Blockchain which first made waves in the finance industry is now gaining popularity across other industries as well. In a sense blockchain addresses a central issue in the technology landscape – trust. As a decentralized ledger with multi-chain data protocols, blockchain promises to be an infallible record of information. Blockchain has given rise to a new business model that is built on technology, rather than reliance on people as intermediaries. This is exactly what makes blockchain a valuable tool for the recruitment industry.
Speaking exclusively to HR Technologist, Abakar Saidov, CEO at Beamery, said, “Blockchain has the potential to fuel the TA as a whole. The reason is identity and personal data is at the core of TA and security is central to the blockchain value proposition.”
“The beauty of blockchain is that companies can retrieve verified candidate data while keeping it anonymous and adhering to data privacy regulations. Having verifiable data is key because TA departments deal with critical information like background checks, educational institutions, salary history and more. And accurate candidate data is imperative when making informed hiring decisions,” he adds.
While recruitment applications of blockchain are still in their infancy, HR technology companies have already begun exploring its various possibilities. Here are three ways blockchain could transform recruiting:
Credential Verification: According to HireRight’s 2018 employment screening benchmark report, 84 percent of employers caught applicants lying on their resumes. A blockchain-based credential verification system could help reduce the time spent on conducting background checks, reducing fraud, and build more trust in the recruitment ecosystem. Given millennials’ frequent job-hopping tendencies and the gig economy, background checks are becoming more complex and time-consuming. As organizations strive for improved efficiencies in the recruitment process, ensuring a quick, reliable and cost-effective screening process is essential. Blockchain could help recruitment teams strike a balance between speed and accuracy while helping contain costs. “The more accurate data we can retrieve about candidates, the better we can market to the right candidates and match individuals with the right jobs. This is at the core of what Beamery does with its Talent Engagement Platform and Candidate Relationship Management capabilities,” says Abakar. Colleges and universities could publish encrypted academic credentials to a blockchain which would enable candidates to view and share these with potential employers. In fact, MIT has developed a digital diploma pilot program, where students receive an encrypted certificate upon the completion of the course. Students can add and display their certificate on a mobile wallet application and share the file directly with potential employers.
Employment histories: Candidates don’t just lie about their qualifications, many also provide false employment histories to pad their resumes up. As most recruiters rely on reference checks to verify employment history, multiple phone calls and emails make it a long-drawn-out process. It is also challenging to track down references who’re no longer with the company. Similar to academic credentials, blockchain can also help recruiters verify a candidate’s past roles across various organizations in detail. This record can be verified by each employer to prevent candidates from publishing false information. Once verified, the employment history cannot be altered, thus preventing candidates from manipulating their records. CVerification is a blockchain development that works with decentralized background verification platforms to ensure the truthfulness of a candidate’s past employment details.
Data Security: As the recruitment process becomes increasingly reliant on technology to drive higher efficiencies, the recruiters have access to a lot of sensitive candidate/employee data. With data-privacy regulations like GDPR coming into effect, it becomes critical for recruiters to store this data responsibly. The current practice of uploading and storing data on a cloud server makes it susceptible to hacking and data-tampering. Blockchain enhances data security by breaking all data into tiny chunks and distributing it across an entire network of computers. Each computer will have a complete copy of the data, therefore, preventing data loss in case one or two computers in the network go down. Moreover, due to its decentralized nature, blockchain is virtually impossible to hack. The data is encrypted and cross-checked by the whole network. Every legitimate transaction needs multiple confirmations from different users (nodes) on the network.
Most blockchain applications for recruitment are still in the theoretical stage, however, it’s potential cannot be ignored. Blockchain is certainly more than just Bitcoin or cryptocurrency, and it will a central role in the hiring process to help organizations get the talent they are looking for.