Employee Referrals are on of the biggest sources of external hires.

That’s because they’re one of the most cost effective ways to attract quality candidates – the reward to employees who referred your new hire are usually about 80% lower than the cost of agency fees. Your employees can speak on your behalf to share your employment brand and show their connections why your company is a great place to work.

Plus, your employees know your company's culture and your expectation of hires, so referral candidates are essentially screened for cultural fit. It's unlikely that you are going to be referred a poor candidate, because the person referring won't want this to reflect poorly on them if they did.

Referrals are hired faster and stay longer because the new hire who was referred already knows someone in the organization and won’t feel completely alone when they start. Plus, getting referrals instead of applicants will have an impact on how many resumes you have to sift through in order to find the right hire.

Here are some quick stats for you:

• A referral candidate is 54 times more likely to result in a hire than a candidate coming from a job board.
• Employees hired through referral have a 25% higher retention rate, according to a Workforce Management & Ohio University Study.
• Jobvite found that employee referrals get hired 55 percent faster than candidates from company career sites.

Mind you, you cannot expect to make 100% of your hires through referrals, but companies that do it right can easily get 70% of their hires through referrals.