, HR personnel work tirelessly to find, hire, and retain top talent.


Sometimes in all the noise, the thing that is heard best is a whisper. An employee referral can be that whisper. It’s personal, it’s intimate, and it’s knowledgeable. Some would say that an employee referral is more cost effective because it’s free. The literal referral may not cost any money to produce, but the amount of time, money, and effort put into creating a company culture worthy of a great referral can be quite expensive…but it’s worth it.


Negative referrals can eventually cripple your ability to hire good talent in the future. Negative feedback is likely to reach twice as many ears as praise for a good experience does, and in human psychology, it takes an average of 12 good responses to negate 1 negative. It’s only human nature for an exasperated employee to vent about poor working conditions, weak leadership, or lack of direction. Put these types of comments on repeat, and potential candidates see the pattern, and look elsewhere for their job opportunity. Additionally, if the reality of your culture is a negative experience, your employees won’t refer potentially great candidates. The result is a company that is left fighting to cleanup it’s brand image (if it cares about it or recognizes the situation), and even more money being spent trying to find new employees.


Top producing companies known for great culture begin their assimilation processes before day 1 with a new employee. By carefully crafting an ongoing system to immerse employees into the culture, they are able to build a relationship that leads to higher employee engagement and retention. Great systems and processes don’t end after new hire onboarding, but continue throughout the entire time of employment of the employee. This helps employers facilitate ongoing conversations that assist in the development of the employee’s career, as well as for the further growth of the company’s workforce. The development of employee relationships can bring confidence to ask, “Do you know anyone who would be a good fit for “this” position?”

In a world with so many options and competing voices, people trust their friends and family to guide them in everything from products to jobs. Work to create a culture within your company that evokes great referrals from your employees, and watch your business grow. Your company will become known as a great place to work, and you will be able to find top talent to take you to the next level.