Salesforce tops employee referral hiring in U.S.
WASHINGTON, D.C., UNITED STATES — A new study found cloud computing giant Salesforce hired the most employees through referrals, with 41.64% of job offers going to referred candidates.
“Referrals are a primary source of hire for salesforce.com,” comments Kate Israels, the firm’s Director of Talent Experience & Recruiting Programs.
“In fact, employee referrals are 10 times more likely to be hired than other sources.”
According to the study by Switch On Business, Salesforce “encourages employees to refer fresh talent with competitions, recruitment happy hours and awards (like tickets for San Francisco Giants events), bestowing cash bonuses of $2,000 on successful referrers.”
Devon Energy, a multi-billion dollar mining company, ranked second among Fortune 500 firms, hiring 26.23% of referred candidates.
The study analyzed interview data from Glassdoor for 1,493 top U.S. companies to determine the proportion of interviewees who received job offers through employee referrals.
Sector-specific trends among referral hiring companies
In the tech sector, Nutanix emerged as the second most likely company to hire referrals (30.73%), followed by HubSpot (24.76%), DocuSign (23.77%), Broadcom (22.37%), and ServiceNow (21.60%). The average rate of job offers made to employee referrals in tech was 17.37%, higher than any other industry.
Northern Trust, a wealth management firm, topped the finance sector by offering jobs to 25.25% of referred employees. Coinbase (22.61%), Rocket Companies (22.38%), and Arthur J. Gallagher (21.89%) followed closely.
In the media industry, the Salem Media Group, a radio broadcaster and book publisher in Texas, hired the highest percentage (25.98%) of referred candidates, followed by Activision Blizzard (25%) and BuzzFeed (20.27%).
Why companies favor employee referrals
In the U.S., employee referrals are a major gateway into companies, with between 30% and 50% of all hires stemming from this source. Seven in ten U.S. employers maintain referral programs, endorsing the notion that “A-plus people know other A-plus people,” as stated by BuzzFeed’s talent VP, Joel Greengrass.
Employers cite cost-effectiveness, better cultural fit, and longer employee retention as key reasons for favoring referrals.
“On average, referrals cost $1,000 less per hire than another recruitment source,” the report said.
However, critics argue that overreliance on referrals can lead to homogeneity and exclusion of diverse talent pools. This emphasizes the need for a balanced hiring strategy that includes traditional and innovative recruitment methods to ensure a diverse and competent workforce.
