2020 Employee Referral Programs Benchmark Report

1 2020 Employee Referral Programs Benchmark Report Analyzing Referral Programs of 200+ companies Copyright Drafted, Inc 2021 Table of Contents 2. Table of Contents Rewards and Referrals Overview 3. Why this Report Matters 16. Rewards 4. About the Report 17. Rewards and Extra Perks 5. Key Takeaways 18. Hot Jobs Bonus 19. Reward Restrictions Respondents 20. Referral Rewards and Hires 6. Respondents by Sector 7. Respondents by Company Size External Referral Programs 8. Respondents by Years in Business 21. External Referral Programs Applicant Tracking Systems Demographics and Referrals 9. Applicant Tracking Systems (ATS) Breakdown 22. Company Size and Referrals 10. ATS Small Companies 23. Company Age and Referrals 11. ATS Growth Stage Companies 12. ATS Midsize Enterprise Summary 13 ATS Large Enterprise 24.

2 Recap of Key Takeaways 14. ATS and Referrals 25. Recommendations from Drafted 26. Additional Resources Hires from Referrals 27. About Drafted 15. Hires from Referrals 28. Join the 2021 Report Copyright Drafted, Inc 2021 2. Why This Report Matters Referrals have been a way to expand your network and recruit great people since the dawn of time. Seriously. If we look back all the way to 55 the rst ever Referral program' was created by Julius Caesar who signed a decree offering 300. sestertii to any soldier that recruited someone to join the Roman Army*. 88% of employers say that referrals is the most effective way to hire, while 70% of employers agree that referrals also make a great culture t. 45% of referred hires stay more than 2. years, which is more than any other source of hire.

3 *Source Link: Copyright Drafted, Inc 2021 3. About The Referral Programs Benchmark Report This is the second Employee Referral Programs Benchmark Report from Drafted. We published the rst one in 2017, which you can get here. Our mission was to establish a baseline for Employee Referral Programs , and share what we learn from our community of recruiting and talent teams. Copyright Drafted, Inc 2021 4. Key Takeaways The choice of an Applicant Tracking System has minimal impact on Referral hiring success. The average percentage of hires from referrals is 27%, with 44% being one standard deviation above. In other words, if you're at 44% hires through referrals, you're doing an A+ job. Most companies opt for a simple cash reward with a median Referral reward $2,000.

4 50% of the companies offering a Referral reward also offer a hot job bonus for hard-to- ll or urgent roles. Referrals are the most popular hiring source for companies independent of company size and age. Emerging trends include external Referral Programs and experiential non-cash rewards. Copyright Drafted, Inc 2021 5. Respondents by Sector We collected data 200+ organizations, just over half were technology companies Copyright Drafted, Inc 2021 6. Respondents by Company Size Most of the companies were privately held, and we split them into small (<100), growth (101 - 500), mid-size (500-1000) and large companies (1000+ employees). Copyright Drafted, Inc 2021 7. Respondents by Years in Business The median age of companies was 10 years, with a small number of outliers.

5 Median age: years Copyright Drafted, Inc 2021 8. Applicant Tracking Systems (ATS). 40% of respondents used Greenhouse while Lever was the second most reported with 17%. We will note that this is a skewed sample and biased toward our ATS partners. Copyright Drafted, Inc 2021 9. ATS Breakdown for Small Companies (0 - 100 employees). Roughly 36% of small companies reported to not use an ATS or were unclear on which one they use. Copyright Drafted, Inc 2021 10. ATS Breakdown for Growth Companies (101 - 500 employees). Roughly 60% of companies in the growth stage reported to use Greenhouse as their ATS. Copyright Drafted, Inc 2021 11. ATS Breakdown for Midsize Enterprise (501 - 1000 employees). Roughly 47% of midsize companies reported to use Greenhouse as their ATS.

6 Copyright Drafted, Inc 2021 12. ATS Breakdown for Large Enterprise (1000+ employees). Large companies had the most diversity in choice of ATS. The majority, roughly 30%, reported to use Greenhouse as their ATS. Copyright Drafted, Inc 2021 13. ATS and Referrals This graph shows median Referral hiring rate reported by companies, categorized by Applicant Tracking System (ATS). There is no conclusive evidence that the choice of ATS affects the effectiveness of Employee Referral Programs . Copyright Drafted, Inc 2021 14. Hires from Referrals On average, 27% of hires came through referrals and 44% was one standard deviation above. In other words, if you ll 27% of your positions through referrals, that's a B+. If you ll 44% or more, that's an A+. Less than 20%. 21% to 40%.

7 More than 40%. Copyright Drafted, Inc 2021 15. Rewards Over 80% of the companies that reported a reward offered a cold hard cash reward for a successful hire. The median Referral reward reported is $2,000. Copyright Drafted, Inc 2021 16. Reward Types and Extra Perks 13% of the companies offered an experience, gift, or donation as a reward. This is a cool way to express your company values and culture through your Referral program. Copyright Drafted, Inc 2021 17. Hot Job Bonus 50% of companies offering a Referral reward included a hot job bonus or reward increase based on hiring position seniority. Majority of hot job bonuses were focused on acquiring tech and engineering roles and most companies scaled the bonus level depending on seniority of the position.

8 The most popular maximum bonus was $5,000 with the highest reported hot job bonus being $30,000. Copyright Drafted, Inc 2021 18. Reward Restrictions Majority of companies have a probationary period before the Referral reward is paid out 60% of the companies that offered a Referral reward have some sort of terms and conditions. Out of the companies with reward restrictions over 90% included a probationary period ranging from 30. to 180 days. This has become, similar to agency recruiting, an industry standard. Copyright Drafted, Inc 2021 19. Referrals Rewards and Hires Data indicates that between $3,000 - $5,000 is the sweet spot for getting the most for your dollar. As you increase your bonus above $5,000 you may get more referrals but experience diminishing returns.

9 Copyright Drafted, Inc 2021 20. External Referral Programs The median external Referral reward reported is $1,000. 25% of companies offering a Employee Referral reward also opened it up to an external Referral program. This is higher than our last survey, which was 8%, indicating that this may be a trend. Roughly 16% of the companies reported to have a sliding bonus scale based on seniority of hiring position or a hot job . bonus. Copyright Drafted, Inc 2021 21. Company Demographics and Referrals When comparing companies reported Referral data to their age and size the data shows referrals play a major part in the hiring process. Copyright Drafted, Inc 2021 22. Company Demographics and Referrals When comparing a company's reported Referral data to their age and size the data shows referrals play a major part in the hiring process.

10 Copyright Drafted, Inc 2021 23. Recap of Key Takeaways The choice of an Applicant Tracking System has minimal impact on Referral hiring success. The average percentage of hires from referrals is 27%, with 44% being one standard deviation above. In other words, if you're at 44% hires through referrals, you're doing an A+ job. Most companies opt for a simple cash reward with a median Referral reward $2,000. 50% of the companies offering a Referral reward also offer a hot job bonus for hard-to- ll or urgent roles. Referrals are the most popular hiring source for companies independent of company size and age. Emerging trends include external Referral Programs and experiential non-cash rewards. Copyright Drafted, Inc 2021 24. Recommendations from Drafted 5 tips to make the most of your Referral program If you don't have one already, consider an external Referral program to boost your hiring.