Blockchain Times, "Employment Recruitment and Job Search on the Blockchain"
Written by Paul Keenan
From a casual observer of business markets, #myjobmatters’ 2017 acquisition of Job.com and two other US-based companies might have seemed like an opportunity to see new faces doing the same thing. The company was still going to be at the mercy of the middlemen recruiting companies who charged clients 20 percent of a new employees’ salary, and the results and time spent on the process probably wouldn’t change too much either. If they haven’t heard the news, such an observer might still be under that impression. If they have heard the news, however, they would see there’s hope that some of the problems of the space can be remedied, as Job.com prepares to apply blockchain technology to its processes.
Some Existing Problems
Like so many situations of business, the problems can be found in the realms of time and money. In this case, the problem is more money than time.
The money problem is that middlemen costs of the recruiting agencies currently have a 20 percent standing fee. That means that, on top of the $100,000 salary that a company agrees to pay a new hire, they have to pay the recruiting agency another $20,000. These fees currently cost U.S. companies $150 billion per year, and the total increases to $638 billion per year globally.
The time problem comes through the entire job search process, from platform to recruiting agent to the client company to the applicant. You add to that all of the relevant data a company might want to gather on specific applicants, and there are a lot of opportunities for slowdowns.
Using blockchain technology will allow Job.com to cut that 20 percent price tag to six percent, only one percent of which the company will keep for itself; the rest will go to the applicant, to be paid after the completion of a 90-day probationary phase. Job.com will charge the client company six percent of the applicant’s first year salary, and when the hired applicant completes the probationary phase, Job.com will pay 83 percent of that money to him or her as a signing bonus. The U.S. average signing bonus promises to be in the $2,600 range.
Using the distributed ledger to allow employers to create curated shortlists of relevant clients, Job.com will cut out a lot of the sluggishness of just one more industry with too many moving parts. Adding the use of smart contracts to negotiate benefits packages, hiring execution will speed up notably.
A Previously Established Company…
Job.com not being a new company, the application of blockchain technology won’t hit the ground running with only itself as merit. This is a well-established company, which will be applying the technology to a previously established foundation. Job.com boasts 60 million candidate registrations in its database and receives 75,000 new candidate registrations each month. With more than 9,000,000 résumés in the database, the site brings together over 150 niche and regionally-focused career sites and offers thousands of area employers to local candidates.
The company currently has offices in London, New York, Boston, Washington, Monaco, and Singapore.
Even prior to the adoption of blockchain, the company provides value-based recruitment packages to allow companies of all sizes to post jobs and search for candidates at a fraction of the cost of its competitors.
…with an Established Financial Base
Well-established companies have well-established funding, and that is no less true for this one. Job.com works with 300 shareholders, and the company hopes to raise between $30 million and $50 million with an ICO this spring.
The Job Token launches April 19, and it will serve as funding to implement the company’s decentralized platform. Tokens will be given to investors, and the probation period bonus that applicants receive will be paid in Job Tokens. The new hire will be given the opportunity to sell the tokens back to Job.com for fiat currency or keep the tokens for themselves. Client companies will pay for their services in fiat currency.
The Future of Job Searches
Job.com is the only such platform presently in the blockchain space, which is a nice position to be sitting in.
The company hopes to convert 1.6 percent of the U.S. user base. This would be a million people, which constitutes a gross margin $500 million and a gross revenue of $3.12 billion. They plan to achieve these totals by dealing with the biggest brands in the world. They forecast heavy involvement from the technology sector because of interest in and understanding of technology and blockchain.
Just weeks away from the international rollout, the company will rely heavily on channel partnerships, such as the one it shares with Company.com, which has 275,000 B2B clients in the United States, all of which have a hiring requirement. The plan is to do a national rollout with those companies.
Job.com sees the industry shrinking. With the larger firms taking a larger share of industry volume, smaller firms will cease to be, or they will be forced into consolidation. Currently, there are 17,000 such firms in the United States, 18,500 in the U.K., and 36,500 in Brazil, which allows plenty of room for scaling back. All of those have traditional recruiting solutions and won’t be able to compete against rival businesses, which are utilizing blockchain technology to cut costs and make the systems more fluid and transparent.
CEO Arran Stewart points out that “there’s only one Facebook, only one Google; when attempting to compete with the distributed ledger, the recruitment industry will shrink, and the large players will have the market share.”
When job growth and the unemployment rate are such telling benchmarks of how well the country is doing financially, it can only help to have systems that make hiring employees and attaining work easier. Blockchain technology is poised to be integral in those processes, and Job.com promises to lead the way in that application.