Online recruitment still in its infancy

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Among recruitment agencies and headhunters there are those who barely use online methods for sourcing candidates and others who both have their own job sites and use third-party sites, sometimes to considerable effect.

Employers themselves, meanwhile, range from those who now post all their vacancies on their corporate websites, such as JP Morgan, and those who post none, except perhaps for graduate trainees.

The overall picture, therefore, is of an industry, or a tool, still very much in its infancy.

Jonathan Wright, group business development director at the headhunter Alexander Mann, says the internet potentially offers two things in recruitment - a new way of sourcing candidates and process efficiencies in hiring. Of the two, he says the former has been surrounded by the bigger hype, but the latter is probably easier to deliver.

It is certainly true that the initial excitement has been about how people could use the internet to find a job. This was the spur for the creation of numerous job sites. Some are independent, such as StepStone, and others are owned by recruitment companies, such as TMP's highly successful Monster.com or Morgan McKinley's Citipeople.

Others have been created by publishing companies, like FTCareerPoint or eFinancialCareers, owned by the Financial Times and Financial News respectively. There is also direct recruitment by companies posting their vacancies on corporate sites.

While some of these companies and strategies have clearly been more successful than others, figures on how many people have actually been placed through the internet are hard to come by. The success of the internet as a method of sourcing candidates, therefore, is hard to gauge, although definitely growing.

Most of those involved keep their figures close to their chests or, in the case of many job sites, have no way of knowing for sure how many people have found jobs through them, since they rely for this information on candidates or agencies letting them know of a successful placement.

One recruitment company that does provide statistics is Morgan McKinley, which says that 25% of its live candidates - those it is actively seeking to place - now come from its jobsite, Citipeople, while 17% of placements it made over the last year were people sourced from the site. Notable casualties in 2001 included StepStone, which closed its UK site, and Newmonday, which closed sites in some other European countries.

In the US, internet recruitment is more widely accepted than in Europe. Fifteen million US candidates have registered with Monster.com, for example.

If there is one area in which the internet clearly does play a leading role, it is the recruitment of graduates. Most investment banks and many large employers in all sectors have put their graduate recruitment processes entirely online.

JP Morgan was one of the first banks to do so, going 100% online for graduate and MBA recruitment in 1999. Helen Bostock at JP Morgan says the move has been an unequivocal success, reducing the total number of applications from 20,000 to 15,000 worldwide, while increasing their quality. The online application process, she says, takes between 90 minutes and two and a half hours to complete, requiring a reasonably high level of commitment from applicants. For the bank, the standardisation of information and pre-sorting built into the system represent considerable savings.

Amanda Whiteford, graduate recruitment manager at Dresdner Kleinwort Wasserstein, is similarly enthusiastic. The bank went exclusively online for graduate recruitment in 2000 and for MBA recruitment in 2001. In DrKW's case applications went up by 15% when the bank went fully online and the medium has proved particularly useful for international candidates. 'It's easier to grade applicants according to our criteria now,' says Whiteford. 'The graduates seem happy with the process because we have a more efficient way of liaising with them and dealing with their enquiries.'

These are the kind of efficiencies highlighted by Wright at Alexander Mann. The real benefit to the banks of going online with their graduate recruitment has not been in accessing a wider pool of candidates, but in making the recruitment process more efficient. Wright believes that, if used correctly, internet tools can offer savings of up to 60% in recruitment costs. 'In the administration of temporary or contract staff, for example, an annual cost of 2,500 can come down to 800,' he says.

While process efficiencies are perhaps more tangible, the potential of the internet in sourcing candidates remains the holy grail.

When it comes to job sites, most commentators agree that the market will consolidate to one or two large generalist sites, of which Monster.com is in poll position, plus a host of niche sites serving particular sectors. In financial services, eFinancialCareers and Fincareer are among the competitors, while Jobserve has made its mark in IT.

What will drive success, apart from their ability to provide a user-friendly service, is more people willing to go online to find a job.

Across all sectors, the internet has been more useful to date in attracting younger and, therefore, less senior people. Older, more experienced people on salaries above 60,000 or 70,000 are not yet turning to the internet in large numbers, though financial services may be an exception. They are kept away by a lack of experience of the technology and a suspicion about the quality of service offered by websites.

However, as the current generation of graduates grows up, the pool is likely to expand. If you applied for your first job online, you will be more inclined to go back to the internet for your next one.

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