In our previous post on FintechFans (“An insightful overview of what we do”), we had a brief overview of how the platform came to exist, what it is and what it does.
Today we will take a look at why a decentralized recruitment platform is necessary in today’s market.
We know FintechFans is that all-important link between FinTech employers finding specialized talent, and candidates finding their ideal FinTech job.
But there are several issues within the traditional recruitment industry that could mean a decentralized platform is, in fact, the only way forward.
Recruiters are the all-powerful man in the middle
The problem with centralized platforms is that there is normally a single entity that controls the entire flow of operations. This means they have complete command over how things are done, which can often be to the detriment of customers.
Traditional recruiting is no different. Both sides of the job market approach them to either find that perfect job or skilled employee. There’s therefore a high degree of trust necessary.
But how do you, as an employer know that the recruitment agency is sending you the best candidates? You can only select the best candidates from the pool that they send you, but that is still a limited pool.
And how do candidates know recruiters are showing them all the opportunities available according to what they are looking for? They might just be showing them the places where they are more likely to find a job in order to ensure their commission and placement fee.
High recruitment fees
If we take the UK market as an example, the average recruitment fees can range between 10% and 26% of the candidate’s salary.
And companies are responsible for all the fees.
If you consider that the average London salary is close to £40K, you will pay over £10,000 in fees before you’ve even started paying the actual employee salary.
There are also different fee structures depending on the type of placement, which can be quite complicated.
This includes Temp fees, temp to perm fees and permanent fees.
Often times, when a candidate signs a temp contract, instead of the company paying the employee directly, they will have to pay the employee’s salary to the recruitment agency with an additional percentage on top.
This is not only expensive but adds another unnecessary loop into the cycle.
Less than ideal communication
Traditional recruiters tend to be very secretive about the candidates that they have in their network as well as the companies that they recruit for. The reason for this is that they want to ensure that they get paid for placing a candidate.
In order to do that, they can’t share their candidate with other recruiters (so immediately the candidates’ choices are limited) but they also don’t want to share their client’s details with other recruiters in case someone else fills the role with a candidate before them (again, this places a severe limitation on the companies choice of potential employees).
The issue is that neither side can be 100% sure that they are being shown the full picture and this creates a lack of trust between all parties involved.
A decentralized recruitment platform is the answer
A decentralized marketplace removes the need for a man in the middle overseer. This means that the control is placed firmly in the hands of the companies and candidates, not someone else making decisions on their behalf.
And because there’s no need for a third-party provider, expensive recruitment fees are automatically reduced. These fees could be put to better use such as paying for additional job advertisements in order to attract a wide a pool of candidates as possible.
And finally, a decentralized recruitment platform will put employees in direct contact with candidates for secure and transparent communication.
This is very important as it can save a lot of time, hassle and money in the long run by ensuring both the employer and potential candidate make the right decision.
In our next post, we will look at the specifics of the FintechFans Decentralized Marketplace solution and our value-add in addressing the above recruitment woes.