internal hiring vs external hiring.

1166 WordsApr 3, 20145 Pages
Name: Syed Sarfaraz Khan Student ID Number: 110074184 Assignment number: 1 Introduction: When an organization announces a vacancy or an open job position then it can be filled by either someone internally from the company already working in another position or externally by somebody who is new to the business. For this firms need to consider different methods of hiring and try to create a pool of potential candidates with relevant skill level. There are pros and cons to both internal and external hiring. In the current economic scenario, companies look cut costs by hiring within their four walls rather than from the outside. it has been estimated that cost on finding and hiring someone externally…show more content…
Another factor which is considered by the employers while hiring is the wage differences between external and internal recruited employees. Hassink et al. (2008, p. 715-730) States that a risky external worker receives a much higher wage than a safe internal candidate of equal ability or productivity. Much of study shows apparently that externally hired workers get payed more but in fact the difference in wage between external candidates from other employers and internal candidates disappears if we consider the workers observable characteristics. Bassi (2000, p.22-23)has concentrated on a fairly new concern regarding staffing and states that in political context, internal movers can create and ginger hostile atmosphere as a result of political wrangling which external candidates can minimize it. Furthermore, he insists that external employees may take time to fullfill staffing needs when an organization opens new branches and market outlets as compare to internals who will be much faster in adapting to the administrative machinery. DeVries (1988, p.749-462), defines succession as board’s choice of an internal and external appointment can be affected not just by rational organizational requirements

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