Difference Between Internal Recruitment and External Recruitment

Main Difference

The main difference between Internal Recruitment and External Recruitment is that Internal Recruitment is a process of filling job openings or vacancies with current employees from within the organization, and External Recruitment is a process of filling job vacancies with fresh candidates from outside the organization

Internal Recruitment vs. External Recruitment

Internal recruitment is a procedure whereby the employees are hired or recruited from within the organization while external recruitment, is a process in which the recruitment is done using outside sources. Internal Recruitment does not promote freshness, new talent and new idea, and external recruitment promotes and attracts freshness, new talent, and new idea in the organization. Internal recruitment requires less cost and time to recruit candidates internally, whereas external recruitment is a more costly and time-consuming method of recruitment. Internal recruitment is a very simple method of filling vacancies, and external recruitment is a complex method of recruitment. Internal recruitment does not require induction training because candidates are already familiar with the organizational environment, and candidates are recruited based on seniority and merit, on the other hand, external recruitment requires induction training for fresh candidates and candidates recruited based on merit, experience, and qualification. Internal recruitment process motivates current employees, which promotes better performance and job satisfaction; on the other hand, the external recruitment process may demotivate the existing employees in the organization. In internal recruitment, limited choice of competent human resources is available, and in external recruitment, more choice of competent human resources is available.

Comparison Chart

Internal RecruitmentExternal Recruitment
Internal Recruitment includes recruiting candidates from those who are already in employment within the organization.When the recruitment of candidates done externally, then this type of recruitment is known as external recruitment.
Origin
Transfer, promotion, mentions or references, etc.Advertisement, random callers, employment agencies, management consultant, recommendations etc.
Basis
Merit cum seniorityMerit cum qualification
Induction Training
Not requiredMust
Choice of Candidates
LimitedUnlimited
Time is Taken
Quick processLengthy process
Cost
It is a cost-effective process.It is a costly process.

What is Internal Recruitment?

Internal recruitment is the procedure of filling the vacant positions in a company by the employees under the business premises. In simple words, it understood as the method where the existing workforce of the company is referred or taken into consideration for any available suitable post.

Methods of Internal Recruitment

  • Employee Referral: In companies, there are workers or employees, and then there are supervisors who assess their performances. The supervisors keep a proper record of every employee. In time, when the company needs human resources, these records are reviewed, and the most hardworking or potential employees referred for the vacant posts.
  • Promotion: Promotion is the deed or act of advancement of employee’s post in the company. In some organization, it is mandatory; it means that employees are promoted in a certain interval of the period, while in others, employees promoted as per their performance.
  • Transfer: on a large scale, organizations have several branches, human resource need of one branch fulfilled by the human resource of another branch. Under this method, human resource needs at any branch identified at first. Information about the vacancy then distributed in all the branches, following which, interested and suitable candidates transferred.

What is External Recruitment?

External recruitment is the procedure of filling vacant posts of the company by the employees, excluding the existing ones. New people with the required skills and qualification enrolled in the organization, and thus, new ideas initiated in the company.

Methods of External Recruitment

  • Advertisement: Advertisement is the most broadly used method for external recruitment. Companies declare vacancies through electronic and print media such as newspaper, magazines, television, radio, and the internet.
  • Walk-ins: Walk-ins are those who get in the organization in search of a job. This method applies to unskilled and semi-skilled posts.
  • Private Employment Agencies: Private employment agencies operate or work as a middleman between prospective employees and companies. They maintain a databank of job vacancies as well as job seekers and make a perfect match. Such agencies charge a commission for rendering their service.
  • Educational Institutes: These days, most of the companies have started the trend of conducting direct recruitment from colleges and universities. Companies visit educational institutes annually and hire bright students, especially at the managerial level. This saves time and money and urges students to study hard.
  • Labor Contractors: They maintain regular contact with laborers and industries and provide the industries with laborers when required. They also charge a commission for their service rendered.

Key Differences

  1. Internal Recruitment relates to a source of recruiting human resources, which are already existing within the organization. External Recruitment is a bit different as it includes the hunting of prospective employees from outside the organization.
  2. Internal Recruitment is rapid than external recruitment because external recruitment involves stages like advertising and inviting applications, screening of applications, shortlisting, conducting an examination and interview, selection, placement, training, testing, induction, etc., which are not present in internal recruitment.
  3. Internal Recruitment is a cost-effective procedure. However, External Recruitment needs a large amount of investment.
  4. Internal recruitment does not need induction training, whereas, in external recruitment, induction training is a must.
  5. The ground for internal recruitment is merit-cum-seniority, but the ground of external recruitment is merit-cum-qualification.
  6. In internal recruitment, the choice is very small or restricted, i.e., the scope of fresh talent restricted. On the other side, when the company opts for external recruitment, it can hope for talented candidates from outside the organization, which means new blood and ideas infused in the organization.

Conclusion

If an organization has a good employee base, then it can choose an employee for the vacant position from within the organization, however, if no employee suits best on that position, then it can employ external sources of supplying personnel.

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