10 Advantages of Hiring From Within


HR Insights for ProfessionalsThe latest thought leadership for HR pros

Monday, October 8, 2018

Hiring internally can have a number of advantages for your company, helping to keep staff happy and reach objectives.

Article 5 Minutes
10 Advantages of Hiring From Within


Deciding whether to reach out to your current professionals or look externally when it comes to filling a vacancy can be a difficult decision. Offering new opportunities to professionals within your organization can have a range of unique benefits that companies simply won't experience if they consistently look outside the business:

1. It's cost-effective

One of the biggest advantages of hiring internally is that it reduces your overall recruitment costs. Not only do you not have to invest in advertising your role on third-party websites or on social media, but it's also unlikely you'll have to set aside as much time for interviews. When you hire internally, you normally get a smaller talent pool, meaning you don't need to spend hours sifting through applications to decide on who to interview.

But it’s not just the recruitment costs that can be lowered. Onboarding and training costs will also be significantly lower as the employee will already understand how your company works and have a good handle on the job position.

Promoting someone among your current staff to higher roles also means your main recruitment focus will be on entry-level roles, where the investment is lower so there's less financial risk if it's a bad hire.

2. It raises morale

Morale has a massive impact on productivity and internal hiring can help to improve sentiment among employees. If you consistently overlook your in-house professionals in favor of external candidates, you may find that people feel short-changed and even offended because you don't consider them to have the right skillset.

Giving people the opportunity to progress will make them feel more valued at your company, as well as allowing them to showcase their contribution to the organization.

3. It improves retention

Hiring from within gives people the opportunity to progress and develop their skills without needing to leave the business. This is likely to boost retention even for employees who aren't ready to move up the career ladder just yet. Seeing other people in the business be rewarded for their good work can be enough to motivate employees and convince them to stick with you.

4. The risk is lower

One of the biggest risks of hiring a new person is that they won't fit in with their team or the company as a whole, but this risk is much lower - almost non-existent - when hiring internally. The candidate is likely to be already engaged in your business objectives and method of working.

Whilst it still may be necessary to conduct a probationary period, the internal recruit will be familiar with how the business functions and will likely already have the necessary skills to fulfill the role. If you have employees who are moving department, the perspective they can supply, as a result of working in a different area previously, can be invaluable.

5. Performance is generally higher

Figures show that internal hires generally perform better than their external counterparts, allowing companies to even further mitigate the risk associated with recruitment.

There's also the knock-on impact of higher productivity from increased morale among the workforce that employers should take into consideration.

6. It's unlikely you'll get in a bidding war

When you offer a job to an external hire, you run the risk of getting into a bidding war. They may have had offers from other companies they were interviewing for or are trying to blag it, but it's easy to get in a situation where you're negotiating salary and benefits with external hires.

Not only can this delay a start date, but it can cost you more than you were willing to pay by increasing the salary on offer or making you reconsider your talent pool. This is much less likely to happen with internal hires, as you are aware of what they are currently being paid and they're unlikely to have other offers on the table.

7. They fit with your company culture

Company culture is a massive part of running a business and keeping employees happy. It can have an impact on morale, retention, productivity and many other factors that underpin the success of a business.

Hiring someone who already works for you means you don't have the risk that they won't fit in or get along with their team. It's also likely that someone who is going for a promotion feels invested in your business objectives and company culture, allowing them to take this understanding to a higher position.

8. It's a ripple effect

By promoting an internal candidate, there's a ripple effect of vacancies that emerge as a result. When you hire externally you bring one new person onboard, but internal hiring allows a number of employees to progress and develop their skills. This means the boost of morale, loyalty and productivity won't just be felt on one team, but can be experienced throughout the company.

9. It makes you attractive

Employees care more about the type of employer they are working for than ever before. Being a company that prioritizes loyalty and rewards hard work is a desirable quality for both candidates looking to secure a new role and professionals who are trying to decide whether to move on or not.

Regularly hiring internally will make you a more attractive employer to new hires and your current employees. This will give you more collateral when you have to make external hires and boost employee retention among your workforce too.

10. It provides an incentive

Offering new positions to employees first works as an incentive for professionals. If they are looking to increase their skill set or salary, it pays to prove yourself in your current role and make the most of your current resources. This can lead the way to more innovative and creative ideas as professionals look to stand out from their colleagues. In the long term, it's a massive advantage for businesses, as the workforce will be more engaged with company objectives and will be as productive as possible.

HR Insights for Professionals

Insights for Professionals provide free access to the latest thought leadership from global brands. We deliver subscriber value by creating and gathering specialist content for senior professionals.


Join the conversation...