Referral recruitment is the development of a recruitment strategy that is dependent on referrals by existing employees. This approach is usually favoured when the costs of recruiting needs to be reduced. As a result of the recession the amount of time and money invested in referral schemes has increased due to the perceived frivolousness of other method of recruiting.
There are disadvantages to putting too much emphasis on referral schemes, such as reduced workforce diversity and unfairness regarding other prospective candidates.[1] To combat these disadvantages some companies are opening up their referral schemes to external contributors. Not only does this help to combat the aforementioned issues, but it also increases the size of the network of potential referrers.