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Measuring Talent Loyalty in Staffing: Turning Workers into Long-Term Value Drivers
18 Plays3 days ago
Everyone talks about employee retention and talent loyalty, but few staffing agencies have a clear, repeatable strategy for making it real. In an industry where fill rates, show rates, and redeployment define success, loyalty isn’t a slogan. It’s a competitive advantage that directly impacts client satisfaction and revenue growth.
On this episode of Avionté Digital Edge, host Christopher Ryan is joined by David Folwell, Founder of Staffing Hub and President of Staffing Referrals. Together, they break down how leading staffing agencies are building talent loyalty in practice, how they are measuring it to drive sales success, and how to turn it into a sustainable, repeatable operating discipline. The conversation also explores how emerging AI technologies are reshaping the way agencies engage, retain, and grow their talent pools to drive long-term value.
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Transcript
Introduction and Importance of Talent Loyalty
00:00:00
Speaker
Everyone pays lip service to employee retention and talent loyalty. It shows up in a lot of mission statements and pitch decks. But if you're a staffing agency, what practical steps can you take to build talent loyalty?
00:00:13
Speaker
On this episode of Aviante Digital Edge, we sit down with David Falwell, the president of Staffing Hub and the CEO of Staffing Referrals to discuss talent loyalty.
00:00:24
Speaker
What it is, how you build it, how you measure it, and how to make it a sustainable and repeatable practice for your agency.
00:00:36
Speaker
Welcome to the Aviante Digital Edge. I'm Chris Ryan. Ask any employer what they want from their staffing agency, and the first thing they talk about is talent. People who show up, perform on the job, stay for the duration, people who might even come back for future assignments.
00:00:53
Speaker
A staffing agency with proven talent is the agency of choice for most employers. But what does it take to create meaningful, repeatable programs to drive talent loyalty?
Understanding Talent Loyalty and Value
00:01:04
Speaker
To help us unpack this issue, I have David Falwell joining me. Now, back in February, David and I explored the concept of lifetime value of talent. Now we have the opportunity to explore one of the biggest drivers of lifetime value, talent loyalty.
00:01:20
Speaker
And while we're at it, we'll also explore how new emerging AI technologies may help staffing agencies to build a more loyal, high quality database of talent. David, welcome.
00:01:31
Speaker
Thanks, Chris. Super excited to be here with you today. So, David, I want to start from the client side of the table. If I'm an employer and I use staffing agencies, I hear talent loyalty and I think, why should I care? These people don't work for me.
00:01:47
Speaker
They're your employees. So make the case. Why does talent loyalty at the agency level matter to the employer who's actually using that talent every day? I want to relate it to the staffing agency first and then talk about from the employer perspective, just real quick. So I know last time we talked about Canva lifetime value, which is one of the more important metrics for gross profit for long-term profitability.
00:02:10
Speaker
And I think if you're an agency, you're listening to this, the stat that I like to bring up, and I think it's always interesting as well, is this whole concept of what is the value of a customer over the lifetime of working with you?
00:02:22
Speaker
Chris, do you know how much Starbucks makes on average per customer? I have to believe it's a very large number for those customers that come back every other day. So let's work this out. If I spend $5 on my Mocha Latte and I do it, say three days a week, 50 weeks a year, i think we're talking about a couple thousand dollars. Is that about right?
00:02:43
Speaker
So the average gross profit earned on one customer at Starbucks, it's over $14,000 on one customer. That is based off of 2,820 visits over 20 years.
00:02:55
Speaker
I think that same ah idea applies to staffing. And staffing firms historically have been thinking about redeploy rates, which is the same concept, which is really, really important for the profitability of your firm, which I know we'll talk about. And we talked about a little bit last time.
00:03:09
Speaker
But when you take that now to the client side, it's like, why does a client care about loyalty?
Leveraging Data for Talent Reliability
00:03:15
Speaker
It comes down to turnover costs. If you're working with a client and you say you have a loyalty program where you're focused on loyalty of your talent, they are going to think, right, you guys are doing something different to make sure I don't have to hire more people from you. And clearly rated cited estimate of $1,500 hourly worker on turnover.
00:03:37
Speaker
But the range is anywhere from 10 to 33% is the cost of replacing somebody. And if you can avoid the retraining, the knowledge transfer gaps, all of that, you are delivering more value to your clients.
00:03:52
Speaker
And you're also showing them that you care about the quality of your workers and that you care about who you're putting on assignment because they're a good fit for them. So if you can actually prove to an employer that you have more reliable talent and you back it up with data, does that change the competitive dynamic when you're trying to win business against three or four other agencies?
00:04:15
Speaker
Absolutely. And we have customers who do that today. And there's a lot of ways to do this, but if you're going talk to a client and the client has access to Indeed and all the job boards, and so do all of your competitors,
00:04:27
Speaker
How are you differentiating what you're delivering if you're just using job boards? The reality is if you can say that my talent works on average 40% longer than the average tenure of my competitors or of these other sources, you are delivering more value to them because they're not going to have to go hire somebody again. They're going to produce the effort and time it takes to keep people on contract. And that shows that there's a lot of things that go behind loyalty, but it is something that is being used today to drive more client sales.
00:05:01
Speaker
We have customers that are using their talent networks specifically in their presentations to customers where they're actually showing here's the number of people in our talent. Here's the duration of time they work. And here's how much higher quality that is compared to what other agencies are delivering.
00:05:18
Speaker
Yeah, so I'm curious. Now I'm imagining I'm a staffing agency and I'm walking into the employer and I say, I've got more loyal, better talent than anyone else.
00:05:28
Speaker
And the employer says, you know what? The guy who came in before you said the same thing. What is the most persuasive data that you can actually bring to the party to show an employer that you are the agency of choice?
00:05:41
Speaker
I was just at the staffing sales summit, Dan Morris conference, which is amazing. And somebody on stage said, everybody says we have the highest quality candidates. and the idea that you're going to walk in and say that and have it be believable, it's easy to say, but if you actually want to prove you have a higher quality candidate, there's a few things you can do that are pretty straightforward and hard to refute. And one of those is track the time on contract.
00:06:09
Speaker
Compare that to other benchmarks that are in the industry. What is your time on contract? What is your redeploy rate? How many times do you get referrals from the people that work with you?
00:06:20
Speaker
These are all elements that verify the quality of the candidate and are symptoms of you focusing on putting the right people in the right place. So bottom line is you can't boast unless you got the numbers to back it up.
00:06:34
Speaker
But if you got the numbers to back it up, nobody's gonna argue with you. Yeah, I think that you have to have the data. What is the size of your network? How many referrals are you driving on an annual basis?
00:06:46
Speaker
And we have customers that get 50% of their placements from referrals. If you can go into a customer and say 50% of our business is coming from a referral,
00:06:58
Speaker
Not only are you showcasing that you are delivering quality, but you're also saying I have access to talent. That's not on the job boards. I have access to talent that isn't just readily available to every single person that's out there looking for them.
00:07:12
Speaker
And so you're delivering a unique value in a few different ways.
Strategies for Building Talent Loyalty
00:07:15
Speaker
So let's make this concrete because talent loyalty sounds great. Redeployment sounds great. Everybody wants it. But what is it that a staffing agency needs to do in order to create a loyal talent base versus other agencies that are just passing candidates through the system? Is this a once and done? Is it somebody at the top making a decision that we're going to retain more talent?
00:07:39
Speaker
What does it actually look like to create talent loyalty at the ground level in an agency? Oh, I think one of the funny things everybody always wants the silver bullet for anything and there just simply isn't. And this is one of those categories that there's a lot of elements that go into driving loyalty.
00:07:54
Speaker
and I'll start by talking about how can you see if you have loyal talent and obviously time on contract redeploy rates. Also, are they referring people to you?
00:08:05
Speaker
Are they becoming brand ambassadors? Are they responsive to your organization? But those are the things that are symptoms of having the loyal talent. But at its core, loyal talent happens from psychological factors. It's do they trust you as an agency?
00:08:21
Speaker
Are you easy to work with? Are you reliable? And then I think if you're doing those things well, then you could start thinking about let's add a rewards program and recognition program on top of it.
00:08:34
Speaker
One mistake that I frequently see agencies do is they're like, Okay, we're ready. We want to build the best referral program. and We want to build the best loyalty program. And they don't have the core element of the psychological safety and trust built in. And so I think you need to stop looking at talent from a transactional lens and really be relational with talent first.
00:08:56
Speaker
And once you've done that, you have a high net promoter score, you have some referrals working, then you start layering and rewards and recognition, and you can give visibility to points and things along those lines as well.
00:09:09
Speaker
So you're almost saying that it's great to have a referral program, but you don't just put it as an appendage to the back of your agency. You have to have a holistic approach. Talent loyalty is something that you intentionally have to build on a day-to-day basis with every interaction you have with talent.
00:09:26
Speaker
whether you're talking about pay or commitments or opportunities that you've delivered or training that you've provided or the relationships, whatever it is that makes people feel safe, warm, loved, trusted, and paid, presumably that's what drives talent loyalty. Is that fair?
00:09:44
Speaker
Completely fair. And one of the things that we now start with is, do you have a good net promoter score? Do you have a good reputation? And if you don't, if your net promoter score is really terrible and you have a bunch of terrible Google reviews,
00:09:57
Speaker
Don't focus on a referral program or a loyalty program. You need to focus on creating good experiences first. People are not going to stay on contract longer with somebody if they don't have the core elements built in and people don't refer to agencies that they don't like. You know, if they don't like working with you, the referral program is not the right place to start.
Referral Programs and Automation
00:10:18
Speaker
So I think one of the things that we talk about a lot of staffing referrals is there's the component of the platform and the program and the rewards and the bonuses. But the referral culture being part of something, whereas we treat people well, we have a good culture, we have all of these elements can be a ah core driver of making sure that the software on top actually drives the value you need.
00:10:39
Speaker
Yeah. So it almost sounds like you're doing leadership consulting at the front end. I mean, if I'm a staffing agency leader and I sit down and I say, hey, I want loyal talent. The first thing you might ask them is why does talent want to work for you versus anyone else?
00:10:54
Speaker
We We've actually had a customer who bought from us, canceled, and then came back a year later and said, we want to figure out what we did wrong. And that's where we built the referral culture consulting component because we were like, okay, well, if we're going to do it again, you need to actually follow up with referrals quickly. You can't let the referrals sit in the inbox for two days. If somebody takes the time to refer somebody, there's a whole bunch of things that go into it. And they are excelling now because they've shifted their internal dialogue around referrals.
00:11:24
Speaker
And that matters a lot for the success of these programs. And it kind of has to start at the top. Got it. So obviously when you're running a staffing agency, you might take, well, referrals, they're not that important. I could do that tomorrow, but you're basically saying it has to be part of the day-to-day urgency in the way you run your staffing agency.
00:11:43
Speaker
I think everybody wants to buy software or plug and play a silver bullets to have it fix everything. And what we say is if you're not getting any referrals today, don't buy our software. Don't buy referral software from anybody. Go figure out if people are willing to refer to you first.
00:11:58
Speaker
Once you have people willing to refer to you and you think you're doing okay. And you're like, all right, well there's some referral momentum. That's when it makes sense to automate and scale these things. So I think that sometimes people think the automation is the solving. Automation is the scaling mechanism. It's the fire on top of what works well, not the starting point a lot of times. Yeah, that's an interesting notion.
00:12:20
Speaker
So leadership drives culture, policy drives culture, and then software drives the scale. Exactly. Pretty nice formula there. So let's talk a little bit about redeployment data, since that's certainly one of the metrics that can be very important to both an employer and a staffing agency.
00:12:39
Speaker
Tell us a little bit about some of the data that you are seeing through your work. And how much more likely is a referred candidate to take on a second assignment? And what does that do to the economics of running an agency desk?
00:12:52
Speaker
So last time, I think I'd shared some data from the previous year, and we'll be releasing this data soon. But we went back and looked at 450,000 candidates across placements.
00:13:03
Speaker
from 24 to 25. And we looked at the average days worked and this is counting redeploys as well. And for healthcare care referred candidates averaged 180 days versus 99 days from a job board. So that's nearly double. Yeah, it's insane. and I will say this is referred versus a major job board.
00:13:23
Speaker
One thing I would let everybody that's listening to this know, over and over and over again, the top two highest retention channels are going to be your referrals and those people that come direct to your website as well.
00:13:35
Speaker
So people that know who you are and are coming back to you because they like you, those are the top two. But for healthcare 180 to 99 days and light industrial, it was 64 days versus 36 days.
00:13:47
Speaker
And for travel nursing specifically, i did pull the redeploy rates. And the average redeploy rate for a travel nurse was 2.4 assignments from a referral compared to 1.45 for a non-referred candidate.
00:14:02
Speaker
And that is a insane difference in terms of what you actually make on the talent and also what your customer thinks about what you're delivering to them. So that almost says that one referral candidate is worth two job board candidates somewhere
Incentives and Program Mechanics
00:14:19
Speaker
in there. And beyond that, you're going to have a much happier employer, presumably because you're going to have less turnover on the job, which is absolutely huge.
00:14:29
Speaker
Less turnover, your recruiters have to do less work. I mean, we've talked about this case study as well, but the WSI is one of my favorites. We looked at their data and in 2024, their placement volume went down 8% and their revenue was up 9%.
00:14:43
Speaker
So they just did less work. More revenue, more gross profit. And that's one of the things that we see flowing through. And we're even having customers start talking about, should we incentivize our recruiters differently based off of the source of talent?
00:14:59
Speaker
Should the recruiter themselves commission be different when they go to a higher profitable channel? Like if they get them from their network or from a referral, that is technically more profitable for you as an organization.
00:15:12
Speaker
So why are you paying the same across whatever channel they use? Yeah. It makes sense to reward the recruiter for the lifetime value of the talent they bring in because it's literally the gross margin under management that they've delivered. And that measures the real result, not, hey, I found 10 bodies, but four of them aren't. Yeah, they're they're all going to be our lowest quality candidates. Okay.
00:15:35
Speaker
Yeah, it makes a lot of sense. So in past discussions, you've said that staffing agencies build talent loyalty that do it really well. They make it a core top-down focus, and it's part of their day-to-day strategy and operation.
00:15:50
Speaker
Talk to me a little about what that looks like in practice. For example, you've mentioned things like loyalty program mechanics, similar to an airline miles concept.
00:16:00
Speaker
Maybe you've seen something interesting with incentive or other things. What are some of the best examples you've come across? Yeah, and I won't name names specifically, but there's a few companies that are doing this really well. There's one that's built their business around it and has branded it and then has it out in the marketplace. And they have a handful of different things that they use to reward talent and different ways They've actually created a loyalty score for every candidate based off of an algorithm that they've built into the ATS. But some of the more simpler ways to think about this is you can get a certain number of points for every referral you submit.
00:16:34
Speaker
Assignment completion can be rewarded. Attendance is something that some customers are rewarding. I don't know anybody doing this yet, but there's a lot of conversation around learning and development. Are you getting the certification? Let's get points around that.
00:16:47
Speaker
And so starting to think about what are the things that drive value for your organization that you need that also help the talent and then building a system around that where you reward points that align perfectly the talent with what your goals are and also with your client's goals. And it's no different than incentive alignment at your organization. You're just taking it from, okay, we're doing internal incentive alignment to we're extending that to our talent so that we are going all the way through to the customer to maximize the value you're delivering.
00:17:21
Speaker
That makes great sense. So if an agency buys into this, they believe talent is a recurring asset and they really put some effort behind that. And loyalty, it's a real strategy. It's not just a talking point.
00:17:33
Speaker
What should they actually be measuring? What are the two or three metrics that you would start with to benchmark your program and to track it over time to make sure that it wasn't just a feel-good program?
00:17:44
Speaker
I'll start with the three metrics. I would start with redeployment rate, referral rate, what percentage of people actually refer to you, and then candidate lifetime value. And you could start with just the total number of days worked or hours worked.
00:17:56
Speaker
But I think a lot of people, like they track the redeployment rate and then they say, how do we get our redeployment rate up? And they're like, well, let's send more emails. And that's going to drive redeployment rates up. And it does. Sending more messages will derive more redeployment rates, but also creating really amazing experiences is going to drive redeployment rates up. So thinking about how do we actually treat this person in a way that's going to make it so that I don't want to switch anywhere else. I want to stay here because of the experience and the level of care I'm receiving can be really impactful as well. Yeah.
00:18:27
Speaker
And presumably you wouldn't send your best talent to your worst employer clients either. Exactly.
AI's Role in Talent Loyalty Programs
00:18:32
Speaker
So let's talk about the elephant in the room, artificial intelligence. Every time i read anything now in SIA or ASA, all anyone wants to talk about is artificial intelligence.
00:18:44
Speaker
And a lot of artificial intelligence has been pointed towards efficiency gains, but it strikes me that AI could really make a difference in how we deliver value to customers.
00:18:55
Speaker
So what I'm wondering about is how could AI be used for talent loyalty programs, either in the measurement, the execution, tracking, validation of loyalty schemes? Give me some examples of where you think AI might have some potential with talent loyalty to drive higher lifetime value of talent.
00:19:16
Speaker
To your point, AI is revolutionizing everything in a very impactful way. How do we source faster? How do we screen faster? do we write messages faster? And everybody's chasing that and everybody should be implementing on that front.
00:19:27
Speaker
Thinking about how can AI help us stop losing candidates? How can AI help us retain candidates is really impactful. And there's ways to think about the experience.
00:19:38
Speaker
How quick are you to respond to concerns that they have? How quickly can they get things answered that can be impactful, that are pretty low hanging fruit that can drive better experiences?
00:19:48
Speaker
We were just talking about using unstructured data. a couple people that we've worked with and have shared customers with their ring over and Toro insights. And we're in conversations thinking about it at what point can you use the unstructured conversational data to identify sentiment where It's a positive sentiment. That's an opportunity to ask for a referral and drive somebody in, but it also could be an opportunity to figure out different ways and opportunities to reward points. I think that the big play here is going to be two things. One, figuring out ways to use data that a human would not have been able to go through previously to identify what loyal talent looks like, to identify the archetype of who we should hire, who's going to stay on contract longer.
00:20:36
Speaker
And then I think the second part, which we're digging into is more of the concept of the talent graphs and looking at who are they connected to? Who in the network do they know? How can we give you signals that would identify that they're a higher quality candidate and able to refer people in into you as well.
00:20:54
Speaker
And those are two of the, i would say not immediate term, bigger plays that are going to have a bigger impact to not immediate term. On a short term, what is live in our platform today is we have an AI outreach.
00:21:07
Speaker
It probably needs a better name for It's called AI outreach at the moment, but it basically does all of the touch bases related to referrals today to ensure that there's consistent, reliable conversational outreach via AI SMS. So it's basically like your referral recruiter that's asking you if you know anybody can update you on where you're at in the referral program. And that is going to tie into loyalty over time as well.
00:21:33
Speaker
To me, the real power of large language models is working with unstructured data. I certainly don't need a large language model to do a Boolean search. I've seen wonderful applications of AI where you're able to take large amounts of unstructured data, identify some real insights,
00:21:50
Speaker
and essentially create a plan for how you're going to drive higher talent and loyalty, it does make a lot of sense how you could deploy AI and actually maximize value. Because I'm not sure employers always want speed first.
00:22:04
Speaker
Don't get me wrong, speed is always important in this business, but first with excellent talent is even better. And that to me is where the industry is going. It's got to be around the quality of the talent delivered on an ongoing basis.
00:22:18
Speaker
That's really what's going to make or break companies over the next five to seven years. It is, i think it's going to be everything. i think we're moving towards a world where the job boards are going to offer free AI sourcing and screening capabilities, access to resumes. It's going to be easy to find talent.
00:22:36
Speaker
The hard part is going to be, are they verified? Are they trusted? are they in network? Is a reputation good? And how do you know that they're actually high quality? And that's where the proprietary networks come in. I think that's what the future of modern staffing agencies are going to like. I think it's why companies like Refusher are doing so well in the space. I think it's why a lot of the forward-looking agencies are talking with us about how do we start moving towards where things are going. I think that's going to be really impactful.
00:23:03
Speaker
Also on that the AI front, it used to be needed to have the really structured prompt engineering. And this guy, Nate Jones, is unbelievably forward-thinking where AI is going. And I've already seen this firsthand, but It used to be how can you ask AI the exact right question you need to ask? And how do you prompt to engineer this the perfect way?
00:23:22
Speaker
and the thing that is changing and the way I like think about like, AI is becoming the smartest person ever in the entire world. And if you're sitting next to the smartest person you've ever met, would you think about telling them exactly how to do their job? Or would you say, how would you solve this problem?
00:23:38
Speaker
And I think we're moving towards a world with AI where you could do what you just said, which is say, I'm trying to figure out how to drive loyalty. Here's the data in my database. How would you create a program to drive more loyalty or what data would you look at to figure this out? And I think we're moving in a world where AI is becoming much more capable of solving these problems with much less guidance. And sometimes it can be pretty impactful as well.
00:24:04
Speaker
Yeah. and And David, I have to say, I can't agree with you strongly enough about this. I see so much use of time and energy with AI just focused on let's have ah an artificial business development rep or let's try and improve efficiency in some way.
00:24:20
Speaker
When the delivery of value ultimately, I think is where AI is really going to have the huge contribution to the industry.
Looking Ahead and Closing Remarks
00:24:27
Speaker
So in our next episode, we're going to talk a little bit about how do you turn talent loyalty into a sales weapon?
00:24:34
Speaker
And I know you've been building some really interesting ways to visualize talent networks as a competitive asset and ways that you could actually use that to change how you walk into a client meeting or a prospect meeting and actually close the deal.
00:24:49
Speaker
So David, this has been really enlightening. Thanks so much and look forward to talking to you again soon. Always love being on the show. Enjoy our conversations. And thanks so much.
00:25:00
Speaker
This has been another episode of Aviante Digital Edge. Thank you to our listeners for joining us. If you enjoyed this episode, please like and subscribe on all major podcasting platforms.
00:25:11
Speaker
And if you'd like to learn more about Aviante and how our all-in-one staffing platform can help your business grow, visit aviante.com. I'm Chris Ryan. Until next time.