more-arw search

Q&A Forum

An ethical conundrum

How do you feel: A lot is written here and elsewhere about looking for jobs and the best way to look for them. That being said, what do you think of this practice that has become more than just a cottage industry. In the old days (which these days could be yesterday), a company looking to hire would do one or all of the following: network, place an advertisement in the major paper(s) and use a Recruiting agency. The company absorbed the cost of recruitment. If a Recruiter was used, they would place candidates (fee paid by client) and make their money. Recruiters would separately advertise jobs or their services to gain resumes for their database in hopes of having the right candidate for a job which they could compete and win for their candidate; thus making their profit.

Fast forward to today: Companies are doing the same things, but advertisements not only include newspapers but also internet based ads. But here's the change: recruiters are placing the ads for jobs on the Internet boards and many of these boards are not only receiving money from the Recruiters (as should be, it is to their benefit, whether or not they have an exclusive contract with the hiring employer- think real estate) but they are not charging the job seekers. Now these job boards are charging both advertisement placer and the responders (job seekers).

To these job boards, who are the clients? The Recruiter/company or the job seeker. And if they are both, isn't this change in the paradigm actually hurting both (obviously the publisher of the job board is making money on both sides). The Recruiter/company since those job seekers who won't (for multiple reasons) "pay" for the right to apply for a job and the job seeker who misses out on opportunities since they may opt out of "paying" for the right to apply for the job. What's your feeling.

Answers

Kehinde Kolawole CPA CGMA
Title: President
Company: Kolak Business Group LLC
LinkedIn Profile
(President, Kolak Business Group LLC) |

That may be the way inernet job board operators are able to charge lower fees by expanding pool of potential paying users. It is like broaden tax base in order to lower income tax rate.

Topic Expert
Wayne Spivak
Title: President & CFO
Company: SBAConsulting.com
LinkedIn Profile
(President & CFO, SBAConsulting.com) |

Hi Kehinde,

But lower the cost to whom? The employer/Recruiter? That doesn't quite make sense... at least to little ol' me....

Topic Expert
Christie Jahn
Title: CFO
Company: Prime Investments & Development
(CFO, Prime Investments & Development) |

I am not sure what you mean by "internet Boards," however in my experience free postings haven't generated any viable hits. We use a hiring portal with personality assessments and they place all of our adds for free with Indeed.com. We never see anything from the free posts; they always come from the paid posts. I also know they have a contract with Indeed.com so I am sure Indeed is getting some money from them. They have told us they are also looking into contracting with Career Builder; which tells me CB will be getting some type of monetary gain.

We have tried to advertise by posting a job in our LinkedIn profiles and it has never generated anything unless we pay for it. I can't speak for recruiters, as we don't typically use them, but simply speaking from my experience I wonder how many decent candidates they are getting from posting on Internet Boards.

Kehinde Kolawole CPA CGMA
Title: President
Company: Kolak Business Group LLC
LinkedIn Profile
(President, Kolak Business Group LLC) |

Thank you, Wayne. Pardon me for not referencing your name in my previous comment.

To answer your question, it is lowering cost to every user. It is good to have free job boards, however, they are not free to develop and maintain. If you leave only employers/recruiters to pick up the tabs, job board operator may have to increase user fee for them in order to survive. Job boards are market places for job seekers, recruiters, and potential employer. Job seekers are investing in their bottomlines and/or future.

Jim Schwartz
Title: Corporate financial advisor
Company: Wabash Financial Strategies
(Corporate financial advisor, Wabash Financial Strategies) |

Wayne,

This approach is not new. Exec-U-Net, as one example, has been charging candidates for access to its job listings since at least the 1990s. I don't know what it charges employers or recruiters to post openings but, presumably, there is a cost.

There's a conflict but it is not hidden nor the same as a transaction involving a Realtor. As I understand the business model of an "Internet board," it makes money from getting and selling access to a listing. The listing service doesn't necessarily earn more when someone is hired. Realtors, on the other hand, earn nothing unless a sale occurs.

The more troubling question is why a candidate would pay for access to job leads. There is no silver bullet or hidden job market solution to finding a new job, just targeted hard work. There are numerous networking groups that offer job lead assistance, LinkedIn has demonstrated some value in matching candidates with recruiters and employers, and many companies post jobs on their own Website, etc. Except for perhaps low-level or entry jobs, or a really arcane job for which few qualified candidates exist, Internet job leads from generic job boards are about as valuable and likely to pay off as a lottery ticket. Finally, the number of candidates typically makes the shelf life of an Internet lead very short: a few hours up to a day or two.

Topic Expert
Wayne Spivak
Title: President & CFO
Company: SBAConsulting.com
LinkedIn Profile
(President & CFO, SBAConsulting.com) |

What I believe I may not have fully explained is I'm not talking about FREE sites per se, I'm taking about Monster, LinkedIn, ladders, execunet, Ivy to name a few I've seen.

Jim Schwartz
Title: Corporate financial advisor
Company: Wabash Financial Strategies
(Corporate financial advisor, Wabash Financial Strategies) |

My comments were more directed toward services for which candidates pay (Execunet, Ladders, etc.). I agree there is an inherent conflict, including an incentive for the service to avoid removing a posting too quickly. Aren't Monster and LinkedIn (basic) free?

Whether free or pay, services like these expose opportunities to thousands of candidates within a few hours. In my opinion, tracking, monitoring or applying for jobs identified this way is rarely an effective or efficient use of an individual candidate's time.

Anonymous
(CFO/Board Advisor) |

I don't believe much has really changed from the past to today, as far as the "ethical conundrum".

Let's review the past:

1. Employers and Recruiters paid to place Help Wanted advertisements in newspapers. The cost of the Ad depended upon: number of words in the Ad; premium placement, font (Bold & Italic), size (think Big squares vs. just a listing) and the like. In addition, Employers and Recruiters also placed ads to promote their brands and for the product/services they sold, e.g. Macy's placed Help Wanted ads as well as ads for what they were selling.

2. Job Seekers had to pay for the paper, e.g. $0.50 - $2.50 per day. Sunday papers, which usually had the best and most Help Wanted ads, cost more than dailies.. And, you may recall, the WSJ Wednesday edition was really good for accounting and finance jobs. So even in the "old" days Job Seekers were "paying" for access to job postings. And, yes, an argument might be made that there were other benefits received when buying the newspaper, e.g. news, sports, entertainment, etc. unless this was part of your daily life, buying a paper when looking for a job was an incremental cost. Also, don't forget the cost of the stamp (remember snail mail), paper and envelopes required to send your resume and cover letter out in.

Now lets look at today:

1. Employers and Recruiters pay to place Help Wanted advertisements on Job Boards. The cost of the Ad is pretty much the same, with the exception of premium placement and size. In addition, Employers and Recruiters also place ads to promote their brands and for the product/services they sell.

2. Employers and Recruiters also pay to search the data base of resumes and profiles of the Job Seekers registered with the Job Board. This is the real benefit to Employers and Recruiters, it allows them to be somewhat stealth and have access to a wide range of professionals not in their rolodex.

3. Job Seekers; A lot of this is "free" to us. There are of course sites which charge the Job Seeker. But, this has more to do with the "noise" caused by the internet, e.g. Have you ever done a search for "CFO" on Monster or Hotjobs? How may of the search listings were for Assistants to the CFO, or people reporting to the CFO, and not a CFO position? So, the fees charged the Job Seeker really had more to do with "refining" search results to eliminate the time required to find relevant positions, and the noise contained in the search results. Also, the Job Seeker doesn't have to visit each Employer's website to see what positions are available. These time and noise savings are the "benefit" provided the Job Seeker.

So here is the real change:

The internet allows national/international exposure to job postings immediately. With the exception of the WSJ there were almost no newspapers that had national, let alone international coverage. In addition, even the WSJ had regional ad placement versus national placement. As a Job Seeker wanting to relocate from say LA to NY, you needed to purchase a NY paper to see what positions were available.

This national/international exposure of job postings on the internet allows everyone, everywhere to apply to every job, whether qualified or not. This has resulted in a lot of non-relevant or qualified candidates clogging up Employers and Recruiters mailboxes. This more than anything has caused the expansion of the "black-hole" of non-response by Employers and Recruiters. Charging the Job Seeker to apply is a way for Employers and Recruiters to limit applicants to those qualified, because what Job Seeker would pay to apply to jobs they are not qualified for, e.g. busboy applying for CEO position.

Lastly, the internet has created a lot more competition amongst Job Seekers for positions since everyone sees all jobs posted nationwide, where as in the past the competition was pretty much limited to folks in the local area.

Kenneth Reid
Title: President
Company: MasterType Accounting & Business Service..
LinkedIn Profile
(President, MasterType Accounting & Business Services, P.C.) |

I have placed my own resume on a few of the internet "job boards". I will not pay a fee to place my resume on any job board that requires me to pay a fee to place my resume on that board, no matter how "successful" the board may be in helping the job seeker in finding the "perfect" job.

As Jim mentioned in his post, there are too many other avenues available to job seekers (especially on the internet) that are free, such as using LinkedIn or going to specific company websites to see what types of job opportunities are available. There is no need for the job seeker to have to pay a website to post their resume in the hopes that an employer or recruiter will see their resume and perhaps contact the individual.

(Agent, JKS Solutions, Inc.) |

Hi Wayne, I clicked on the link from the Proformative Newsletter, but I'm not sure I see an ethical conundrum.

The successful job seeker will target a company specifically then work their network to learn who they can talk to about obtaining real information about that company from ex-employees (who are the best resources if you can stomach the complaining) and from those people the job seeker can learn who the management team is and then work to get an introduction or phone appointment that could turn into an informational interview. This is how serious job seekers operate. The online application is dead because companies code their ATS systems (applicant tracking system) so carefully they weed out all candidates with dense experience that do not have the specific bullet points in the necessary order required to be visible to human eyes within the ATS results. Job seekers should know if they are applying online, only those with the least qualifications will be raised up for review.

Companies step around the equal opportunity rules by working with external recruiters with the instruction to them as third parties to only offer candidates who are currently employed. This is why Aijalon had to change it's name to Parker Lynch. Job Seekers should know by now that external recruiters only want connections to others who will provide them with a large commission or if they have information about company management. I really don't know anyone who has ever successfully gotten a job using an external recruiter and I have never successfully gotten a job using one. And today I only have a very few in my network, but I do understand that there is an information exchange that is expected.

One of the big universities did a study a few years ago trying to figure out why CFOs say there are no candidates. Well today none of the candidates want to play the revolving door game with recruiters. And we know that most of the jobs flooding Indeed.com are not really jobs at all but in fact bait for recruiters.

Most job seekers today have paid for training on job search and they treat it as business development activity and essentially that's what it has to be today because all the quality jobs available are based on who you know, not what you know.

Best

Topic Expert
Wayne Spivak
Title: President & CFO
Company: SBAConsulting.com
LinkedIn Profile
(President & CFO, SBAConsulting.com) |

Hi Valerie,

I think the "link" you refer to (in my question) was placed by the Proformative AI software, not by yours truly.

Interesting point of view; and I don't disagree.

See https://www.linkedin.com/today/post/article/20140714151255-15454-there-are-only-four-types-of-people-are-you-hiring-the-right-ones , another interesting take on the hiring issue. The comments are fascinating..

Anonymous User
Title: CFO
Company: Local Government Agency
(CFO, Local Government Agency) |

"all the quality jobs available are based on who you know, not what you know."

Now THAT's a real ethical dilemma. It cheats the organization and rewards individual employees instead. It would also be a pretty sound basis for lawsuits claiming illegal discrimination.

Something I was taught early in my career which has stuck with me for years was, don't have a job referral incentive and don't use your employees to refer candidates to you for a position.

The reason? Because "birds of a feather flock together". You are likely to end up with a homogenous workforce which will likely not offer up diverse ideas.

And, it likely won't be diverse in other ways which can result in discrimination charges. See my comment above.

1775 views

Get Free Membership

By signing up, you will receive emails from Proformative regarding Proformative programs, events, community news and activity. You can withdraw your consent at any time. Contact Us.

Business Exchange

Browse the Business Exchange to find information, resources and peer reviews to help you select the right solution for your business.

Learn more

Contribute to Community

If you’re interested in learning more about contributing to your Proformative community, we have many ways for you to get involved. Please email content@proformative.com to learn more about becoming a speaker or contributing to the blogs/Q&A Forum.