Learn, What is the Internal Sources of Recruitment? Explaining!

Internal sources of recruitment seek applicants for positions from within the company. In deciding requirement of employees, initial consideration should give to a company’s current employees. Which is concerned with internal recruitment. They include those who are already available on the payroll of the company. This is the important source of recruitment as it provides opportunities for better development and utilization of existing human resources in the organization. Also learn, the Principles of Learning in Training, What is the Internal Sources of Recruitment?

The various internal sources of recruitment include:

Promotions and Transfers!

Promotion is an effective means using job posting and personnel records. Job posting requires notifying vacant positions by posting notices. Circulating publications or announcing at staff meetings and inviting employees to apply. Personnel records help discover employees who are doing jobs below their educational qualifications or skill levels. Promotions have many advantages like it is good public relations, builds morale, encourages competent individuals who are ambitious, improves the probability of good selection. Since information on the individual’s performance is readily available, is cheaper than going outside to recruit. Those chosen internally are familiar with the organization thus reducing the orientation time and energy and also acts as a training device for developing middle-level and top-level managers.

However, promotions restrict the field of selection preventing fresh blood & ideas from entering the organization. It also leads to inbreeding in the organization. Transfers are also important in providing employees with a broad-based view of the organization, necessary for future promotions.

Employee Referrals!

Employees can develop good prospects for their families and friends by acquainting them with the advantages of a job with the company, furnishing them with the introduction and encouraging them to apply. This is a very effective means as many qualified people can reach a very low cost to the company. The other advantages are that the employees would bring only those referrals that they feel would be able to fit in the organization based on their own experience. The organization can be assured of the reliability and the character of the referrals. In this way, the organization can also fulfill social obligations and create goodwill.

Former Employees!

These include retired employees who are willing to work on a part-time basis, individuals who left work and are willing to come back for higher compensations. Even retrenched employees are taken up once again. The advantage here is that the people are already known to the organization and there is no need to find out their past performance and character. Also, there is no need for an orientation programme for them, since they are familiar with the organization.

Dependents of deceased employees!

Usually, banks follow this policy. If an employee dies, his / her spouse or son or daughter is recruited in their place. This is usually an effective way to fulfill the social obligation and create goodwill.


When management faces a problem, which can solve only by a manager who has proceeded on long leave, it may decide to recall that persons after the problem are solving, his leave may extend.


At times, management may not find suitable candidates in place of the one who had retired, after meritorious service. Under the circumstances, management may decide to call retired managers with the new extension. Also learn,The Theory of Human Relationship Management!

Internal Notification (Advertisement)!

Sometimes, management issues an internal notification for the benefit of existing employees. Most employees know from their own experience about the requirement of the job and what sort of person the company is looking for. Often employees have friends or acquaintances who meet these requirements. Suitable persons are appointed at the vacant posts.

Previous Applicants!

This is considered as an internal source in the sense that applications from the potential candidates are already lying with an organization. Sometimes the organization contacts through mail or messengers these applicants to fill up the vacancies particularly for unskilled or semiskilled jobs.

Advantages and Disadvantages of Internal Sources of Recruitment

The advantages of the internal sources of recruitment include the following:

  • Familiarity with own employees: The organization has more knowledge and familiarity with the strengths and weaknesses of its own employees than of strange to unknown outsiders.
  • Better use of the talents: The policy of internal recruitment also provides an opportunity to the organization to make a better use of talents internally available and to develop them further and further.
  • Economical recruitment: In case of internal recruitment, the organization does not need to spend much money, time and effort to locate and attract the potential candidates. Thus, internal recruitment proves to be economical, or say, inexpensive.
  • Improves morale: This method makes employees sure that they would prefer over the outsiders as and when they filled up in the organization vacancies.
  • A motivator: The promotion through internal recruitment serves as a source of motivation for the employees to improve their carrier and income. The employees feel that organization feel that organization is a place where they can build up their life-long career. Besides, internal recruitment also serves as a means of attracting and retaining employees in the organization.

The main drawbacks associated with the internal sources of recruitment is as follows:

  • Limited choice: Internal recruitment limits its choice to the talents available within the organization. Thus, it denies the tapping of talents available in the vast labor market outside the organization. Moreover, internal recruitment serves as a means for “inbreeding”, which is never healthy for the future organizations.
  • Discourage competition: In this system, the internal candidates are protecting from the competition by not giving. The opportunity to otherwise competent candidates from outside the organization. This, in turn, develops a tendency among the employees to take the promotion without showing extra performance.
  • Stagnation of skills: With the feeling that internal candidates will surely get promoting. Their skill, in the long run, may become stagnant or obsolete. If so, productivity and sufficiency of the organization, in turn, decreases.
  • Creates conflicts: Conflicts and controversies surface among the internal candidates, whether or not they deserve the promotion.
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