The Benefits of Recruiting Talent Internally

By George Waggott, founder, and Roberto Fonseca Velazquez, law student

George Waggott Law

A recent article published by Deloitte argues that organizations often struggle to execute strategy effectively because they fail to tap into one of their greatest resources: their existing workforce. In a competitive job market with high voluntary turnover, internal mobility - the practice of filling roles with current employees - offers a powerful solution to attract, retain, and engage talent. Despite the clear benefits, many organizations overlook internal talent due to cultural resistance, structural barriers, or misaligned HR practices.

Promoting internal mobility creates numerous advantages. It reduces recruitment costs, preserves institutional knowledge, and boosts employee engagement and loyalty. Many workers prioritize career advancement over salary alone, and will leave organizations that do not offer clear growth pathways. Yet many companies discourage internal hiring, either implicitly through talent hoarding or explicitly by preventing recruiters from approaching internal candidates.

A widespread issue is that internal hiring processes are underdeveloped. Recruiters and career development professionals often operate in silos, and internal job postings are poorly communicated or ignored. Even when companies recognize the value of hiring from within, they frequently fail to act on it. While most employers agree that internal mobility helps with retention and talent attraction, few organizations actually implement robust programs to facilitate internal mobility. As a result, many skilled employees leave their employers due to a lack of opportunities for advancement, which weakens organizations’ talent pipeline and brand.

Companies that effectively link talent strategy to business performance treat internal hiring as a core function. High-performing organizations create a strong culture of growth through coaching, cross-training, and showcasing employees who have advanced within the company. These efforts build a culture that encourages employees to view their career path as a long-term journey within the organization.

Transforming an organization’s culture in this way requires leadership support. Leaders need to go beyond nominally endorsing internal hiring by implementing concrete policies like linking internal hiring to performance metrics. Organizations like Home Depot and Mayo Clinic are reported to have embedded internal mobility into their operations by highlighting upwardly mobile employees, planning career paths, and rating managers on their ability to develop internal talent.

HR professionals can play a critical role in making internal mobility successful. Despite internal hires being cheaper and better performing over time, many organizations devote only a small fraction of their recruitment budgets to internal candidates. High-performing HR teams integrate talent acquisition, learning, and career development functions to streamline the internal hiring process and create an organizational culture where employees build long-term careers within the organization.

Employers that reimagine HR can create systems where every interaction with a candidate applying for a position - whether they’re selected for the position or not - becomes a development opportunity. A rejected internal applicant can receive feedback and a clear path to close skills gaps, fostering a sense of belonging and future potential. Targeted internal mobility efforts can significantly increase retention and engagement among employees of the organization.

By linking culture, leadership, and HR strategy, organizations can replace a cycle of attrition with a virtuous cycle of growth. A strong culture of internal mobility reinforces an organization’s brand, draws in ambitious talent, and drives business performance by investing in known, capable people who understand and align with organizational goals.

For more information about George Waggott Law, please see: www.georgewaggott.com, or contact: george@georgewaggott.com