The Frog Blog

Ribbiting News in the World of Recruiting

22 Stats To Build Your Case for an Employee Referral Program

Posted by Michael Bachman on Oct 10, 2018 2:28:00 PM

Employee referral programs prove themselves time after time to be a well valued investment. All investments require some type of capital to get off the ground and your employee referral program is no different. Incentives, time, and several other factors play into the successful launch and ultimately success of your employee referral program.

Struggle no more. From the motives behind referrals to the cold hard cash -- we’ve scoured the Internet to find the best statistics to help you build a business case around implementing an employee referral program. It’s a no brainer and here are 25 stats to prove it:

22 Stats To Build Your Case for an Employee Referral Program

The Employee Referral 

  • The #1 way people discover a new job is through a referral. [LinkedIn]
  • The top channels people use to look for new jobs are online job boards (60%), social professional networks (56%), and word of mouth (50%). [LinkedIn]
  • Two-thirds of referred employees have referred at least one person for a job at their company. [iCims]

Why does the referrer, refer? 

  • 35 % of employees refer to help their friends. 32% do it to help their company. 26% do it to be seen as a valuable colleague. Only 6% do it for money and recognition. [LinkedIn]
  • Two-thirds of referred employees have referred at least one person for a job at their company. [iCims]

Hiring the employee's referral 

  • Larger companies tend to recruit more of their new hires from employee referrals (27 percent) than mid-sized (24 percent] or smaller companies (14 percent]. [iCims]  
  • Almost 70% of companies offer between $1,000 and $5,000 in cash incentives for staff members who are able to refer qualified candidates. [Meritage]
  • Employee referral programs are more likely to attract passive candidates.[Recruiter]
  • Candidates are 46% more likely to accept InMails when they're connected to your employees. [LinkedIn]Slide19.jpg
  • They are 3-4 times more likely to be hired than non-referral candidates. [CareerXroads]
  • 41% of referrals come from the organization’s external network. [Zao]
  • Non-employees most desired as referral sources include company alumni, customers, social media connections and vendors. [Meritage]
About 33% of companies use third-party software systems to manage their employee referral programs. [Meritage]
  • Recruiters in 53 percent of best-in-class organizations use social media networks for referrals, compared to only 37 percent of less successful organizations. [Aberdeen]
  • 69 percent of large companies have a documented referral process, compared to 46 percent of smaller companies. [iCims]

The employee referral conquers the workplace 

  • Referrals were are listed #1 as the most productive” source for diversity hires, well ahead of major job boards, company affinity groups, and diversity career fairs. [CareerXroads]
  • The chances of a referred candidate getting fired decrease by an average of 350%. [Achievers]

Show me the money! 

  • Employee referrals can save organizations $3,000 or more per hire. [Recruiter]
  • New hires sourced via referral programs produce 25% more profit for their companies than new hires sourced via other means. [Alexander Group]
  • 75% of companies prefer to use employee referral program systems that allow for automated or semi-automated processes. [Zalp]
  • 28% of organizations trying to fill a typical exempt position will offer a $1000 referral bonus. [CareerXroads]
  • Employers who pay out employees in real time see an 83% uptick in engagement in their employee referral program. 

While a large percentage of companies already have employee referral programs in place -- the majority of them are managed quite differently. From which department is performing better due referrals, to the types of tools or incentives offered, companies are constantly pivoting and finding what works for them. When it comes to building that solid business case behind starting your own employee referral program -- the facts don’t lie. It’s time you start one.

Topics: employee referral programs

Subscribe to Email Updates

Download our latest eBook! 


  • Establish a budget with information that actually matters
  • Boost participation internally by better utilizing your own employees
  • Successfully measure the overall impact on your company

Download your copy today!

See Preferhired in action! 

How to Recruit Smarter on Preferhired Animation Video


Recent Posts