Should You Hire Active or Passive Job Candidates? What the Latest Statistics Reveal

July 6, 2017
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2017 is a challenging time to be a hiring manager, but a spectacularly rewarding time to be a highly-skilled worker. The U.S. economy is robust and the job market is thriving, with nearly 10 million new jobs expected to be added from 2014 to 2024, according to the U.S. Bureau of Labor Statistics. Following the last recession, we have had 86 consecutive months of national job growth.

National unemployment has been falling steadily since 2010, and is now at 4.3 percent, the lowest rate in ten years. In the city of Dallas and in the greater DFW Metroplex, unemployment is even lower at 4 percent and 3.8 percent, respectively. In Dallas, 650K of the 678K work force was employed as of May. Given the projected growth in jobs, low unemployment is likely to remain the norm for the foreseeable future.

Clearly, many human resource professionals, hiring managers, and recruiters are in unchartered territory. Labor sourcing strategies that worked well for most employers just a few years ago are no longer as effective. To overcome the obstacles of operating in an employer’s market, many companies are casting a broader net and balancing their searches between active and passive job seekers. In DFW, they are also forging closer relationships with staffing agencies and recruiters who are well-networked and know the local talent pool in both groups.

Before determining any shifts in your hiring strategies, or in the staffing agencies and recruiters you work with, it is vital to understand the makeup of active and passive job candidates.

What Are Passive Job Candidates?

“Passive” job candidates are actually actively employed workers who are not proactively looking for work. Collectively, they are sought after primarily because they are the most highly skilled and qualified of the two groups. Given the size of the talent pool, it is also easier to precisely target specific qualifications.

Passive candidates presently account for 75 percent of the U.S. workforce. Most are satisfied with their current employer, are good employees, and show every indication to continue to be so with their next employers. The keys to hiring them are to offer advancement and/or greater salary and benefits.

5 Reasons to Pursue Passive Job Candidates:

  1. Choice: The majority of qualified job candidates fall into this category.
  2. Skill: Relative to active job candidates, the median passive candidate is more skilled.
  3. Fit: Target the precise skill and experience sets you require.
  4. Safe: Avoid workers who have not been productive with a previous employer, or who inflate their qualifications on applications.
  5. Less Competition: You will more likely make an offer at a time when there are no competing offers.

Statistics

  • 72 percent of candidates cite advancement opportunities as the reason why they would change jobs. (Source: MRINetwork)
  • 44 percent of adults subscribe to job alerts, including the employed and unemployed. (Source: Jibe)
  • 52 percent of small businesses reported a scarcity of qualified candidates in 2016. (Source: NFIB)
  • 46 percent of business report that finding suitable candidates is the biggest obstacle to hiring. (Source: LinkedIn)
  • Caveat! 51 percent of passive candidates are not successful in a new job due to a lack of passion or commitment. (Source: Jibe)

What Are Active Job Candidates?

Active job seekers may be less qualified on the whole relative to passive job seekers, but they are highly desirable for other reasons. They are engaged in their job search, proactive in searching for particular positions and companies (yours!), and highly motivated to succeed once they land their new roles. For many hiring managers and recruiters, these advantages outweigh the skill and experience advantages that passive candidates often offer. In fact, 70 percent of employers in a recent study felt active candidates were more motivated to succeed in a new job than passive candidates. The key to hiring the right active job seekers is a comprehensive screening process.

5 Reasons to Pursue Active Job Seekers:

  1. Motivation: Their engagement in the job search indicates they may be more driven to get the job and to succeed in it.
  2. Readiness: They are making proactive decisions to advance in their careers now.
  3. Fit: They are looking for greater responsibility, stability, benefits, or something your company offers.
  4. Ease: It’s easier to attract qualified active job seekers—they’re responding to ads and contacting you.
  5. Cost: Active job seekers can typically be hired for less than a comparable passive candidate. It’s also more expensive to search for passive candidates.

Statistics

  • 90 percent of recruiters say they prefer to hire active candidates. (Source: Jibe)
  • 70 percent of employers feel active candidates are more motivated and driven to succeed in a new job. (Source: Jibe)
  • 51 percent of recruiters say active candidates are more motivated. (Source: Indeed)
  • 71 percent of workers admit to active job searching or at least openness to a new opportunity. (Source: Jibe/Indeed)
  • Among all employed adults, 65 percent look at new opportunities within 3 months of starting a new job. (Source: Jibe)
  • 64 percent have more confidence in employers and jobs when they identify them for themselves than when they are called about an opportunity. (Source: Jibe)
  • 32 percent of passive candidates expect a salary increase of more than 15 percent on average, which means active job seekers can often be hired at lower salaries. (Source: Jibe)

As you incorporate a greater understanding of these two groups into your hiring processes, consider identifying your new hires as passive or active candidates. This will enable you to adapt your strategies if you find that one group tends to find more success in your organization than the other. Be aware, however, that there is a hybrid group of passive candidates that are occasionally active. Some of these candidates may contact you, or you may contact them. This group can make it difficult to determine whether your best hires were passive or active candidates.

Is your organization already in the process of adapting your hiring strategies to today’s employee market? Feel free to share your learnings and best practices with our community on Facebook!