Article: Graduate Recruitment- Using Talent Intelligence to Deliver Greater RoI

Talent Acquisition

Graduate Recruitment- Using Talent Intelligence to Deliver Greater RoI

CEB's research, 'Driving New Success Strategies in Graduate Recruitment' explores global graduate recruitment landscape
Graduate Recruitment- Using Talent Intelligence to Deliver Greater RoI

According to a CII study, India produces a record 5 million graduates every year, but only 34 per cent of them are employable


1 in 6 employers in China and India say graduates have what they are looking for
17% of hiring managers think students have the skills and knowledge they need
7 in 10 employers think that students need to do more to prepare themselves for the work place

In a country that has a population of 1.2 billion, it is concerning to learn that despite the dramatic expansion of university education that has turned out five million well-educated young people this year alone, roughly 83 per cent of employers are dissatisfied with the quality of graduate talent..

Businesses have long been airing concerns over talent shortages and skills gap, but the numbers just don’t add up. Firms in Asia Pacific need to rethink their approach to graduate recruitment and development if they are to secure top young talent and lead productivity, innovation and performance in the emerging markets.

According to a survey by Confederation of Indian Industry (CII), in partnership with Wheebox and PeopleStrong, only 34 per cent of graduates demonstrated strong skills – in English language, information technology, and general and domain-specific abilities – that make them desirable and employable to firms.The online Wheebox Employability Skills Test (WEST) is endorsed by the CII and Association of Indian Universities, is the first effort in its kind that has brought government, industry, sector skill councils, association and academia on one platform. The survey was conducted in 2,200 colleges across 28 states and seven union territories for August and September 2013.

Yet another study by research firm Aspiring Minds ‘National Employability Report Graduates – 2013’ painted an even grimmer picture. About 47 per cent graduates are not employable in any sector of the knowledge economy, given their English language and cognitive skills. And less than 25 per cent of the graduating students could apply concepts to solve a real-world problem in the domain of finance and accounting. What’s more over 40 per cent of employable graduates beyond the top 30 per cent colleges have no way to signal their employability to potential recruiters.

There is a huge emphasis in India on education and a lot of importance is given to having good educational qualifications from good colleges and universities. However, CEB believes that organizations could be self-perpetuating talent shortages by recruiting in the image of their ideal graduate based on their previous academic achievements.

According to the leading member advisory company, the chances of finding the notional top graduate talent is only one-in-15. Employers are too focused on recruiting for hard skills and not enough value is being placed on the soft skills – communication, analytical thinking and cognitive abilities – that are not as easy to teach or develop in people, which goes some way to explaining why there are so many unfilled graduate vacancies.

Further exploration is needed in to this concept, which begs the question: what’s going on in the graduate market today that could be fuelling this vicious cycle?

Changing dynamics in the graduate market

We are living in a knowledge economy, where globalization, change and the war for talent have become the norm. While in theory, there is more graduates talent to choose from, not all of them are going to be the right fit for your business. Hence, the fight for top talent.

The changing demographics of the workforce are a massive factor that impacts workplace dynamics. Gen-Y and Millennials are flooding the workforce, forcing companies to re-think their talent strategies to attract and develop this talent sub-set and but also more effectively manage and engage a multi-generational workforce. Gen-Yers are more mobile and social than the previous generations. And with a borderless jobs market, opportunities are no longer limited to hometowns or commutable locations.

In the next 15 years, 78 per cent of global GDP is expected to come from new markets (Goldman Sachs 2010, EM Equity in Two Decades: A Changing Landscape, Global Economics Paper No. 204), and with 61 per cent of CEOs placing greater emphasis on global expansion (CEB 2014), talent shortages and shifts in employer presence in geographies such as China are presenting challenges in achieving MNCs’ aspirations for growth.

More graduates move abroad for better educational and job opportunities. Emigration has become a major factor in graduate recruitment. Surveys conducted by the Organization for Economic Cooperation and Development (OECD) show that the number of students enrolling in educational programs outside their own country has more than doubled in the past decade to around 4.5 million and one-in-five graduates are looking for employment in the country of study. Australia, the UK and the US are popular destinations.

So the landscape and dynamics of the market are changing and of course they will continue to evolve. These factors alone aren’t increasing the global skills shortage but they do highlight the vital role that graduates have in the business environment and underline the urgency of finding work-ready graduates.

Challenges faced during graduate recruitment

One of the primary challenges that the recruitment function needs to overcome is managing volume of applicants with providing a positive candidate experience that protects the employer and consumer brand.

According to The Graduate Market in 2013 – High Fliers, an independent market research company, which specializes in student and graduate recruitment research in the UK, 78 per cent of graduate recruiters experienced up to 50 per cent more applications compared to the previous year. Many employers say that graduates lack soft skills and communication.

The National Association of Colleges and Employers (NACE) surveyed 244 US employers in 2013 and identified their top 10 requirements in acquiring graduate talent. They are in order of importance:

  1. Ability to verbally communicate with persons inside and outside the organization
  2. Ability to work in a team structure
  3. Ability to make decisions and solve problems
  4. Ability to plan, organize and prioritize work
  5. Ability to obtain and process information
  6. Ability to analyze quantitative data
  7. Technical knowledge related to the job
  8. Proficiency with computer software programs
  9. Ability to create and/or edit written reports
  10. Ability to sell or influence others

The second challenge that needs to be addressed is current recruitment practices. Today, two-in-three graduates regret accepting the job offer for their first role and one-in-four hires have no intention of staying longer than one year at their organization.

While companies find it difficult to get the right graduate talent, graduates too are finding it difficult to find the right employer and job for them. CEB research shows that nearly half of all graduates worldwide (45 per cent) receive more than one job offer and that one-in-four receive three or more job offers. Companies must identify and select the right talent that is the best fit for the firm and more likely to be effective for the business long-term.While it could be argued that this trend reflects increasing competition for top jobs, applying to multiple employers is also a rational tactical response by graduates who are keen to maximize their employment opportunities. That said, many apply for jobs that are not mapped to their skills or their education. At least one- in-five graduates (21 per cent) report that they apply for jobs that do not match their interests.

The third challenge is to nurture the future leaders that will drive organizational objectives and future-proof business success. According to CEB approximately one-in-10 graduates entering the workforce has the potential to be an effective leader in the future. There is clearly a mismatch in terms of skills that graduates have and skills that businesses need and value both today and for the future. Organizations need to define these skills and ensure they have a consistent, accurate and scalable approach to measuring candidates against the criteria. So what are grads really looking for?

Why employer branding matters

Job applicants look for companies which have a strong employee value proposition (EVP). It defines what an employer expects from its employees and what it provides in return. This is vital for influencing candidates’ decisions to want to work for the business and to help secure the right match between candidate and employer. Most firms presume that graduates are lured by salary and material reward. Today’s graduates are actually motivated by opportunities to develop and grow, demonstrate the talents they have and progress in the organization.

CEB research shows that organizations with a less effective EVP pay a 21 per cent higher premium to acquire new employees. Such organizations who use their EVP more effectively are highly likely to see highly engaged employees. It is a powerful engagement tool when it is utilized effectively. If there is a very good alignment between the brand and the EVP, it would encourage employees to adopt the positive behaviors that will ultimately deliver on the brand promise.

“Most companies pay attention to employer branding, but they often end up focusing only on what they are looking for in their graduate hires. However, to build a strong and effective EVP, firms also need to better understand what graduates are looking for from them. Leading organizations take a proactive approach to first understanding what motivates graduates and their underlying aspirations so they can tailor and ensure their EVPs are more appealing and relevant,” says Shaurav Sen, Executive Director – Southeast Asia at CEB.

Currently, two-in-three graduates spend five hours or less researching employers before applying and so organizations have a very tight window to communicate the substance of their EVP. Many graduates today check out their prospective employer online before deciding to approach them for jobs. Websites like LinkedIn, Twitter, and Glassdoor etc have all become the first stop shop for most prospective candidates.

The effectiveness of an EVP also has a big impact on the downstream costs of retaining graduate talent once hired. CEB research shows that for every 10 per cent increase in the commitment of an employee, there is six per cent increase in the discretionary effort they invest in their work, which results in a two per cent increase in overall productivity (CEB 2014).

In a recent CEB survey, 77 per cent of companies employ an employer branding specialist out of which 24 per cent spend their employer branding budget on social media and only 5 per cent actually spent it on employer branding research and measurement. Many companies think that social media is the best way to attract potential candidates and 94 per cent of recruiters are planning to use social media (Jobvite Social Recruiting Survey 2013); 82 per cent of organizations are increasing the use of social media as well (CEB 2014). While 71 per cent recruiters consider themselves competent at the use of social media, only 37 per cent recruiters believe in the effectiveness of social media for hiring.

Sen vouches for caution while using social media. “Companies need to be cautious about using social media in the recruitment process. Social media information will tell them very little about a candidate’s ability to do the job. Sifting through or distinguishing between candidates in this way could reduce perceptions of fairness of the process or even lead to claims of discrimination. Instead, recruiters should focus on the competencies and skills needed for a particular role and measure those skills to determine candidates’ suitability.”

The value of talent insights

A simple model of employability, framed by key behaviors that drive effective job performance in the short-term and fuel broader potential for future roles, provides a clear lens through which organizations can know the talent space they occupy. That lens, combined with intelligence on what really motivates today’s graduates, is a powerful lever for driving more effective investment in graduate recruitment, and for managing the premium that organisations pay for graduate talent and the return they see for paying that premium.That intelligence goes further in increasing the likelihood that graduates make an informed choice when they apply to an employer, that they commit to and persevere through an organization’s recruitment process, and that they stay with the business once they are hired.

Conclusion – What can the HR do?

Workforce planning is a high priority for HR and business leaders globally; this reflects the escalating importance of using data to forecast future staffing needs. While majority of CEOs report a greater need for talent insight to help inform decision-making, only one-in-seven senior leaders see their recruitment function as providing the proactive advice they need to help shape business strategy. The pressure to ensure that the right people, with the right skills are in place at the right time is intensifying – and business leaders need greater support and reliable data from HR to help them plan their talent strategy. Big data or talent intelligence is the critical connector between people planning, investment and decisions to short- and long-term business outcomes.

In the new world of work, the answer to better recruitment is not more data but talent intelligence that will help organizations to stay ahead of competition. With the right insight, organizations can not only improve the effectiveness of the graduate programs but also reduce the premium they pay for graduate talent. Talent intelligence provides graduate recruiters the power to make decisions more effectively.


The data for the story has been taken from the CEB-SHL Talent Report 2014 ‘Driving New Success Strategies in Graduate Recruitment’ by Eugene Burke, Chief Science & Analytics Officer and Tom Gibbs, Director of Service Development

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Topics: Talent Acquisition, #GlobalPerspective

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