Recently, RNN spent time with Steven Rothberg, President and founder of College Recruiter. In this last half of our conversation, we talk about how campus recruiting is changing thanks to a pandemic - and how that's actually a good ting.

The transcript which follows has been edited for clarity and brevity.

Steven Rothberg 

One of one of the most encouraging things that I've been seeing over the last couple of years in our industry is a real shift from employers and their advertising agencies using data to justify decisions, to instead using data to make decisions. And a great example of that, in in the last year, there's been much more transparency in our industry, between the employers, their applicant tracking systems, their advertising agencies, etc. And the job boards, we now get from most of our customers on what's typically called the ecpa, the effective cost per application. If an employer spends, say, $1,000 with us, and we send 1000 clicks to the employer site, and 100 of them apply, which would be a reasonable number, you know, the effective cost per application is $1,000, divided by 100 applications. So you're spending $10 per application, you know, for a retailer, that's pretty good. You know, if you're hiring engineers, and you're a defense contractor, that would be unheard of, that'd be like an amazing athlete. So positions that are more difficult to hire for nurses, they're going to have a higher average cost per for per application, we're now getting that data. Some of our customers are dragging their heels, some of them literally don't have it.

Others are loath to share it. But when we get that data from, say, an advertising agency, or from an employer, we can then do something about it. You know, it's one thing for an employer to soar their representative to say, You're too expensive, or you're really cheap. But you don't know what that really means. If an even if it's really, actually truly worth you're just making it up. 

Martin Burns

That's context. 

Steven Rothberg  

Yeah. But when they tell you ahead of time, you know, hey, the target for this kind of job is $25 per application, you know, anything less than 20, you guys are doing amazing. Anything more than 30 or 35, we need to talk and if it's sustained, if it keeps going like that you're going to lose the business. That's awesome. Because then when we start delivering traffic, if we see we're at $42, we know we have a problem. And we really need to figure out what is causing candidates, we're sending the wrong candidates. So we need to figure out then what the right candidates are. On the other hand, if we're at $22, and they're looking for 25, then what we know is we're sending the right candidates now we just probably need to send more of them. 

Martin Burns  

Sure. 

Steven Rothberg  

And that's, that's really helpful that increased transparency, using actual data is a game changer. For our industry. 

Martin Burns 

There's definitely a rise in data geeks in the industry, in general. We're seeing more and more people who work that way - a lot of sourcing and whatnot. They're just more focused on actual data - numbers and metrics. And you're seeing some employers assigning data scientists to work in support of talent acquisition, for this reason. 

Steven Rothberg  

Yep. I'm seeing a lot more people going to work for ad agencies and job distributors. And even in TA functions, where you look at them. It's like, okay, there. You can see from the photo, they're probably 21-23 years of age, and what's their major? It wasn't HR, it wasn't communications - it was math, statistics, economics.

10 years from now, I think we're going to look back and ask how is it ever possible that just because a job board run an ad ran an ad on a Super Bowl, that they got all that all that ad revenue, if they couldn't produce the results, right? It's got to be data driven. I would really like to see actually, rather than looking at the average cost per application, I'd like to see the standard be around average, the effective cost per interview. To me an interview is a much better metric of success of quality, right? 

Martin Burns 

There's something that we use at HireClix - well, I say "we". Full-disclosure HireClix owns RNN - we're a wholly owned subsidiary. The approach is with every client, you sit down with, and want to understand, what do they consider a quality applicant? It's always individual, right? Because you may have your 5 steps in your process or it may be 50. But at what point in that process do you say "this person, if they made it this far, they must be good, even if we don't hire them." The fact that the board produced someone who reached this point means they're doing their job right. You may have, say, 10 people reach that point and one gets hired, and it may be the that person was produced by job board A that gave you 1000 other non-quality applicants, while the other 9 came from job board B that only gave you 90 applicants. Job board B actually did a better job when you think about it. A just got lucky via volume, but that volume of job applicants swamped your recruiters. 

Steven Rothberg 

I definitely understand from like a corporate HR talent acquisition standpoint, whether your initial reaction would be will, quality is a hire, right? Because that's what we want to do, just like you articulated, the job board or other source, whether it's an executive recruiting firm, a staffing company, referral program, whatever, right? In a sense, at the end of the day, we're all kind of like a bus, right? You want to get qualified candidates onto the bus and deliver them to your doorstep. But at that point, your talent acquisition function takes over, you've got to do the screening, you've got to do the selection. And if your CEO decides to hire her nephew, for that job, it doesn't mean that the job boards and everybody else did a bad job. Just because there wasn't a hire, it's because your CEO was playing the game of nepotism. But if the recruiter felt like that person was worth the time to do a 10 minute phone interview, then that means that there's like some objective measure of quality. We don't get that kind of data from virtually any of our customers the effective cost per interview, it's just it's just not a standard that I see being used much. I'm sure there are some organizations that are doing that - and hats-off to them, because they're leaders. 

Martin Burns 

We think it's important because because when you really do get it it works, it just takes a bit of education with the client. So you understand what they're looking for, and why. It helps guide their spend too. So if you see, even earlier on  - even before the hire happens, if you if you know that job boards are producing, some people are hitting the quality level, consistently, you keep investing money there, if a job board or another source is producing no one that gets to quality, dial back a bit. Adjust your money. So even during the process before the hire happens, you can really start fine tuning, because you have a measure or a gate that's earlier in the process before the hire even happens, you can look at and kind of judge from if the campaign and source makes sense to keep investing in.

Steven Rothberg 

Scale matters, too. One of our customers have a growth opportunity, they're going through a period where they're really scaling up. They were hiring, over the course of a typical quarter, about 50 people. So decent hiring volume, but not not anything to write home about compared to a lot of companies - Amazon probably hires 50 people in an hour. But our client wants to increase that to 5000 people every quarter - and they want to do that in the next three to six months. Tthat's crazy exponential growth. They can do it. But they're they're gonna have to understand, and they have to come to grips with that it's going to cost them a lot more per hire. What they've been doing so far is picking fruit from the bottom of the tree, the lowest of the low hanging fruit. And it's pretty easy to reach up to an apple tree and grab that apple, right. But when you start going further up that tree, you need to have a ladder, and you know your systems have to be different. So they told me that their effective cost per application in 2020 last year was 50 cents, which is super cheap. And the reason is that most of it was just organic, it was free. Well, if you want to stay at 50 hires a quarter, you can continue to pay 50 cents per effective application. But if you want to go to 5000 people you're probably going to have to pay 20 bucks per application for the kind of jobs they have available. That's something that, if your background was economics, statistics, math, whatever, would be intuitive to you. But if you've been in a more sort of traditional HR role growing up with post and pray, it's hard to grasp that. Most businesses talk about economies of scale, the more you buy, the cheaper it is, but when it comes to lead generation, getting people to apply to your jobs, the opposite is true. There's diseconomies of scale, it's harder and harder, more and more expensive to find those candidates when you scale up.

Martin Burns  

There's The Mythical Man Month by Brooks. It's a classic introduction to computer science text. Your first year math and computer science majors used to read it. It's idea is that there used to be this this this theory that a man month is how you measure software development time. (It's a sexist term - I know.) But the idea was you'd measure effort. If it takes five people to build some kind of software per month, if we put 10 in it's cut in half, 15 it's a third, etc. But that's not true. Because the more you put in, the more complex it gets. Hiring is harder. People run into each other, and you only do so much at a time. So it doesn't scale up the way you expect.

Steven Rothberg

Right? And that's okay, because there are other benefits, right? You know, so if you've got three developers, and one is kind of the team lead. And so you've got three people basically coding almost full time. You don't need to have a manager, right. But now you want to have, say, six developers, eight developers, you're definitely going to have to have a manager and that person is not going to be coding,

Martin Burns 

Because, there's training, there's hiring, there's management, they're also tripping over each other...

Steven Rothberg

Right? And then and then you need, you know, you need Toby from The Office, you know, in HR, who's then just, you know, a really nice, really competent guy, and that's why his boss dislikes him.

Martin Burns

So that's interesting. I do think that to your point, looping back a bit: we're seeing smarter and smarter, or really just more educated consumers, who are getting more sophisticated with understanding how traffic works, how to measure it, how to push back on job boards to and they know what they're looking for. 

Steven Rothberg

Yeah, it's it's not the beauty pageant, that it was 10 or 20 years ago. Thank goodness. The questions that we get asked now by potential customers are much more well thought out. I think they had a lot of BS handed to them for a lot of years by some of the biggest players. Chief amongst those is, how much traffic do you have? We still hear that one. My answer to that is, who cares, right? If we have 5 million people a month using our site, and nobody applies to your job? How does that help you? If we have 50,000 people a month using our site? And you get every single person that you need from us? Isn't that better? The whole quality of traffic? The whole "how much traffic Do was a brilliant way for Monster to market itself because they had way more traffic than anybody else did 20 years ago. And so that was a cheap selling proposition for them. So they use that and they convinced a whole generation of customers, that traffic is all that matters. Now, there's sort of a new generation, and sometimes it's the older, more experienced people who just are looking at this in a better way. And they're looking at it more like metrics, like effective cost per application, you know, and hopefully, if we talk again, in a couple of years, it'll be an effective cost per interview. That kind of thing matters a lot more than just how many eyeballs are there. It used to be rare. Now, if we're talking to a customer, it's rare that they don't have a base at least a basic understanding of pay per click. Five years ago, almost none of them understood pay per click at all. And that's also great. It aligns our interests more with the employers, if we're paid per click, we're paid for delivering to them a candidate, hopefully, of good quality. And that's better than just running an ad, you're running at a distance, like what does that mean? Even to the extent of sending a lot of clicks, it's not that great of a metric, because that's just quantity over quality.

Martin Burns 

And, you still the bot problem, and everything else too. I think it's the analogy is, you could drive by a car lot. And it's full of people, and they look like they're doing amazing, cuz there are lots of folks in there, but everyone, they're looking to buy a bicycle. But from a distance, it looks like they're really busy. And maybe they'll go for a test drive because they're there, and "why not go for a test drive in a car, but I can afford a bicycle. But while I'm here, I'll drive your Lamborghini", but they're never gonna actually buy it. So the conversion point matters and understanding and seeing that happen and getting a bit deeper into it. So if you can get access to the business manager's office to see what deals are being closed, what cars being sold, then you're measuring success.

Steven Rothberg

Yeah, you're getting closer and closer and closer to what matters. Is their success the same as my success? And yeah, that definitely matters a lot.

Martin Burns 

So we're getting really geeky here. I hope we haven't lost people. But that's it. So I did want to jump into this: we're in this very, I guess, "interesting time" in our society, in our global society, our civilization. There are lots of changes. Because of that. Everyone's home everywhere. Everyone's isolated. Everyone's talking like this on Zoom. Well, maybe Steven, maybe I'll see you this year. I don't think I will. But maybe I will in person. But Campus is an always interesting problem in general, for recruiting. It's got to be fascinating this year. So what's happening in 2021? With campus recruiting, that's what changes have you seen, how are people adapting, what are they looking for?

Steven Rothberg

I think it truly is fascinating. I mean, whether you're like a data person or not a data person, there's absolutely no doubt that probably the biggest change in campus recruiting, there's the biggest change going on right now that there ever has been, and it's really flying under the radar. So, until a year ago, it was pretty well recognized that the vast majority of college students and recent grads went to work for large employers. There’s this belief - it's not true - but there's a belief that most people work for small businesses. If you take out all of the businesses where it's just one person, where they're just actually working for themselves, if you take those out, most people actually work for medium and large-sized businesses. And it's even more so with college students and recent grads, far more than go to work for a Walmart or Target, than for a little startup in San Francisco. The largest employers overwhelmingly hired most of those students and recent grads through their internship programs. If you're a student, and you graduate without a job, it is far less likely that you're going to find a good career-related job, just applying online versus, your roommate who found a similar job through her internship. Internship was like, that was the path to success both for the employer and the candidate. The vast majority of interns were hired on campus, recruiters, hiring managers flying around the country, wining and dining professors taking Career Service Office, people to football games and all sorts of stuff to curry favor and the average cost per hire for a student, according to NACE, the National Association of Colleges, employers was about $6,400. That's a lot of money to pay for a typical 20-21-year-old with little to no work experience, who is working towards a college degree, probably will graduate with one but not necessarily, and there's really no proof that that person is gonna be able to do a good job for you. They have no demonstrated ability to stay with an employer for more than a few months. You're taking a big chance by hiring those people, but that's the way college and university recruiting worked. Why did it work that way? There was this huge inertia. College recruiting until 2000 was pretty much the same as it was in 1952. You just drove around, flew around the country, and went campus to campus to campus to campus. If you needed to hire more students, you went to more campuses. And very few employers would even count their travel and staff costs in their effective cost per hire. So they'd say, "Oh, well, the, you know, the school charged is $500 to go to a career fair, and we hired two people. Cost Per hire is $250." But, no: you flew four people halfway across the country, they spent four days out of the office, they stayed at a Hilton at $175 a night, they rented cars, you gave them $120 a day for meals. And they also went to a San Francisco 49ers game with three professors, and that was $2,000. So you're actually paying $8,000 per hire. And there was a lot of inertia built up and a lot of featherbedding, a lot of these people that were doing all that traveling really liked it. And so they were really reluctant to change it. Then COVID comes along. And COVID basically says: you're not going to fly anywhere. But these companies still needed to hire people. So they ended up shifting from flying people around the country to doing it almost all online. And lo and behold, cost per hire goes from $6,400 to about a tenth of that.

I think what we're gonna see next fall when campuses really start opening up again, you're going to have most students at the school, rather than working remotely from their parent’s basement halfway across the country. I think what we're going to see is the pendulum shifting back some but not nearly all the way. You will have more employers going on campus than in 2020. You'll have more employers hiring more people on campus in 2020. But nowhere near what 2019 had and before that. It is faster and cheaper - by far - to hire that student through a job board, through an online career fair, through referral programs, whatever, than to go on campus, because there's far less staff time and there's no travel cost involved. You know, your coworker, Kara Yarnot. When she had her own company, she hosted a conference and I was moderating a panel discussion. One of the panelists worked for I think it was Lockheed Martin, he was a university recruiter. We were talking about on-campus versus online. And he said that their cost to their average cost of hiring somebody online is 1/10 of what it was through going out to campuses. And so I'm thinking, "Okay, now he's gonna drop the other shoe". Now he's gonna say, however, we do most of our hiring on campus because the quality is higher. And he says, basically, "you know, don't tell anybody I said this [my words], not his, but the quality is better online". And I thought for sure I had misheard him. So I asked him the same question again, but in a different way. And he's like, no, the quality is better online. Okay, why are you saying that? Because if they hire somebody on campus, chances are they're an elite student from an elite school in a highly sought-after major, you know, computer science from MIT. And they are probably gonna be with us for a year or two. If we hire somebody online instead of on campus, then they probably go to a second or third tier school, and they'll be with us for five years, or seven years, or 10 years. And so their productivity is higher. Also, if we hire on campus, it undermines our diversity hiring efforts. Because if we hire from 20 schools, everybody has gone. They've lived in the same metros, they've gone to the same schools, they've had the same textbooks, they've had the same professors. They all have the same way of thinking. If you open it up, and you hire most people online, now you're hiring from 2000 schools. So by definition, it's more diverse. It blew me away 

Martin Burns

You may be a genius, but if you can't afford to go to MIT, Harvard, without a scholarship. So you're going to go to a school that maybe is less well known, but you are high quality you just can't be found. You're not in the right place geographically. That's really interesting.

So I think I I think what we're gonna see if your company is hiring, trying to hire say 200 interns this year, two years ago, you would have gone on campus, you would have hired 190 of them from, say, 20 schools. This coming year, I think most of those companies will go from, say, 20 schools to 10. And instead of hiring 190 of the 200, they'll hire maybe 50 on campus, and 150. online. Again, I think that pendulum is gonna switch back some, but not all. I'm biased. Clearly, that helps us. But there are also others out there saying that too.

Martin Burns 

But I don't think you're incorrect either. I do think that the returns may be a lot more hybrid, for all kinds of reasons, and all kinds of roles and situations. And I do think campuses will definitely be one of them. I'm thinking about the Big Four accounting firms at heart  - even if they do consulting and systems work, etc, but at their heart, they're accounting firms, and they're always measuring dollars and quality. And if they're seeing that the quality doesn't dip or possibly improves, and the costs go down, it will become very hard for Campus to get budget back to travel as much as they were. Because all of a sudden, there's data. And it's hard to argue against that truth.

Steven Rothberg 

Yeah. But if you've got 50 people in your university recruiting department, and you're the university recruiting director, and you've got basically 50 people who are reporting up to you. It goes against your self-interest to go down to a team of 10.

So it's not going to be generally it's not going to be the University Relations Director in a Big Four, who's going to drive that change. It's gonna be her boss, it's going to be the Senior Vice President of Human Resources, who's going to say, "wait a sec, we spent $20 million last year flying people around the campuses. And in the 2020-2021 school year, you hire just as many people with $2 million? Tell me again, why should we be spending $18 million so we can have your team rack up a bunch of frequent flyer miles?" I think that there's going to be a reckoning for most of those big organizations, they make those decisions in March, April, May. I think, you know, that your sister company HireClix and the other ad agencies and whatever I think, I think in a couple of months, you're gonna be hearing a lot about that.

Martin Burns

Truth be told, we've been hearing a bit about that. There are things coming in. It's just against data and numbers. And if I'm a VP of TA, and I see, I've got a fixed budget, and I just regained $18 million, I can put that on technology, I can do things on candidate experience. I can do a lot more all of a sudden. And you're fighting to keep that to yourself, for something else.

Steven Rothberg  

How about, how about investing that money in some really great assessments? So that whether that candidate is white, black, brown, female, male, citizen, green card, community college, Ivy League, whatever, you put them through the assessment, and you see, can you do the work? And if you can do the work, here's a job offer. I mean, wouldn't that be a better way of hiring than flying people around and saying, "oh, Martin, you go to a snazzy school? Well, it would be prestigious for us to hire you, and hopefully you'll be productive." That's just doesn't make sense to me.

Martin Burns

It's it's funny when I first started recruiting .One of my colleagues was talking about hiring kids fresh out of college, she said the issue is it's like a stick of dynamite - it's just potential energy. You don't even have until you light the fuse, the fuse goes, and they see what happens, how big the explosion is. But now with data analytics, you can start understanding "this will make this big of a boom. We think the stick of dynamite can do exactly this." Steven, this has been a good chat. Anything else that I haven't asked that you want to add about what's going on, or anything we haven't covered?

Steven Rothberg

You know, the only other thing that I also see changing a lot in the next few years would be what a lot of the best talent acquisition people have taught me over the last few years. And that is that a real shift by employers to becoming more what they call "school agnostic". They don't really care, for most jobs, they don't really care what school you went to. There definitely are some right you want to go work for one of the big four accounting firms, if you went to Wharton, you're going to have connections, and that's going to help them land business, I get that. But for the vast majority of jobs out there, they just care that you're college-educated, if you're in our niche. So I think that we're going to see a lot more employers hire a lot more people from community colleges, and from state schools. That's going to put downward pressure on higher education pricing. And that's, that's definitely really good.

Martin Burns

As the father of teenagers: please yes.

Steven Rothberg

Absolutely. We recommend to friends and family all the time that your 17/ 18 year old who's trying to pick a school, there is just no way that more than 1 out of 100 of them have any clue as to what they want to be doing when they're even 30. And, you know, spending a quarter of a million dollars on a college education is insane. You know, if you don't know what you want to do, take a gap year, go to work, go travel when COVID isn't a thing anymore. Go to community college, the community college, I think the quality of education, the quality of teaching is almost always far superior to what you get in a traditional four-year school traditional four-year school, half of your classes in your first year, you have up to 500 kids in the classroom, and in a bunch of those, there's a TV up at the front of the room or a grad student teaching. You can't tell me that's quality teaching. And you know, this year with COVID, the whole learning remote thing, it's crazy that people are spending $60,000 a year to learn on Zoom, when they're probably better education available on YouTube. For the same topic. I mean, I get the fact they're basically buying a degree, hoping that that degree will get them a job that will eventually pay for that education. But if they can pay a quarter of what they did for that education: they should. There are a lot of really big Fortune 1000 companies out there that have realized that. And that's really exciting. It's really opening things up, so rather than legislation or warm fuzzies that you should hire this diverse candidate because it's the right thing to do this - and it is, and that's important. But if there's also a really good economic reason for that? That's also good. Employers should also be advocating for this, because if you hire someone who's got a $250,000 debt load, and you're paying them, you know, the typical 40 grand a year for college grad, there's a really, really good chance that you're going to lose that person in a year or two because they can get a $2,000 raise by moving across the street.
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Martin Burns 

Not to mention that debt load is stress. So you've got a very stressed employee who's panicking about money, and they can't they can afford to live a life, meet friend, they're just miserable.

Steven. it's been wonderful. I do want to see in person someday, so hopefully, we'll get through all this and we can talk again. In the meantime everyone thanks for hanging with us. Steven, any closing words?

Steven Rothberg

If anybody has any questions, they like what I had to say, connect with me on LinkedIn, shoot me an email: steven@collegerecruiter.com.