Why It's Important: With financial industry layoffs reportedly topping 150,000 in the fourth quarter of 2008, career management is the buzzword on Wall Street. Referrals continue to be key in recruitment. But companies looking to extend searches beyond referrals are increasingly tapping social networking sites to fill positions. "Sites like LinkedIn have made it much easier for hiring managers to see who you are, even if you're not actively looking for a job," says Shawn Banerji, managing director in the global technology practice at New York-based recruiting firm Russell Reynolds Associates. "It is particularly useful if you're looking for a technology expert, as you will see senior IT execs signed up and actively using it." Social networking also enables passive candidates to catch the eye of recruiters, as well as to keep abreast of developments in their fields by sharing expertise with their peers.
Where the Industry Is Now: Professional networking site LinkedIn reports that its rate of new membership doubled between August 2008 and November 2008. During that time, the site added a new user every second. MeettheBoss.com, an exclusive networking site for top-level financial executives, launched in September with 20,000 invited members. On the day Lehman Brothers went under, the site recorded a 60 percent increase in traffic.
While recruiters still use job boards such as Monster.com, they prefer sites where they can target people from specific professional groups. Recruiters often google potential candidates and search for them on LinkedIn before initiating contact.
Some recruiters use social networking sites together with other applications, such as Jobvite, an on-demand recruitment application that enables an entire firm to participate in the hiring process. The application allows the company to notify employees when there is an open position. Employees can then share job invitations with their professional and social networks. Recruiters can further research candidates by looking up their profiles on LinkedIn, says Mike Jacobson, director of HR at Advent Software. "We're always exploring how technology can enhance ways of finding people," he adds.
Employees also use professional social networking sites to keep contacts up-to-date, particularly important if you quickly need to open your virtual rolodex to look for a new job. One such site is Plaxo, an online address book and social networking service. When contact information is edited by a user, the changes appear in the address books of all those who listed the account changer in their own books.
Focus in 2009: With pink slips expected to keep flying in 2009, job seekers will increasingly tap into social networking sites. The biggest areas of growth will be around highly targeted sites and vertical communities. MeettheBoss -- which promotes peer-to-peer networking with secure video calling, instant messaging, e-mail and SMS between executive members -- currently receives 300-plus applicants a day, although 66 percent are turned down in a bid to keep the site exclusive. MeettheBoss user Gautam Bose, an SVP with Wachovia, found the site particularly useful during the uncertain days this fall when his company was in talks to be acquired by Citibank and Wells Fargo. "People have been playing Ping-Pong with our organization, and it was good to have a place to discuss what was going on," he told the International Herald Tribune.
Industry Leaders: Robert Half International, Russell Reynolds Associates, Russell Stephens, Michael Page International and many other recruiters leverage social networking sites.
Technology Providers: LinkedIn, MeettheBoss, Plaxo and other targeted social networking Web sites.
Price Tag: Most social networking sites, including LinkedIn and MeettheBoss, are free to join. Some also offer premium paid services for business users and recruiters that can range from $20 per month to several hundred dollars.