Leading Job Boards Address Challenges of Globalization

By Jonathan Pont

Nov. 15, 2005

I n recent months, the number of new job listings appearing on the Internet’s most heavily trafficked job boards–CareerBuilder, Monster and Yahoo HotJobs–eased just a bit from recent 18-month highs. But for the companies, collectively known as the Big Three among recruiters, news indicated they were hardly slumbering.

    Each announced changes in operations that hint at the direction of the Web’s top employment sites, whose collective revenue zoomed past $1.2 billion in the last year. And without saying as much, the changes may be responses to issues that recruiters deal with on a daily basis. Among them: globalization of the workforce, the dilemma of postings that yield too many responses–including applications from people who clearly aren’t qualified–and the seemingly endless number of Internet sites where recruiters can list jobs.

    The shifts come at a time of sustained growth for the companies. In the second quarter of 2005, CareerBuilder and its online partners at newspapers took in $121 million. Monster reported revenue of $198 million in the second quarter, up 40 percent from a year earlier. In July, the number of paid job listings on HotJobs rose 58 percent from the same month in 2004, to 152,415, according to Web tracking firm Corzen. (HotJobs does not disclose revenue.)

    The figures underscore just how much recruiters continue to rely on the Big Three.

    “We need to be on the boards,” says Greg McElroy, director of staffing for defense contractor Northrop Grumman in Herndon, Virginia. The company, with $5 billion in annual revenue, employs 22,000 people and will fill 5,700 positions this year. “It’s a branding issue,” McElroy says. “The candidate pool needs to see that we’re active in the job market.”

    Critics say job boards impede recruiters’ efficiency and don’t necessarily help companies find the best talent. “There was a promise that the Internet would be a panacea for recruiters,” says Lou Adler, president of the Adler Group, a hiring company in Irvine, California. Rather, “it has dramatically increased the number of candidates coming in.”

    So while Northrop Grumman feels the need to have a presence on the boards, McElroy acknowledges that the company doesn’t have the resources to answer all the responses a major job board listing generates.

    That type of complaint might not elicit sympathy from executives at CareerBuilder, where, as CEO Matt Ferguson explains, “We provide eyeballs. Those eyeballs translate into applications and hires, and that’s what companies pay us for.”

    But as recruiters gain familiarity with startup companies like Jobster, mkt10 and H3, which offer Web-based solutions that mimic the very effective employee referral programs that companies love, a clear response was in order. In their own ways, the Big Three boards are answering their markets’ calls for change and innovation.

    One response is technology, and Ferguson is passionate when he talks about CareerBuilder’s commitment to it. The company’s site features a bevy of new functions that are consistent with current Internet usability trends. It has added RSS technology, which replaces e-mail alerts and lets users receive news of job listings through a customized feed. The company is putting the finishing touches on an application designed for cell phones and other wireless devices. It intends to introduce that feature this fall.

    Over the summer, CareerBuilder announced a significant tweak to its core job listings function. The new capability allows job seekers to see openings that a computer algorithm recommends, based on information contained in their résumés. Users can still launch a search by keywords for a job in a particular location or industry, but the new matching function capitalizes on developments in search technology that will shape the way job seekers utilize all of the Big Three job sites in the years to come.

    In theory, the matching capability could deter job seekers from applying for jobs for which they may not be qualified. By showing listings most relevant to job seekers’ skills, experience and location, the new technology is ostensibly a step toward unclogging recruiters’ inboxes.

    Richard Castellini, CareerBuilder’s vice president of consumer marketing, says initial figures show that job seekers who use the new feature, which the company announced on July 25, are applying for jobs at a higher rate.

    Delivering more of the right candidates may not ease recruiters’ headaches with résumé volume in the short term, but Castellini says that the company has an easy fix for that: technology that companies can request to block candidates. If deployed, the mechanism would turn the résumé torrent into a trickle.

    “Clients have said they get an abundance of responses,” Castellini says. “But when you talk to them about turning off those responses, they never want you to turn them off.” He says customers have used the issue as a negotiating ploy to get a better price for the company’s services.

Search party
Yahoo HotJobs might have a smaller audience than its Big Three competitors, but it is part of one of the most well-known consumer brands and the top destination on the Internet. The relationship allows it to make use of proprietary research about how people use the Web and to incorporate it into the HotJobs business.

    One recent conclusion was drawn from its ongoing observation of how people use the Web, says Dan Finnigan, HotJobs’ executive vice president and general manager. Users want more results from a search, whether for a digital camera or a job. “The expectation of the Yahoo user” is that the service will “search everything that’s out there,” Finnigan says.

    In July, HotJobs began to show job listings from all over the Web, in addition to the ones it lists for a fee. This introduced the notion that perhaps the paid job listing was no match for the proliferation of corporate recruiting sites and niche sites, and some observers predicted that paid job listings might be on their way to the desktop trash bin.

    “We are a vertical search engine for jobs,” Finnigan says. “It seemed like a natural extension for us to use that database of Web sites we crawl all the time, and re-crawl them for whether they have jobs or not and make that available for the user.”

    That includes job listings from a growing number of corporate Web sites and niche sites, which total about 100,000. When Yahoo formed in 1995, there were about 100.

    The long-term impact on HotJobs or its larger competitors isn’t known. Bruce Murray, president of Corzen, a market research firm in New York, says paid listings may have more credibility with job seekers simply because the results from a search may show results that have expired or lack the formatting and appearance of a paid HotJobs listing.

    HotJobs is not the only company betting on this all-in-one model. SimplyHired and Indeed are new services that essentially act as search engines for job listings. They collect postings from as many as 1,000 Web sites and place them, free of charge, in one place for job seekers to peruse.

    The New York Times recently invested $5 million in vertical search company Indeed and incorporated it into its own site to help power its job pages. Listing search results from Indeed greatly increases the number of jobs Times users will see on the site, from 5,000 to about 110,000.

    The concept isn’t new. Monster bought Flipdog, an early aggregator, in 2001. But having the biggest and most comprehensive job search engine on the block could drain job seekers from the major boards.

Going the distance
    Though Monster generates more revenue than its competitors in part because of services like the applicant tracking system it sells to small and medium-size companies, its core business remains job listings. These days, that business is growing fastest overseas.

    In the second quarter, the company’s international revenue grew at twice the rate of its domestic revenue. International revenue constitutes 23 percent of Monster’s gross. With purchases during the past year in India, South Korea and France and a minority interest in, Monster now has a presence in more than 25 countries.

    The biggest users of services like the one in China are U.S.-based multinational businesses looking to recruit local workers, says Steve Pogorzelski, group president, international, for Monster.

    Typically, companies buy licenses from Monster that allow them to search résumé databases on a country-by-country basis.

    Kent Kirch, director of global staffing for financial advisory firm Deloitte Touche Tohmatsu, which employs 115,000 people in 148 countries, says the firm’s recruiters use the service to search for expatriates who may be willing to come back to the U.S. for the right opportunity.

    The firm, which ranks among companies that post the most job openings on the Internet, will make about 500 hires this year in 12 foreign countries, he says.

    Though Monster’s brand is practically unparalleled with American companies, it does not enjoy the same recognition in Europe or Asia. Analyst Mark Marcon says the company faces challenges in Europe. The newspaper industry there is better prepared for a Monster attack, having watched Internet recruiting play out over the past decade. Job turnover rates tend to be lower than in the U.S. And, finally, free job boards enjoy government sponsorship.

    “A lot of our businesses in other countries have been in startup mode over the past five years,” Pogorzelski says. That’s allowed them to develop what he characterizes as “guerrilla” marketing techniques, and to maintain close relations with customers.

    Pogorzelski says that transporting the company’s technology and sales force overseas is one of his primary tasks. But he also expects the North American division to learn what works best overseas, and incorporate those lessons.

Workforce Management, November 7, 2005, pp. 49-51Subscribe Now!

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