With industries and organizations across the country in varying stages of reopening, there is one statistic that we as a country have never seen before in our lifetime – as unemployment soared these past few months, active job seekers in turn declined. A dynamic of the pandemic for sure, but it leads many business owners and talent acquisition leaders to ask what this indicates for the talent market as many businesses begin to open up, and for the months to come.
As we look at the employment trends pre-pandemic with an unemployment rate that hovered around 4%, many of our U.S. industries saw a demand for talent that often superseded the active job seekers available. As we’ve heard so many times before, ‘it’s a job seekers market’ and organizations have to compete to hire and keep quality candidates. Conversely, we are now hearing some talent acquisition and HR leaders say we will now see a shift to a more company driven market with organizations having their pick of qualified candidates, as businesses and organizations begin to get back to work. Here’s why we know that thinking will be short lived, and why talent acquisition leaders and business owners should always be focused on sourcing and building a continuous pipeline of candidates.
To begin to understand what is happening and as we look toward the future of talent acquisition, we pulled data on active job postings and active job seekers for five of the top industries in the U.S. (Healthcare, Technology, Construction, Retail and Production/Manufacturing).
Not surprisingly, in April 2020 job postings were down across these industries – 26.9% YOY. Historically, when the economy declines, active job seekers increase. However, in April of this year, the active job seekers in these industries were also down and by a whopping 28.6%.
Check out our infographic below, and click on it to expand and download:
While it’s typical to see job postings decline amid soaring unemployment, it is not so typical to see such a hefty decrease in active job seekers. In fact, we would expect to see a sharp increase in active job seekers amid high unemployment.
These unprecedented results mean that people who were actively looking for jobs before the pandemic, and those that lost their jobs during the pandemic, are not actively searching for new opportunities. There has been quite a bit of speculation as to why people stopped looking and some of those speculative reasons include:
- Health concerns, afraid to go back to work
- Lack of childcare
- Mental health challenges
- Favorable unemployment benefits
- Decided to stay in their current job (even if they were previously looking), out of fear to make a change in an uncertain market
With the notion that active job seekers have declined and passive job seekers may opt to stay in their current jobs, we may see an altered form of a candidate driven market. While pre-pandemic demand for talent often superseded the available talent in the market, now employers will have to contend with yet another set of factors imposed by the pandemic (i.e. health concerns, childcare issues, etc.) leading to an even tighter talent pool, at least in the near-term.
As phased re-openings across many states has begun, we will gradually see a resurgence of demand for talent across many industries. A survey released by the Federal Reserve Bank of Philadelphia indicates that an economic recovery should start in Q3 with job gains averaging 2.3 million per month. Another sign that companies are again beginning the process of hiring comes as Glassdoor just announced the rate of weekly declines for job postings has slowed to 1.3% (as of May 11, 2020) from 7.8% in March.
The question now becomes are organizations and leaders in talent acquisition prepared for the unseen hiring challenges they will face in the wake of the pandemic. As hiring needs will shift in unknown phases for various industries, you should be prepared that pre-pandemic hiring challenges may be exacerbated, and overall the hiring and talent landscape will likely look different from anything we have seen before.
Creating a Safe Environment
Some of the biggest pre-pandemic challenges such as job syndication and how do I make sure my job postings are being seen by the right audience will now be overshadowed by things like how we communicate and ensure prospective candidates that our company is a safe place to come to work. You’ll need to craft the right employer brand messaging and align your practices with CDC regulations to ensure that your employees feel safe in your office environment.
With many prospective job seekers having concerns over their health or the health of a family member and a vaccine that will probably not be available for at least another year, organizations will need to get creative in their messaging to make prospective candidates feel that they are offering their employees a safe working environment.
Working from Home
This brings up another challenge, as we’re now seeing statistics that say work-from-home (WFH) will remain a trend for many organizations into the foreseeable future, especially as many organizations had moved toward a more open working office environment over the past 5 -10 years. Global Workplace Analytics estimates that 25-30% of the workforce will be working from home, multiple days a week by the end of 2021. With increased opportunities to work-from-home, talent will become increasingly competitive amongst organizations who are unable to offer a virtual work option.
For organizations shifting to include work-from-home options, talent leaders and hiring managers are now looking at a new set of criteria as they evaluate candidates, from virtual engagement to capabilities in technology to productivity in a virtual setting. Potentially, you are now open to an even wider geographic location of candidates than before, so you have to shift your sourcing activities to accommodate that increased candidate pool.
In a talent driven market, we know that passive candidates are imperative to a strong talent acquisition strategy. Approximately 70% of candidates are passive job seekers, while only about 30% are active job seekers. Based on the data that we’ve seen amid the pandemic with active job seekers declining, you can be assured that passive job seekers will be even more cautious to make a career move with the continued uncertainties as a result of the pandemic.
In fact, in a recent study conducted by ADP Research Institute, 70% of workers surveyed in March-April 2020 felt confident that they would retain their jobs for at least the next month. This could mean that organizations will have to rethink their passive recruiting strategy. It’s not enough to be a great place to work and have great benefits, you will now need to actively engage with available candidates to ease fears that if they take a gamble in making a career move right now, that it’s the right one.
Digital Recruitment Marketing Strategy
As organizations begin to get back to work, use this time to enhance your recruitment strategy rather than wait till the demand for talent again outpaces the supply. If your digital recruitment marketing strategy is not your organizations strength, you need to take action now.
First impressions matter and for most organizations that impression is made digitally, especially to prospective candidates. In today’s world, and perhaps even more so in the post pandemic environment, it is imperative that you have processes and technology that can easily adapt to changing market needs enabling your organization to appeal to prospective candidates in several ways:
- First, you need to make it easy for prospective candidates to find and apply to your jobs (ex. modern candidate UX and job proliferation).
- Next, your potential candidates need to be able to learn about your organization. There is extensive information online, and you want to be aware of and help control the messaging about what it’s like to work for your organization (ex. optimized digital footprint with a clearly defined employee value proposition).
- And finally, you need to make the process efficient for your internal team to review candidates that have applied and get back to them in a timely fashion (ex. streamlined tech stack and talent acquisition processes).
Your goal should be creating a great virtual candidate experience.
Building Your Pipeline Ahead of Demand
As we mentioned before, don’t wait for demand to again catch up to supply – we all know it will. Use this time to actively build your candidate pipeline and build relationships with those candidates who would make a great addition to your team and help your business evolve in this climate. The best organizations are constantly sourcing for quality candidates and top grading their current workforce, and continually upgrading lower performing employees with more qualified talent.
Even if you aren’t hiring today, you should identify the talent you need in your organization and develop those relationships to secure those candidates when the need arises. While other organizations wait until they have an open role to start sourcing – you will be prepared with A+ talent that will help you navigate and transform your business to meet market changes.
Don’t wait for supply to get back to its pre-pandemic rates to get a jump on your recruitment strategy. Contact us today to establish a world class recruitment process.