Bringing down recruitment cost requires a long-term programme that needs to be backed up by a clear goal and innovation. The recruitment programme should work on the principle of reaching the prospective employee and completing the whole process of recruitment with speed. Here are 5 best practices that you can tap on to help reduce your recruitment cost.
1. Set a clear goal about your recruitment requirements.
Knowing what you want for your recruitment goals enables you to reach relevant candidates at the fastest pace. The Job Description (JD) is the first and most crucial step in the recruitment process. It needs to be prepared by a subject matter expert or the department manager. A casually prepared job details page, with either an unnecessarily long and unneeded set of requirements or an incomplete set of requirements, hinders the process. Ultimately, you may lose out on an employee who is genuinely good at the core requirement and instead appoint somebody with non-core skills.
2. Be visible to candidates on the web and partner with professional networking platforms.
Recruiters gain an edge by positioning themselves at the strategic platform where candidates, regardless of the level of work experience, visit for news related to their profiles, industry trends and new job opportunities. Using the internet to conduct interviews and tests brings down recruitment costs considerably. Candidates will also thank you for it, as they save travelling and lodging costs and time when recruitment is done online.
3. Use social media and leverage it for promoting job opportunities.
Having a good social media presence helps companies to understand employee requirements through interactions on social media pages. Prospective employees also get a feel of the company and when appointed, they are ready and enthusiastic to blend into the working ethos of the company. Twitter, LinkedIn and Facebook are great channels to reach out to active and passive job seekers, making recruitment more direct, accurate and less time-consuming..
4. Manage attrition and retirement.
The Oil and Energy industry is among the top 8 industries with the highest turnover rates. The most effective way to bring down recruitment costs is to always engage your existing workforce and prepare for attrition. There are various reasons why employees walk away from an organisation. According to a LinkedIn survey in 2015, 45% of professionals leave their jobs because of a lack of opportunities and 41% do so because of dissatisfaction with their senior leadership. A big chunk of recruitment costs comprises of filling vacancies as a result of attrition. Attrition, when managed with the right approach, can drastically reduce recruitment costs.
Another strategic move in the recruitment process is to plan in advance for upcoming retirements. Replacement for retired employees is completely different from regular recruitment. Because any retired employee, with valuable years of experience, leaves a much bigger set of shoes to fill in, recruitment for his/her replacement needs advanced planning in consultation with the retiring employee. An urgent notification for such a vacancy does not lead to immediate results.
5. Referrals always matter.
Word of mouth is a powerful marketing tool in a decision-making scenario like recruitment and career advancements. Referred candidates come with minimum recruitment costs and a great possibility of being long-term employees. They also feel more confident and assured when somebody known to them is already working for the company.
To effectively acquire quality talent in any industry, an organisation needs to find the right balance between technology and people analytics. Further one needs to optimise their recruitment processes, to deliver an engaging candidate experience, yet keep the overall talent acquisition costs low.
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Headline crude prices for the week beginning 11 February 2019 – Brent: US$61/b; WTI: US$52/b
Headlines of the week
Midstream & Downstream
Global liquid fuels
Electricity, coal, renewables, and emissions
2018 was a year that started with crude prices at US$62/b and ended at US$46/b. In between those two points, prices had gently risen up to peak of US$80/b as the oil world worried about the impact of new American sanctions on Iran in September before crashing down in the last two months on a rising tide of American production. What did that mean for the financial health of the industry over the last quarter and last year?
Nothing negative, it appears. With the last of the financial results from supermajors released, the world’s largest oil firms reported strong profits for Q418 and blockbuster profits for the full year 2018. Despite the blip in prices, the efforts of the supermajors – along with the rest of the industry – to keep costs in check after being burnt by the 2015 crash has paid off.
ExxonMobil, for example, may have missed analyst expectations for 4Q18 revenue at US$71.9 billion, but reported a better-than-expected net profit of US$6 billion. The latter was down 28% y-o-y, but the Q417 figure included a one-off benefit related to then-implemented US tax reform. Full year net profit was even better – up 5.7% to US$20.8 billion as upstream production rose to 4.01 mmboe/d – allowing ExxonMobil to come close to reclaiming its title of the world’s most profitable oil company.
But for now, that title is still held by Shell, which managed to eclipse ExxonMobil with full year net profits of US$21.4 billion. That’s the best annual results for the Anglo-Dutch firm since 2014; product of the deep and painful cost-cutting measures implemented after. Shell’s gamble in purchasing the BG Group for US$53 billion – which sparked a spat of asset sales to pare down debt – has paid off, with contributions from LNG trading named as a strong contributor to financial performance. Shell’s upstream output for 2018 came in at 3.78 mmb/d and the company is also looking to follow in the footsteps of ExxonMobil, Chevron and BP in the Permian, where it admits its footprint is currently ‘a bit small’.
Shell’s fellow British firm BP also reported its highest profits since 2014, doubling its net profits for the full year 2018 on a 65% jump in 4Q18 profits. It completes a long recovery for the firm, which has struggled since the Deepwater Horizon disaster in 2010, allowing it to focus on the future – specifically US shale through the recent US$10.5 billion purchase of BHP’s Permian assets. Chevron, too, is focusing on onshore shale, as surging Permian output drove full year net profit up by 60.8% and 4Q18 net profit up by 19.9%. Chevron is also increasingly focusing on vertical integration again – to capture the full value of surging Texas crude by expanding its refining facilities in Texas, just as ExxonMobil is doing in Beaumont. French major Total’s figures may have been less impressive in percentage terms – but that it is coming from a higher 2017 base, when it outperformed its bigger supermajor cousins.
So, despite the year ending with crude prices in the doldrums, 2018 seems to be proof of Big Oil’s ability to better weather price downturns after years of discipline. Some of the control is loosening – major upstream investments have either been sanctioned or planned since 2018 – but there is still enough restraint left over to keep the oil industry in the black when trends turn sour.
Supermajor Net Profits for 4Q18 and 2018
- 4Q18 – Net profit US$6 billion (-28%);
- 2018 – Net profit US$20.8 (+5.7%)
- 4Q18 – Net profit US$5.69 billion (+32.3%);
- 2018 – Net profit US$21.4 billion (+36%)
- 4Q18 – Net profit US$3.73 billion (+19.9%);
- 2018 – Net profit US$14.8 billion (+60.8%)
- 4Q18 – Net profit US$3.48 billion (+65%);
- 2018 - Net profit US$12.7 billion (+105%)
- 4Q18 – Net profit US$3.88 billion (+16%);
- 2018 - Net profit US$13.6 billion (+28%)