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Pros & Cons of Internal vs. External Recruitment

In today’s world of quick-moving business, there are generally two approaches for filling the positions you need to stay operational and keep expanding your work. This is the split between internalized recruitment and external, and when you make your most significant hiring decisions, you must choose one or the other.

Today, we will explore the definitions, benefits, disadvantages, and internal and external recruitment methods to help you make informed decisions in your hiring processes.

What is Internal & External Recruitment?

Internal recruitment is tapping into your organization’s existing talent pool, saying, “Hey, folks, who wants to level up their career here?” Ideally, it’s pulling the best people to the top, rewarding your favorite hard workers and expert problem-solvers. This includes companies that promote from within or any time you transfer an individual’s role to a different department.

On the other hand, external recruitment methods involve seeking candidates from outside the organization to fill vacant positions. Hiring external candidates can be done through various means, such as job advertisements, recruitment agencies, career fairs, or online job boards. External recruitment is like going on a blind date. You put yourself out there, advertise the job, and hope to meet someone who’s a perfect match.

Both of these methods have their place, and finding an ideal blend of each is one of the many challenges to business management. Internal vs. external recruitment methods come with their ups and downs, and knowing who can help your business get ahead will depend on what position you’re looking to fill and the company culture you’ve developed.

Internal Recruitment

Here are the highs and lows of internal recruitment!

Internal Recruitment Benefits

Internal candidates already know the company’s values, goals, and culture. As a result, they require less time and resources to adapt and can start contributing to their new role more quickly. They won’t need a welcome brochure or an orientation video; they’re already part of the cool kids’ club. 

Many of us can relate to the desire to get promoted into our old manager’s job, ready to take over the corner office and revolutionize any processes that we found frustrating. Internal recruitment can allow your employees to do just that, building new systems on the foundations of their predecessors.

Employees seeing opportunities for growth and advancement within the organization enhances their job satisfaction and motivation. This, in turn, can improve productivity, reduce turnover rates, and make your workplace a pleasant place to be. Hiring experienced employees is a great cost-saving measure. You can skip the expensive job ads and recruitment agencies and invest in more raises and benefits for veteran team members. Or perhaps a ping-pong table.

Internal Recruitment Disadvantages

The downside of seeking an internal hire is that you’re fishing in a smaller pond. Depending solely on internal candidates may lead to a need for more diverse ideas and skill sets. Sometimes you need a fresh face with new ideas and perspectives rather than someone who can recite the company mission statement in their sleep. 

Choosing someone from your existing team can be like trying to pick a favorite child. It can lead to jealousy and office drama. Therefore, managing these potential conflicts and ensuring fairness and transparency in the selection process is crucial, even if that means involving human resources.

Promoting from within will likely lead to higher salaries than if you had hired externally, as an internal candidate is likely starting from a better bargaining position than someone you pick up off a job board. This is to be expected but is still a disadvantage to promoting internally.

Internal Recruitment Methods

Internal job postings, employee referrals, talent management programs, succession planning, and cross-departmental transfers are some standard methods used in internal recruitment. Clear and transparent communication is critical for making any of these methods work. Internal recruitment depends on your employees knowing there’s a better job down the road.

External Recruitment

How about hiring high-level roles with external recruitment methods? Here’s what you need to know.

External Recruitment Benefits

By looking outside the organization, you can tap into a wider talent pool with diverse backgrounds, experiences, and skill sets. This can bring fresh perspectives, innovative ideas, and new approaches to problem-solving. Certain positions may require highly specialized skills or knowledge that are not readily available internally.

External recruitment allows you to target candidates with the qualifications needed for the role rather than being limited to the people already on hand. In addition, externally-found employees can bring new talent with competitive industry insights to help the organization stay ahead.

Many organizations suffer from mass resignations in the current job climate as the economy and social factors push workers to seek better conditions. Hiring externally allows you to preemptively replace employees that have already started to check out while they seek employment elsewhere.

External Recruitment Disadvantages

External hires typically require more time and resources for onboarding and training to familiarize themselves with the organization’s culture, processes, and policies. Advertising vacancies, conducting interviews, and engaging recruitment agencies can be expensive and unpredictable. External recruitment often incurs higher costs than internal recruitment methods, especially considering the time taken away from other tasks that hiring managers could be pursuing. Filling a senior position externally can possibly communicate a lack of trust among team members. 

When you hire externally, you are opening yourself up to the entire world of the public, and it’s never been easier to cheat your way into a job. While most job-seekers are honest, some more devious actors could lie about credentials, personal qualities, or more to get ahead. That’s why properly vetting a candidate with background checks is essential to long-term success. 

External Recruitment Methods

External recruitment methods commonly include job advertisements, online job portals, recruitment agencies, career fairs, networking events, and social media platforms. Of these, the exact method you use to recruit externally will depend on your industry. 

Make sure you make your job listings as straightforward as possible, delivering a specific salary you intend to pay and a concrete list of your expectations for the position. This will ensure clarity down the line and keep you from sifting through an endless pile of rejected applications. 

Bottom Line

Choosing between internal and external recruitment depends on various factors, such as the organization’s needs, the nature of the position, and the desired outcomes. Internal recruitment offers the advantage of familiarity with company culture and cost-effectiveness, while external recruitment brings in fresh perspectives and specialized expertise. 

A balanced approach combining internal and external recruitment methods can help organizations achieve a diverse and skilled workforce while retaining and promoting existing talent. Plus, you might free up enough room in the budget for that ping-pong table so all your new hires, internal or external, can make friends in the break room.

Make sure to vet your candidates to ensure they’re qualified and won’t be a liability. KarmaCheck delivers fast and reliable background checks so you can have peace of mind. Contact us today.


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