External Factors Affecting Recruitment

The external forces are the forces which cannot be controlled by the organisation. The major external forces are:

1. Supply And Demand
The availability of manpower both within and outside the organization is an important determinant in the recruitment process. If the company has a demand for more professionals and there is limited supply in the market for the professionals demanded by the company, then the company will have to depend upon internal sources by providing them special training and development programs.

Performance Appraisal is Better Than New Recruitment

2. Labour Market
Employment conditions in the community where the organization is located will influence the recruiting efforts of the organization. If there is surplus of manpower at the time of recruitment, even informal attempts at the time of recruiting like notice boards display of the requisition or announcement in the meeting etc will attract more than enough applicants.

  1. Image / Goodwill
    Image of the employer can work as a potential constraint for recruitment. An organization with positive image and goodwill as an employer finds it easier to attract and retain employees than an organization with negative image. Image of a company is based on what organization does and affected by industry. For example finance was taken up by fresher MBA’s when many finance companies were coming up.

  2. Political-social- Legal Environment
    Various government regulations prohibiting discrimination in hiring and employment have direct impact on recruitment practices. For example, Government of India has introduced legislation for reservation in employment for scheduled castes, scheduled tribes, physically handicapped etc. Also, trade unions play important role in recruitment. This restricts management freedom to select those individuals who it believes would be the best performers. If the candidate can’t meet criteria stipulated by the union but union regulations can restrict recruitment sources.

  3. Employee Retention is Better Than New Recruitment

  4. Unemployment Rate
    One of the factors that influence the availability of applicants is the growth of the economy (whether economy is growing or not and its rate). When the company is not creating new jobs, there is often oversupply of qualified labour which in turn leads to unemployment.

  5. Competitors
    The recruitment policies of the competitors also effect the recruitment function of the organisations. To face the competition, many a times the organisations have to change their recruitment policies according to the policies being followed by the competitors.

  6. Last Updated: 05/05/2015