Before selecting a recruitment method, organizations should identify whether their ideal candidates are passive (currently employed and content) or active (seeking new opportunities). Most employers prefer to target passive job seekers, but traditional recruiting methods such as online job postings primarily attract active job seekers.
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Rising to a new level of importance, talent acquisition is a vital role for HR professionals. The right talent is essential for an organization to meet its business goals and succeed in a rapidly changing and competitive marketplace. Yet, more than 70% of organizations are experiencing recruiting challenges, according to SHRM’s 2025 Talent Trends report. Since 2016, the same types of positions have been difficult to fill, reinforcing a need for new approaches.
The exponential rise of artificial intelligence has significantly disrupted the recruiting landscape, creating even greater challenges for 2026. AI is transforming various recruitment workflows, and its use will continue to become more prevalent, both for employees and recruiters.
The HR professional has emerged into a new role as a strategic talent advisor to meet these challenges. Learn more about recruiting as a strategic imperative and proven talent acquisition approaches for internal and external recruiting efforts in this toolkit. Relevant federal and state laws and methods to demonstrate the business impact of recruiting efforts are also included.
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Meeting Market Challenges
Recruiters face three major categories of challenges: supply and demand, not having the right skill sets, and inadequate compensation packages. according SHRM's 2025 talent trends research. The greatest challenge for recruiters is supply and demand, which reflects increased competition and a rise in candidate “ghosting,” when applicants suddenly end all communication without an explanation.
A Skills Mismatch
Skills-related challenges indicate an occupational mismatch in the labor market. More than a quarter of unemployed people could not be matched to a job opening in their occupational group, according to recent SHRM research on the labor shortage, and 61% of recruiting professionals have a lack of qualified candidates for open roles. Rampant reductions in the federal workforce are also having a ripple effect on talent availability and hiring trends.
An AI-Driven Opportunity
As AI increasingly takes over high-volume, repetitive tasks in talent acquisition, HR is poised to demonstrate its value in terms of human insight and influence, particularly in meeting current market challenges. With traditional job posting and resume-screening methods becoming insufficient, HR must shift to designing adaptable, data-informed recruiting strategies that support future business growth by marketing the organization more effectively. This includes:
- Creating a compelling employer brand.
- Hghlighting organizational culture and career growth paths.
- Rethinking total rewards.
Top HR leaders are:
- Building talent pipelines that align with business strategy.
- Using workforce analytics to forecast hiring needs before they become urgent.
- Ensuring hiring forecasts match the organization’s growth forecasts.
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Pro Tip
Even during periods when overall labor market conditions appear favorable, certain occupational groups consistently face shortages while others have surplus labor. This suggests successful talent acquisition requires sector-specific approaches, rather than one-size-fits-all solutions.
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Recruiting as a Strategic Imperative
Every business needs to view recruiting as a strategic business function to stay competitive — whether to fill a vacancy, staff a new position, or plan for the succession of management. Economic conditions, site expansions, mergers, and competitive activity all affect hiring decisions. As job hopping declines in a cooling labor market, HR leaders will increasingly need to promote the long-term value of internal growth opportunities, skill-building initiatives, and internal mobility programs over higher starting salaries.
Employers will need to carefully weigh how they recruit internally and externally. If a position is not created or refilled, the employer may experience financial losses, and HR professionals must be prepared to communicate this impact. Three steps SHRM researchers recommend to bolster the internal recruitment pipeline include:
- Create a culture of talent mobility.
- Redesign job postings to prioritize internal candidates.
- Leverage data to identify hidden talent.
Internal Versus External
Internal recruiting offers many other advantages, too:
- Lower costs with minimal recruiting fees, reduced training, and no relocation expenses.
- A faster process that is often completed within weeks.
- Managerial support with a good sense of employees’ strengths and access to past performance records.
- A stronger cultural fit through existing relationships and company knowledge that can make it more likely for the employee to succeed.
- A boost to employee morale by demonstrating career growth opportunities within.
Some employers may turn to external recruitment only if internal efforts are unsuccessful, but recruiting outside the organization also has several advantages:
- New skill sets that can expand organizational capabilities.
- A fresh perspective that can help grow the business or take it in a different direction.
- Greater talent alignment with the needs of the position, as opposed to the strengths of internal candidates.
- Opportunities to diversify the organization’s talent pool.
Ultimately, developing the right mix of internal and external recruiting depends on the needs and resources of the business. However, even for larger organizations, most positions by far are still filled externally.
Pro Tip
Organizations that treat internal talent as a strategic advantage are better equipped to adapt to market disruptions, retain top performers, and outpace competitors.
HR as a Strategic Talent Advisor
HR must not only lead the recruiting process but also act as a business partner with a strategic talent acquisition approach. That approach encompasses developing talent, engaging stakeholders, managing recruiting initiatives, tracking metrics, and ensuring compliance.
Strategic talent advisors build relationships that connect stakeholders in the recruitment process — candidates, hiring managers, and the C-suite — while diving deeper into the strategy of workforce planning to guide smarter hiring decisions. Steps to delivering strategic value include:
- Saying “no” without saying “no.” For example, estimating costs to justify a less expensive recruiting approach.
- Building in time for strategic work. This might include taking the time to fully learn the organization’s business strategy.
- Providing more than customer service. Advisors operate like consultants who offer solutions instead of simply accepting a lack of candidates.
- Conducting effective intake meetings. Developing a recruiting strategy with hiring managers as opposed to simply filling a position adds greater value.
Additional strategies to improve recruiting results might include overhauling the careers website or the candidate experience.
Conducting Effective Hiring Manager Meetings
Three things recruiters can do to help hiring managers are 1) speed up the process, 2) know the business, and 3) bring insights and expertise.
HR can execute on all three and help improve hiring outcomes by collaborating with hiring managers to design a recruitment strategy plan for each position. When hosting an initial meeting with a hiring manager on a recruiting strategy plan, set an agenda that includes:
- Gathering information about the skills needed for the role.
- Identifying must-haves and nice-to-haves.
- Streamlining qualifications.
- Discussing which business goals this position will support.
- Clarifying responsibilities.
- Setting action items for HR and the hiring manager.
Follow up by communicating to the hiring manager an outline of the recruitment strategy and action items to align expectations. These five simple tips can also make meetings with hiring managers more effective.
Recruiting Nontraditional Candidates to Expand the Talent Pool
Recruiting previously overlooked talent such as people with criminal histories, veterans and military spouses, people without college degrees, and older workers has become a business imperative together with skills-first hiring. For example, workers ages 65 and older are the fastest growing segment of the U.S. workforce.
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SHRM Resources
- Quiz: Is Your Recruiting Strategy Future-Ready?
- How to Hire Candidates from Underemployed Groups
- Skills-First Hiring Toolkit
- Research: Redefining Talent with the 65-and-Over Workforce
- Data Brief: Older People in the U.S. Labor Force
- Labor Snapshot: Women in the U.S. Labor Force
- Research: Insights for Retaining Deskless Workers
Have a question about HR function strategy for recruitment?
Pro Tip
Significant pay increases, remote work options, or entirely new benefits programs may not always be feasible, but organizations that cannot match the highest market rates can still stay competitive by adopting alternative strategies.
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Legal Issues
AI-powered recruitment tools are transforming hiring processes, but they have faced scrutiny for perpetuating biases present in historical data, leading to a projected rise in AI bias audits. Using agentic AI, or AI agents, to make complex hiring decisions carries an especially high risk.
A variety of federal laws prohibit employment discrimination on the basis of:
- Age.
- Citizenship.
- Race and color.
- Disability.
- Genetic information.
- Family and medical leave use.
- Military service.
- National origin.
- Pregnancy.
- Religion.
- Sex (including gender identity and sexual orientation).
It is also against the law for employers to agree to fix wages or to not hire one another's workers. Those agreements — whether entered into directly or through a third party such as a trade association — are illegal under antitrust laws, and violations could lead to criminal prosecution against workers and employers.
State Laws
Many states and other locales have similar anti-discrimination laws that cover smaller employers, in addition to laws related to AI, as is the case with California, Colorado, and New York City. State laws can also prohibit discrimination on additional bases, such as personal appearance or marital status. SHRM’s Multistate Laws Comparison Tool is a helpful resource.
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Internal Recruiting Approaches
More organizations are using an internal talent marketplace, which saw a 10% increase in SHRM’s 2025 Talent Trends report. This may reflect a growing recognition that the best source of talent can often be found within the current workforce.
These centralized, technology‐enabled platforms or systems match employees’ skills, interests, and career aspirations with available projects, roles, gigs, and development opportunities. However, they require a high level of governance and must be strategically executed. Organizations that find implementing a full-scale internal talent marketplace unfeasible can still harness its principles to drive strategic talent management by adopting foundational elements, such as establishing a transparent skills taxonomy or creating informal talent-sharing programs within departments or functions.
Additional approaches include:
Nominations. Managers may recommend high-performing employees for internal roles, often through an informal process. While this method is effective in smaller organizations where employees’ work is well-known, it can risk perceptions of favoritism or discrimination, potentially outweighing its benefits.
Knowledge, skills, and abilities (KSAs) database. New hires can create a KSA profile that details their background, experiences, and career goals — updated periodically — which HR can then use to identify individuals for any position openings.
Succession planning. Organizations can use succession planning strategies to identify potential talent in the organization and establish development plans to help prepare individuals for promotions.
SHRM Resources
- What are the benefits of posting jobs internally?
- Job Requisition Preparation and Approval Process Policy
- Job Requisition Form
- Hiring Policy and Procedures
- Checklist: Streamline Your Hiring Process
- Employment/Job Application (Internal)
- Master AI Prompts for Writing Effective Job Postings
- Employee Referral Program Procedures
External Recruiting Strategies
Recruiting external talent can be most effective when organizations apply marketing principles — identifying target candidates and tailoring messages — to promote their organization and their job opportunities.
Partnerships can include third-party recruiters (headhunters), temporary staffing firms, educational and vocational institutions, counselors, teachers and professors, government or community-based programs, and internal or external public relations or marketing professionals.
An organization’s reputation as an employer directly impacts its ability to attract top talent. Positive word of mouth from satisfied employees, whether through referrals or casual conversations, can amplify recruitment efforts, while negative feedback can hinder them.
Employers can strengthen their employment brand by crafting clear, engaging recruitment messages (e.g., "We're Hiring" instead of "Help Wanted") and actively participating in community initiatives, such as sponsoring events or encouraging employee volunteerism. Pursuing local HR awards can further position the organization as an "Employer of Choice" and enhance its image.
The employer brand is shaped by how candidates are treated throughout the hiring process, from the application to interviews and final decisions, regardless of whether they are hired. Employers must develop policies and practices that set guidelines for these elements to create a winning candidate experience. Questions to ask include:
- Resume and application submission. Is this an easy process that doesn't require providing too much data? Can candidates easily navigate an employer's online or offline application process, including via mobile devices? Can candidates easily find the careers page on the employer's main website — in one or two clicks?
- Candidate communication. Are candidates provided timely and authentic communication on whether their application has been accepted, the status of interviews, and answers to questions they may have about where they are in the process?
- Interviewer interactions. Are candidates interviewed by HR and hiring managers who are prepared for the interviews, have reviewed the resume or application in advance, are respectful of candidate responses and questions, and show consideration for the candidate's time?
- Candidate logistics. Are candidates provided clear instructions regarding the logistics for their visits to a worksite, including a schedule of interviews and interviewers in advance, information on how to drive or travel to the worksite, reimbursement procedures for expenses, and details related to appropriate meal or restroom breaks?
A consistent, respectful, and streamlined candidate experience not only strengthens an employer’s brand but also influences how candidates share their impressions externally on employer review websites such as Glassdoor.
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Pro Tip
Improve your employer brand and value proposition to make sure candidates understand what they’re getting at your organization beyond a paycheck. On your careers site and in other recruiting efforts, highlight company culture, work/life balance, and opportunities for professional and personal growth.
SHRM Resources
- The Role of AI in Modern Recruitment Strategies
- Employment/Job Application No. 1
- Employment/Job Application No. 2
- College Recruitment Letter
- Job Ad Template
- Checklist: Career Fair Recruiting
- Resume/Application Review Form
- Applicant Rejection Letter — Unsolicited Resume
- Resume Rejection Letter — No Interview
- How to Target Passive Job Seekers
Pro Tip
Social media policies and procedures are essential to protect the employer's brand. You also need to have an understanding of a myriad of online advertising options such as video streaming.
Metrics That Matter
Talent acquisition metrics applied effectively can maximize resources, elevate the quality of new hires, and enhance the overall hiring strategy. Business leaders will be most concerned with whether the strategy is delivering on the organization’s business goals over individual metrics. Recruiting dashboards can be used to turn hiring data into useful talent intelligence accessible to those without a data analysis background.
The top five metrics that drive business impact are:
- Time-to-hire or time-to-fill. The number of days it takes to hire a candidate, starting from the time the vacancy is posted. In 2025, SHRM's recruiting executives benchmarking research calculated the average time-to-fill to be approximately six weeks.
- Source of hire. The referral source (e.g., an employee, recruitment advertisement, or event) can help measure the effectiveness of different recruiting channels.
- Quality of hire. This is generally an indicator of an employee’s first-year performance (and whether they remain on the job); however, defining it in practice can be highly challenging.
- Recruitment funnel effectiveness. Conversion metrics, such as how many candidates get to the interview stage, or a drop-off rate, can illustrate how well the strategy is working.
- Recruiter performance metrics. The right metrics account for the type of recruiting being done and additional roles the recruiter may play. It may even be team-based.
Employers may also want to consider the percentages of positions that were filled by internal versus external candidates. Additional metrics to track recruitment include:
Vacancy rates. The number of open positions as a ratio of all positions.
Turnover rates. The number of employees who have been terminated or left as a ratio of the total number of positions in the organization.
Cost of turnover. All of the costs associated with replacing an employee (e.g., recruitment costs, selection costs, and training costs).
Selection ratios. The number of candidates within a selected group as a percentage of the total number recruited.
Cost-per-hire. The cost of filling one position, which may include agency and advertising fees, travel costs, and recruiter pay and benefits.
Pro Tip
Many organizations already collect significant data during the performance review process, such as performance evaluations, retention rates, talent scorecards, and 360-degree feedback scores. The key is for HR to ensure they are connecting this data to recruiting metrics such as quality of hire.
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