Economics and Business doi: 10.1515/eb-2015-0009 ______________________________________________________________________________________________ 2015 / 27 Employer Brand Role in HR Recruitment and Selection Olga Starieca, University of Latvia Abstract - This paper's research focuses on employer brand (EB) development as a solution for public sector organizations to attract the young specialists of Latvia. The author uses monographic research method, selection, comparison, induction and statistical data interpretation to explore the situation and potential outcomes of the proposed approach to Human Resource Recruitment and Selection. The research results show that public organizations in Latvia still need to improve their positioning on labour market and work harder on their EB. Keywords - Employer brand, Human Resources recruitment and selection. I. INTRODUCTION There are a lot of risks concerning the employment of new, especially young specialists, in public organizations. Latvian young specialists admit that public organizations usually provide stable but not dynamic work (Starieca, 2014). Generation Y specialists prefer to find both comfortable and interesting work. Young urban specialists with higher education rather work, because they want to, not because they have to. (Matthewman, 2011) Therefore, young specialists that could work for public sector organizations usually are more attracted by private organizations with needs and values adaptive to the modern society. It is possible to solve this issue, and it needs to be solved bearing in mind demographic issues in Europe. One of these issues is unemployment in European countries. It is still high. In August 2014 seasonally adjusted unemployment rates in 28 European Union (EU) countries was 10.1% (Eurostat, 2014a). Another issue is ageing European society. \"The share of the population aged 65 years and over is increasing in every EU Member State\" (Eurostat, 2014), for the period from 2002 till 2012 the increase was 1.9% in 28 EU countries. In the Baltic States this increase was between 2% and 4%. The share of population under 15 years in 28 EU countries has decreased by 1.2% for the same period. (Eurostat, 2014) This causes a lot of other issues connected to the employability, taxation policy, etc. Also young educated labour force emigration is an issue. Those, who are not attracted by the work supply on local labour market tend to find the most suitable for them place of employment abroad, especially, if they are young, ambitious and single (Fratesi, 2014). In many cases the destination of these job seekers are private organizations. In a situation, where public organizations are forced to compete for specialists with private organizations, one of the possible solutions could be working towards the improvement of Employer Brand (EB) of public organizations. Employer Branding (EB) as a tool of attraction of job applicants has a tight connection to Human Resources recruitment and selection (HRRS) activities. A human resources department is dealing with the new employees' recruitment and selection, as well as executives of an organization (Dessler, 2010). All employees of the organization are creating and developing EB. Besides, some studies have already proved that EB constraints applicants' job seeking behaviour (Gomes & Neves, 2010). Therefore, the investment in EB is an example of strategic HR planning. EB involves work with organization culture, relationship development between the organization and its stakeholders and such activities as definition and implementation of organizational values, mission, vision and goals. Therefore, the author has researched characteristic components of several Latvian public (mainly administrative) organizations to evaluate current situation of the EB external expression of organisations. The EB external expression is looked upon from the point of view of job seekers, who analyze and choose their potential employers by using publicly available sources of information. The aim of the research was to outline the EB importance, connection, effect and expression within HRRS based on the case of Latvia. The objective of the paper was to compare the EB external expression of socially responsible (SR) and other public sector organizations in Latvia. The tasks of the research were: 1) to analyze statistical data concerning the employment among young specialists in Latvia; 2) to outline young specialists' typical characteristics; 3) to overview employees' peculiarities in public sector organizations; 4) to perform EB literature analysis; 5) to compare the EB external expression of SR and other public sector organizations in Latvia according to the elements of EB external expression; 6) to make conclusions. The author used monographic research method, selection, comparison, induction and statistical data interpretation to explore the situation and potential outcomes of the proposed approach to HRRS. II. PUBLIC ORGANIZATIONS AND EMPLOYMENT OF YOUNG SPECIALISTS IN LATVIA Based on previous studies the author can conclude that Latvian labour market requires highly qualified specialists with work experience. Public organizations particularly require experienced specialists. (Voronchuk & Starineca, 2014) Young specialists under the age of 24 usually have poor work experience or do not have it at all; therefore it is hard for them to enter labour market. However, private sector 58 Economics and Business ______________________________________________________________________________________________ 2015 / 27 organizations provide more working places in general as well as traineeship places. (Central Statistical Bureau of Latvia, 2014) The situation is complex and median and the state statistical data wreak havoc telling that youth unemployment rate is high in Latvia. However, statistical data also show that the second popular reason why economically inactive Latvian inhabitants are not looking for a job is "studies" (25.0% out of all other reasons in 2013). Statistical data that reflect unemployment rates usually provide information on youth aged between 15 and 24. Latvia is in the transition to knowledge economy, where people are striving to get higher education. In 2013 83.7% of Latvian inhabitants with higher education were economically active which is by 11.8% more than the next group of inhabitants in the rating - inhabitants with vocational education or vocational secondary education. During the last three years there has been a tendency for the number of people with higher education who are looking for a job in Latvia to increase (LR Centrl statistikas prvalde, 2014a). Therefore people who are 15, 16 and even 17 year old rather study than work. In the beginning of 2014 there were 51 453 young Latvian inhabitants in the age from 15 to 17 that is 22.7% out of all Latvian inhabitants in the age range from 15 to 24 years (Central Statistical Bureau of Latvia, 2014a). 25.8% of economically inactive inhabitants are pupils or students. Besides, people of this age may not work as much as other mature young people in the set age group of 1524 years old under the law (LR Centrl statistikas prvalde, 2014). The author reflects that it is not correct to consider this part of Latvian inhabitants bearing in mind that youth unemployment as the result of analyzed data is not precise enough. Based on previous studies the author also can conclude that public organizations mostly are searching specialists with higher education (bachelor or master degree) for the vacant positions (Voronchuk & Starineca, 2014). The structure of the public sector provides various jobs in central and local government (nonfinancial public sector). (Voronchuk & Starieca, 2014) The author in her analysis focuses only on administrative jobs in public organizations. In 2013 in Latvia 7.41% of the total amount of employed people worked in administrative jobs in public organizations. (Central Statistical Bureau of Latvia, 2014) Latvian society is ageing, and the staff of public organizations is ageing as well. For example, 59.23% of employees of the Central Statistical Bureau of Latvia in 2013 were in the age of 45 or older (LR Centrl statistikas prvalde, 2014b). According to the author's survey in summer 2014 the average age of employees in State Revenue Service was 43 years, in State Probation Service 41 year, in State Forensic Science Bureau - 40 years, in State Centre for Forensic Medical Examination of Latvia - 52 years. Therefore there is a risk that after 1015 years there will be no specialists to replace them. One of the possible solutions could be to attract young specialists and to work on their retention. One tool that can help in this case is organizations' work on their Employer Brand. Another aspect is the existing peculiarities of young specialists. Currently young specialists with higher education 59 are generation Y representatives (sometimes also called Echo Boomers, Generation Next, Millennials, Boomlets, I Generation, Net Generation, Netizens, Generation WHY). According to the different sources they were born from 1978 2000 (Sheahan, 2006; Osborne, 2010; Matthewman, 2011). They have specific characteristics as potential employees. They could be characterized as ambitious citizens of the world who are active technology users (rste-Avotia & Lieis, 2013). They are searching for a job using Internet resources, thus written and visual information is important for them. They are attracted by active work environment and professional development opportunities in the work place (Starieca, 2014). They go with new, trendy ideas, hence they are mostly attracted by big brand names rather than the real content. From the employers' perspective it is important to give them what they want in order to be able to compete for this type of Human Resources. Thus the Employer Branding is a useful approach for Latvian public organizations under many circumstances. III. THEORETICAL FRAMEWORK OF EMPLOYER BRANDING Employer Brand is a tool for employers that can help carry out various HR processes especially those connected with external organizational environment interaction. Jain and Pal (2012) outline several EB benefits. Employer Branding can help to achieve the increase in organization's productivity, profitability, employee retention, and employer attractiveness as well as the reduction of recruitment costs and period of time from hiring a new specialist till receiving real value from his work (Starieca & Voronchuk, 2014). Also EB can enhance employee commitment towards organizational goals and contribute to minimization of loss of talented employees, as well as improve employee relations (Jain and Pal, 2012). All these benefits make organizations to think of the positive effect of some essential activities regarding their EB in general. Therefore organizations may be interested in EB implementation. The literature review helped to understand the crucial steps of employer branding process. Five different explanations of EB were compared and analyzed. Based on this analysis the general scheme of EB was developed using a linguistic tool Word Count which automatically showed the most frequently used words in the observed five pieces of texts. The main words that were used most frequently were: "employment", "employer", "identity", "directed", "external" and "employees" (Lievens, 2007; Jain & Pal, 2012; Bondarouk et al., 2012; Pahor & Franca, 2012; Kudret, 2014). It was possible to conclude that EB is "an identity of employer that is directed to the external and internal stakeholders and speaks about employment image by several criteria provided by the employer" (Voronchuk & Starieca, 2014a). Five different approaches to the interpretation of EB theoretical content were analyzed (Table I): Three-step processes of EB (Lievens, 2007); EB components (Jain & Pal, 2012); EB elements/EB mix dimensions (Bondarouk, Rul, & Weekhout, 2012); EB main characteristics (Pahor & Franca, 2012); Economics and Business ____________________________________________________________________________________________ 2015 / 27 EB mix dimensions (Kudret, 2014). The main components of EB were outlined: culture and environment of the organization, job content, features and benefits that employees can receive working for the employer (Starieca & Voronchuk, 2014). It is possible to split all the mentioned components into three main blocs: Employees and culture of an organization; External reputation of an employer; Work environment and employment circumstantial. The author summarized all the possible elements of EB and compiled a list of them (Voronchuk & Starieca, 2014a). Organizational characteristics: o What kind of organization is it? o What does organization offer for employees? o What are the organizing processes (vision, mission, goals)? People: o What kind of employees it employs? o What is expected of employees? Culture: o Internal communication; o Rewards and recognition; o Learning and development; o Service support; o Measurement system; o Current culture and ethics in the organization. Job characteristics: o Job opportunities; o Job learning opportunities; o Key functions and specific characteristics; o Introduction program. Remuneration and advancement: o Advancement opportunities; o Career programs; o Benefits and compensation system. Employment: o Working environment; o Recruitment and induction; o Team management; o Performance appraisal. Employer reputation: o Past achievements; o Social activities, sponsorship etc.; o Ratings of products and services s. TABLE I AMOUNT OF ORGANIZATIONS ACCORDING TO EXTERNAL EXPRESSION OF THE OBSERVED EB COMPONENTS, % Lievens (2007 ) Jain and Pal (2012) Bondarouk et al. (2012 ) Pahor and Franca (2012) Kudret (2014) Three-step processes of EB EB components EB elements/EB mix dimensions EB main characteristics EB mix dimensions 3.2. EB transition to the organizational culture 1. Culture and Environment Work practice, value system, behaviour and attitude of the people working in the organization 1. People and culture What kind of employees are employed? What is expected of employees? Employment conditions and treatment of employees; Current culture and ethics in the organization. 1. Good leadership and joblife balance 1. Culture Internal communication, rewards and recognition, learning and development, service support, measurement system 1. The value proposition of an EB development 2. The external marketing of EB 2. Employment Experience Tangibles (salary and benefits); Intangibles (company's culture and values, opportunities for learning and career progression, reward and recognition and management style) 2. Organizational characteristics What kind of organization it is and what it offers? How is the organization offered? Organizational processes (vision, mission, future goals) 3. Employer's reputation Past achievements, social activities, sponsorship etc., ratings of products and services ratings 2. Reputation of company and its products and/or services 2. Purpose Senior management; values/corporate social responsibility (CSR), external marketing 3.1. The internal marketing of EB 3. Integrity 4. Employment Package Financial compensation, job roles and responsibilities, work environment, career development plan 4. Job characteristics Job opportunities, job learning opportunities, key functions and specific characteristics, introduction program 5. Remuneration and advancement Advancement opportunities, career programs, benefits and compensation system 3. Possibilities for personal development 4. Security of employment 3. Employment Working environment, recruitment and induction, team management, performance appraisal Source: Starieca & Voronchuk, 2014 The aspects that can be easily evaluated by external stakeholders, e.g. job seekers - potential employees of an organization, are those that can be assessed externally. Mainly they could be organizational characteristics. Nowadays one of the easiest ways to inform external stakeholders about the organizational characteristics is the WEB page of an organization. Therefore the author evaluated the components of organizational characteristics of the set public sector organizations. 60 Economics and Business ______________________________________________________________________________________________ 2015 / 27 IV. METHODOLOGY OF THE STUDY To analyze the external expression of public organizations' EB, the author selected 30 public administrative organizations of Latvia. The selection was based on the results of previous research (organizations were chosen from the list of public organizations which were searching for new employees for administrative positions and on July 3, 2014 published their job advertisements on www.cv.lv). All job advertisements of the public organizations were published on the portal (job search engine www.cv.lv, it is easy to retrieve the job advertisements from this portal). Some of job advertisements were from municipal and some from state organizations. The filter applied to the appropriate job advertisement selection is \"State and public administration\". The results of this analysis were compared with the same analysis of ten socially responsible public organizations that were included in the Latvian Sustainability Index in 2014. SR organizations were chosen because the organizational process is one of the evaluation sub-criterion of SI. Organizations that were included into the SI rating were a priori the best examples of organizational identity expression. (Sustainability Index, 2014) All observed organizations represented nonfinancial public sector (Voronchuk & Starieca, 2014). EB external expression analysis was mainly conducted by collecting information on organizations' values, their defined vision, mission and goals of organizations that was available on the organizations' web sites. Nowadays for the job seekers, especially urban young job seekers, the web page of an organization is one of the most attainable and popular information resources about the organization. Therefore, it was reasonable to choose exactly this source to explore. Organizational processes (vision, mission, goals) are part of the organizational characteristics, whereas organizational characteristics are one of the five EB mix dimensions (Bondarouk et al., 2012). The author reviewed the whole content of web pages to find any information that discloses the organization's definition, its offers to employees, organizational process (if at least one of the components exists), vision, mission, goals, operational principles, Code of Ethics and its full text. The study is subject to several limitations. Only Latvian public organizations are examined for the exact short period defined by the set criteria. This decision was guided by simplicity of filter and comparison of Latvian organizations, as there is a Sustainability Index rating in Latvia. According to the requested data from the State Employment Agency, there were around 418 vacancies in Latvian public organizations for the first ten month in 2014, however only 30 and only administrative organizations were observed. There was only one source of information purposely used and only one EB element was purposely chosen for the observation. V. RESULTS OF THE STUDY After analyzing EB approaches and definitions, the author summarized the most frequently used words. As a result, EB could be characterized mainly by: employment, employer, identity, directed, external, employees, branding, culture, and environment. So, the essence of the Employer Brand is mainly the external expression of internal culture and environment of an organization from the employment perspective. The examined organizations were public sector organizations: administrative (all 30 from the range), one administrative SR organization, one SR higher education institution, and eight state-owned or municipal enterprises. All observed organizations had web pages. After the examination of public organizations the author drew the results by the elements of their organizational characteristics as well as by other additional evaluation criteria, such as operational principles statement and publication of Code of Ethics (Table II). TABLE II AMOUNT OF ORGANIZATIONS ACCORDING TO EXTERNAL EXPRESSION OF THE OBSERVED EB COMPONENTS, % Elements of organizational characteristics and other evaluation criteria Definition of what kind of organization it is Definition of what organization offers for employees Definition of organizational processes Definition of vision Definition of mission Definition of goals Definition of operational principles Publication of the Code of Ethics Out of 30 public organizations 93.33% 60.00% 30.00% 6.67% 10.00% 23.33% 10.00% 26.67% Out of 10 SR public organizations 100.00% 50.00% 90.00% 60.00% 70.00% 50.00% 20.00% 20.00% Sources: Latvenergo (2014); Latvijas loto (2000-2002); Rgas siltums (2014); Daugavpils siltumtkli (2013); Ventspils reiss (2014); Riga Technical University (2013); Road Traffic Safety Directorate of the Republic of Latvia (2011); Riga Internationl Airport (2009); Latvijas dzelzce (2006); Latvijas autoceu uzturtjs (2007); Uzmumu reistrs (2014); Valsts kase (2007-2014); Latvijas Republikas Finanu Ministrija (2012); VARAM (2006); VRAA (2014); Zemkopbas ministrija (2011); Tukuma novada socilais dienests (2014); Health Inspectorate of Latvia (2011); Centrl finanu un lgumu aentra (2011); VSAA (2014); Bauskas novada pavaldba (2014); Vides prraudzbas valsts birojs (2009); Zemkopbas ministrija (2011); Valsts tehnisks uzraudzbas aentra (2005-2013); Latvijas Republikas rlietu ministrija (2014);Latvijas Republikas Ekonomikas ministrija (2010); VID (2005); VAAD (2009), (2014); NVA (2005); NVD (2014); SIVA (2006-2012); LR Centrl statistikas prvalde (2014c); Jaunatnes starptautisko programmu aentra (2014); Datu valsts inspekcija (2014); VZD (2014); Labkljbas ministrija (2008-2012); Latvijas Republikas Tieslietu ministrija (2014); PTAC (2009); Lauku atbalsta dienests (2010); Valsts dzelzcea tehnisk inspekcija (2007). There were two public organizations out of 30 that did not provide clear description of the organization on their web pages. Public administrative organizations (60.00%) highlighted information on what organization offers for their 61 employees on their web pages, mainly in the vacancies section, describing offers for a potential employee. 50.00% of observed SR organizations provided the same information. Economics and Business ____________________________________________________________________________________________ 2015 / 27 SR organizations publish their defined mission in more cases (70.00%) than other analyzed public organizations (10.00%). The same situation was with other elements of organizational processes, e.g. 23.33% of the analyzed public organizations and 50.00% of SR public organizations publish their goals. 26.67% of the observed public organizations publish their code of ethics that is by 6.67% more than SR public organizations do. Operational principles are published on web pages of 20.00% of SR public organizations that is by 10% more than in the case of other public organizations analyzed. Additionally the author checked the values of organizations. Socially Responsible public sector organizations defined their values more frequently (40.00% of the SR organizations) than other public organizations from the range (10.00%). Only one out of three public administrative organizations from the sample defined its employees as a value, and only two out of four SR organizations defined their employees as a value. VI. DISCUSSION It is a fact that Latvian society is ageing. The number of vacancies for people with higher education is increasing as well as the number of people with higher education in Latvia. Labour market provides a choice of different vacancies in the common fields, therefore not only organizations are selecting future employees, but also job seekers are selecting their future employers. Even in terms of high unemployment rate job seekers have a possibility to choose some extra features of the employing organizations which are most suitable for them, especially if these job seekers are young specialists (currently up to 35 year old). This is where employers' monopolistic competition starts. The objective of the paper is to compare EB external expression of SR and other public sector organizations in Latvia. The result shows that socially responsible organizations usually care about the external manifestation of the employer brand attributes more than other public organizations. It is important to outline that the form of the public organization is important. Naturally, public enterprises are more interested to compete with private sector enterprises; therefore, they are more active in communication with external stakeholders including job seekers and potential employees as well as in caring about their reputation and services, treating carefully their current employees. Further research is needed to analyze the expression of other EB components as some of their elements can be also expressed via the internet resources or by word-of-mouth as one of the most effective communication approach. VII. CONCLUSION SR organizations are more open and adapted to employer branding. Most probably this result reflects the passive approach of Latvian public administrative organizations to HR recruitment and selection, work with their stakeholders (current and potential employees) as the biggest part among the examined SR organizations are state-owned or municipal enterprises. The research results show that public organizations in Latvia still need to improve their positioning on labour market and work harder on their EB. Even considered SR public organizations have weak external expression of their EB that cannot contribute to successful results of HRRS. However, SR public organizations generally are more open about publishing information that characterizes them as employers and influences their employer brand creation/development. The results of the study characterize the content of web pages of Latvian public sector organizations that is important for the external expression of the employer brand elements. Job seekers, who check potential employers' web pages, simply cannot find information that shows the organization as an employer. It means that public organizations of Latvia are not that oriented on the communication via internet resources with one of their important stakeholder potential employees. Nowadays young specialists are likely the most active internet resources users, therefore public organizations need to pay distinctive attention to information that they are publishing particularly the one that can affect the attraction of new candidates to the vacant positions. The suggestion for the organizations would be to devote more attention to the content of the organizational web pages. Information that can be published has to be published on the web page and be easily reached to attract job seeker and to represent the organization as an employer. The main focus needs to be on organization's definition, its offers to the employees, organizational process (if at least one of the components exists), vision, mission, goals, operational principles, Code of Ethics and its full text. If there is no such information to publish, it can be an additional point to think on. Most probably, the organization needs to develop its plan to include there all cultural aspects of the organization's management and activity as well as such strategic elements as vision and goals. REFERENCES rste-Avotia, A. & Lieis V. (2013). Jaun Y paaudze. Forbes Latvia. 11, 82-83. Bauskas novada pavaldba (2014). Retrieved Jul. 03, 2014, from http://www.bauska.lv/ Bondarouk, T., Rul, H., & Weekhout, W. (2012). Employer Branding and its Effect on Organizational Attractiveness via the World Wide Web: Results of quantitative and qualitative studies combined. The 4th International e-HRM Conference \"Innovation, Creativity and eHRM\