Welcome to the first blog in our series. Over the coming weeks, we will talk about the resume/employment verification industry as a whole, provide an analysis and discuss about the difficulties everyone in the ecosystem faces. We will showcase how upcoming technologies can solve multiple issues the industry faces and how we can make lives better by reducing manual work while instilling trust across the ecosystem.
On to some facts
The candidate verification industry is a multi-billion dollar industry worldwide and is only set to grow over the coming years. Research has repeatedly shown serious concerns as well as insights which show why the industry is expected to grow. According to a study done in 2015 by HireRight, an employment screening service provider, 23% of over 218,000 screenings it conducted in India between January 2014 and April 2015, contained a lie or discrepancy, i.e, 2 out of 10 resumes screened for verification contained discrepancies, with more than a half of them relating to education. Also, Employment Screening Services market is expected to grow to US$ 5.46 billion by 2025 from US$ 3.74 billion in 2016. The Global Employment Screening Services Market accounted for $2.9 billion in 2016 and is expected to reach $4.9 billion by 2023, registering a CAGR of 7.5% from 2017 to 2023. Asia-Pacific region alone will exhibit the highest CAGR of 9.1% during 2017–2023.
Deep dive into the process of verification
At SpringRole, we decided to dig deep into why the industry is thriving and the answers to that question shocked us. For a moment let us assume that as human beings we have a natural tendency of lying and reporting false facts, especially if the need is to make a livelihood or to get a job. Although there are many third party verification partners, a considerable number of people get through with their falsely declared facts and achievements. We found out that the devil lies in the process in which the verification agencies perform verification checks. Let us look at the general procedure which is an industry standard for verification.
If you have ever been a manger or a founder or a member of an HR department, this form might look familiar:
This is a final slip received by the employer from their verification vendor, either as an email or a hard copy. Let’s look at why whatever happens after this step may be completely inaccurate.
- The candidate can influence the person entering details on this slip
- What if the company shut down, there may never be a reply
- The company or the manager holds a grudge against the candidate and may deliberately enter false information
- The concerned person might choose to ignore and not respond at all
In all these cases, the response sent to the client by the verification agency might not be a favorable one.
To understand how we got here, we have to look at what goes on behind the scenes, at the verification agency and the process they follow to verify data and candidates.
Here’s a general look at the process:
The biggest flaw in the system is the use of a middleman. A third party human intervention to validating data can seriously hamper the results of the entire process.
Some of the obvious problems
- Paper record or a centralized record: Most often the client file is stored as a paper record or as a record in a centralized database. This leads to easy access of data to anyone and is a security risk. Chances of loss of records or easy manipulation are plenty.
- Number of people working on a single client case: More often than not, at least 3 people work on a single case. The costs involved in having 3 people employed needn’t be discussed at all… it is quite an expense. Apart from this, costs incurred by an agency or a client for the entire process is a minimum of $300.
- The importance of a single person being the validating authority: This is probably the biggest drawback in relying on offline verification agencies or partners. Giving one person maximum control over validating the collated data puts authenticity at risk. There is a huge risk of data fabrication. Moreover, offline verification and validation take a lot of time.
The power of blockchain: A foolproof solution of the future
Blockchains are completely tamper-proof. This means that any data entered on the blockchain cannot be altered or removed, even by the person who put it there in the first place. Hence, any data that is attested on the blockchain can be trusted to be 100% accurate. This will aid in weeding out fake job profiles, or even negate the possibility of them existing.
If digital certificates attesting educational qualification, employment, skill proficiency, or any critical information are issued or stored on the blockchain, companies need to spend just a fraction of the amount they normally spend on verification– this previously tedious process is now reduced to simply opening an app or website and checking to see if the data is verified. This is game changing — it has the potential to completely disrupt the hiring industry and save millions of dollars and thousands of man-hours for companies every year.
Even though we know that blockchain technology is going to revolutionize almost every aspect of our online lives, it is only with ideation and implementation that we see how it applied to a wide variety of use cases. Employment verification is one such industry where we can see the direct applications of this and the right creative mindset and the right support, companies leveraging this technology have the ability to change the world as we know it.