New research reveals that ineffective talent acquisition strategies are stunting business growth, with one in four business leaders admitting their company’s expansion is being held back by flawed recruitment processes. The findings, from a survey conducted by enterprise hiring software provider SmartRecruiters, show the growing concern among businesses in the UK, US, and Australia over how they acquire talent. The report highlights that 34% of leaders are uncertain if they have hired the right people, and more than half believe their current strategies are insufficient.
The survey, which interviewed 500 mid-sized companies, found that despite significant investments in talent acquisition, many businesses are failing to get it right. Over half (51%) of respondents said their approach to recruitment was lacking, with a third acknowledging that this was damaging their brand reputation. These struggles come despite businesses dedicating substantial time and money to the process.
High Costs and Time Drains
The cost of talent acquisition is proving a major burden, with 63% of businesses spending at least 40% of their overall HR budget on recruitment, and nearly a quarter allocating over 60% to these efforts.
Business leaders are also spending a significant amount of their own time on recruitment, with 44% stating that more than half of their working hours are consumed by talent acquisition tasks. This heavy workload is diverting attention away from core business operations, leaving many companies unable to focus on key growth initiatives.
The research suggests that businesses are missing opportunities for profitability as a result. In fact, 62% of those surveyed believe they would be more profitable if their talent acquisition strategy was improved, underscoring the inefficiencies in current recruitment approaches.
Impact on Business Performance
The report also highlighted that the consequences of ineffective hiring extend beyond immediate operational challenges. Leaders pointed to slower business growth (28%), a damaged brand reputation (30%), reduced service quality (28%), and weaker sales performance (29%) as direct results of poor recruitment practices.
Additionally, 56% of respondents said that talent acquisition has become significantly more difficult in the past five years, citing factors such as the rise of remote and hybrid work, global workforces, and increased competition for talent. In fact, 30% of business leaders said recruitment is the most complex part of their operations today.
A Call for Modernisation
Rebecca Carr, CEO of SmartRecruiters, emphasised the need for businesses to modernise their recruitment strategies in light of the survey’s findings. “This research makes it clear that HR teams must rethink how they approach talent acquisition if they want to drive business growth and profitability. Advanced technologies, particularly AI, are transforming how companies can streamline recruitment, making smarter, data-driven hiring decisions.”
Carr noted that AI-driven platforms are no longer a luxury but a necessity for businesses looking to stay competitive. “By embracing AI-powered hiring platforms, companies can reduce costs, improve the quality of hires, and deliver better business outcomes. It’s the future of recruitment, and businesses must adapt to succeed in today’s increasingly complex hiring landscape.”
SmartRecruiters, which serves over 4,000 customers globally, including LinkedIn and Visa, aims to help companies overcome these challenges through its AI-powered hiring software. The platform allows businesses to make more informed, cost-effective hiring decisions, helping them achieve long-term growth and success.
For more information, visit www.smartrecruiters.com.