Where Are All the Qualified Candidates? Aren't We In a Recession?

Everybody assumes that every job you post will result in an onslaught of candidates during a down economy.  After all, you have people being laid-off in droves, why wouldn't recruiting be easier?  That case was also made in the lead article of the 11/27/08 edition of Workforce Recruiting titled "Unlike Most Employers, Mass Mutual is on a Hiring Spree".

A reporter from a local newspaper also recently forwarded me a study from SHRM called the "hiring difficulty index."  The running index was an ongoing survey designed to chart how hard it is to hire people at different points in time.  The index also suggested that it's getting easier to hire people in a down economy. 

Both are good thoughts, but both are wrong on many levels.  Here's why - stay with me on this one.

Voluntary turnover goes down during recessions. It’s a fact that during recessions, fewer jobs are available. It doesn’t take a Harvard MBA to determine that means fewer companies will be actively stalking your talent, which means reduced voluntary churn across your employee base. 

The good news is that with unemployment levels in the low single digits for the past couple of years, lower turnover is going to feel like a vacation.

The bad news is that when the economy turns bad, a lot of the talent you need for open positions (the high performers with skills that are a direct match) becomes risk-adverse, meaning they won't be interested in your opening.  After all, if the world around you is conducting layoffs and you feel like you are relatively secure where you are, why on earth would you look to change jobs in a recession?  All that will do, in the minds of the best candidates, is expose them to a situation where they don't have all the information and might get laid off three months into the new job.

Translation - I'm safe where I'm at, so I'm not going to put myself on the market right now.

Result - While there are many candidates in the marketplace, the ones you really need - the high performers with skills and experience that are a direct fit for what you need - are hunkered down inside their companies, and won't consider a move until the economy improves and the layoffs stop.

Recruiting's not easier in a down economy, because the candidates you really need for your openings aren't interested in moving.  They're hunkered down inside their current company, and they're not coming out of hibernation until the recession is over.  Retraining of employees is great, but that won't appease the hiring manager you have to deal with who expects a direct match to their needs.

For that hiring manager, retraining or accepting a candidate who's a 60% match, but available immediately, isn't something they're interested in.  Unfortunately, that means your time to fill is going to be higher than you would expect in a time of high unemployment, and it also means the average time required to find a job for some very credible candidates is going to be higher than it needs to be.

Recessions stink.  Who would have thought it's harder to recruit now than in the boom times?

Everybody assumes that every job you post will result in an onslaught of candidates during a down economy.  After all, you have people being laid-off in droves, why wouldn't recruiting be easier?  That case was also made in the lead article of the 11/27/08 edition of Workforce Recruiting titled "Unlike Most Employers, Mass Mutual is on a Hiring Spree".

A reporter from a local newspaper also recently forwarded me a study from SHRM called the "hiring difficulty index."  The running index was an ongoing survey designed to chart how hard it is to hire people at different points in time.  The index also suggested that it's getting easier to hire people in a down economy. 

Both are good thoughts, but both are wrong on many levels.  Here's why - stay with me on this one.

Voluntary turnover goes down during recessions. It’s a fact that during recessions, fewer jobs are available. It doesn’t take a Harvard MBA to determine that means fewer companies will be actively stalking your talent, which means reduced voluntary churn across your employee base. 

The good news is that with unemployment levels in the low single digits for the past couple of years, lower turnover is going to feel like a vacation.

The bad news is that when the economy turns bad, a lot of the talent you need for open positions (the high performers with skills that are a direct match) becomes risk-adverse, meaning they won't be interested in your opening.  After all, if the world around you is conducting layoffs and you feel like you are relatively secure where you are, why on earth would you look to change jobs in a recession?  All that will do, in the minds of the best candidates, is expose them to a situation where they don't have all the information and might get laid off three months into the new job.

Translation - I'm safe where I'm at, so I'm not going to put myself on the market right now.

Result - While there are many candidates in the marketplace, the ones you really need - the high performers with skills and experience that are a direct fit for what you need - are hunkered down inside their companies, and won't consider a move until the economy improves and the layoffs stop.

Recruiting's not easier in a down economy, because the candidates you really need for your openings aren't interested in moving.  They're hunkered down inside their current company, and they're not coming out of hibernation until the recession is over.  Retraining of employees is great, but that won't appease the hiring manager you have to deal with who expects a direct match to their needs.

For that hiring manager, retraining or accepting a candidate who's a 60% match, but available immediately, isn't something they're interested in.  Unfortunately, that means your time to fill is going to be higher than you would expect in a time of high unemployment, and it also means the average time required to find a job for some very credible candidates is going to be higher than it needs to be.

Recessions stink.  Who would have thought it's harder to recruit now than in the boom times?

Comments

[Alan]

We have been trying to fill some positions lately and have had a difficult time with some while finding luck in others. The problem has been in the Accounting area. Since we lost a Senior Accountant about 6 months ago, we've had a revolving door with about three coming in and then leaving soon thereafter. We haven't been able to determine whether they just didn't like the job, whether they expected more in pay, or whether it was something else. We've just made an offer to the fourth person and hope that she will find us challenging enough to stick around.

On the same note, we've also hired some new people in our IT Group. We had a cleaning out of some of the old regime and brought in some new faces. This was no easy task eaither, but the results have been much better than the Senior Accountant position.

What is it with these positions that require technical or financial expertise? Some of the candidates we've talked to (and who have come and gone)seem to be emotional cases. It makes you wonder whether instead of coming into a new company with confidence and enthusiasm, they instead come in with insecurities and don't have a clue what they really want in a job. Some new recruits seem to be on the verge of running out the door before they get through their first week. No matter what the comapny or the Department may do to make this new employee's first two weeks as pleasant as possible, I wonder if there is something else at work here caused by our current economic condition that makes these new hires so wishy-washy.

[Meg Bear]

As a manager trying to retain and engage her staff, I have to say your pain is my gain (assuming that people are keeping their heads in the game while they stay).

[Joel Kimball]

Thought provoking as always, KD. I think it totally depends on the skillset/discipline sought and the hiring-company's brand/image/situation. Just within engineering, some areas are white hot and you have to cherry pick (and overpay) to get anyone, while others have loads of available, real talent out there with little need. Some companies are shifting their focus or rebuilding and may be hiring in one area while laying off in another. Others are sunk and hiring no one...still others are growing and thriving in this environment. All will present different options and levels of attractiveness to different potential candidates.
So while I do agree there's some retrenchment of great talent in some areas in this market, we're also seeing a bounty of really, really good people in certain areas who are available, able and willing.
Let's face it - recruiting's never easy. As I remind my folks occasionally, "that's why we call it work." Then we laugh and get back to it :) Good post!

[Ben Yoskovitz]

At ERE in October I was sitting around with a few people and someone asked, "So will hiring get easier in the downturn?" And universally the answer was NO.

I believe that was reiterated during one of the presentations as well. I think what you describe is a good argument for focusing on strategic recruiting vs. shotgun recruiting. You know it will take longer, but at the same time you probably have a bit longer to recruit if you're not as desperate or not hiring as many people. So get strategic, build the basic of your recruitment plans, and gain more value long-term.

[MN Headhunter]

December 5th is the next release of unemployment numbers. Digging through them gives a better picture of who is unemployed.

As an example, October numbers show a 3.1% rate for those with college degrees.

For teens it is 19.3%

[Darcy Eikenberg]

The challenge for great candidates is not just in the risk of making the move, but in the risk of knowing you'll be as successful in the new place. It's not as much about the "jump," but about the "landing."

I'm a coach for aspiring leaders, and one recruiter I work with is offering her candidates the gift of three sessions with me after they accept the job offer. This investment makes sure candidates know they will have professional, unbiased support once they have "landed" to help them navigate the new organization and role. We are just testing this concept, but candidates are interested and the offer is seeming to help lessen the perceived risk of making a change.

In the past, recruiters might have thrown more salary, bonus, or stock at candidates to help them manage the risk of change. Today, with risk at a higher profile than ever, we need to get more creative.