2022 is a tough year for the job market.
The COVID-19 pandemic has caused widespread economic disruption, with millions of Americans losing their jobs. And even now, as we’re clawing our way out of a pandemic economy, a period of major economic downturn looks inevitable.
We learned a lot from the Great Recession of 2008, and while the situation is different this time around, the main lesson is still the same.
During tough economic times, your hiring process needs to change.
But… are we actually in a recession?
Economists are divided on whether we’re currently experiencing a recession or not. The National Bureau of Economic Research (NBER), the body that usually declares it, is yet to give the official word.
It’s true that back-to-back negative GDP quarters and rising interest rates usually indicate a recession, but the story is more complicated than that.
Recessions in the U.S usually sees:
- A sharp decrease in GDP (which we are seeing)
- A sharp increase in unemployment (which we’re not)
These two factors usually feed into each other. A decrease in economic output means companies have to cut costs, resulting in layoffs and hiring freezes. People stop spending as much, leading to a decrease in business profit. And on it goes.
But in 2022, the unemployment rate has actually dropped. To 3.5% in July 2022, in fact – the lowest since February 2020.
This is consistent with what we’re hearing on the ground. Everyone we know seems to be hiring and struggling to fill positions. Yet, data shows that there are currently over 11 million unfilled jobs in the U.S.
The economic downturn may be caused by a lack of confidence in spending due to high inflation. This puts a strain on businesses, yes. But in a post-pandemic economy where workers are hard to come by, many business owners may be reluctant to cut costs by laying off workers.
That’s why economists speculate that if we do go into a recession in 2022, it won’t be like any recession that they’ve seen before.
What does this mean for those who are hiring?
This is a unique time for hirers.
We’ve seen the trend of the Great Resignation movement and very high job openings over the past two years.
Source: Bureau of Labor Statistics
Companies are still desperate to make hires, even as the economy is contracting. But this state is unsustainable.
Best case scenario: the economy improves, and output increases. But at some point, the economy may also contract to a point where businesses can no longer afford to make new hires. So they will either put hiring on hold or begin making cuts.
This is why it’s so important for hirers to focus on preparing and making the right hires now.
The market is candidate-driven right now, but that may change very quickly. As a result, recruiters and hiring managers must rethink their strategies and prioritize data-driven hires to help their businesses weather any economic storm.
5 Things You Need to Do Differently
Every recession comes with different challenges. But when hiring during a recession, there are key changes you can make to your hiring practices to ensure that the wheels keep moving, no matter what the world throws at you.
Tip 1: Streamline the Screening Process
The screening process is a lot.
And this is especially relevant for those hiring in the tech industry.
The key is to make it easy for yourself.
If you can do it in one step, why take two?
Zone in on the key skills that you’re looking for in a candidate and choose the most efficient way to test them. That might mean adding a screening question to the application or one technical test instead of two.
The reality is that most applicants won’t make it to the interview stage, and you need to get to the most suitable candidates as quickly as possible.
The key is ensuring that each stage of the process is designed to assess a specific skill set or quality. This will help you weed out candidates who are not a good fit early on, saving you time and effort in the long run.
We go into a lot more details here on how you can speed up that screening process.
Tip 2: Move Quickly
Time is of the essence, and even more so when you’re hiring during a recession.
Hiring is a costly process, so make sure that you’re not burning money trying to get the perfect candidate. By the time you finish prospecting, they might already be snapped up by another company. Fast and attentive responses also tend to make a better impression on quality candidates.
If you’re scouting for some talent, you can reduce your time-to-hire and increase the chances of getting a response by using tools like Contact Out to get contacts on LinkedIn in seconds.
It’s also not just about the efficiency of the tool but the accuracy. You can read some of our case studies to see how recruiters like yourself have streamlined their contact hunting process.
(Our email search database is pretty good too, just saying. Give it a shot.)
Tip 3: Focus on Fit
Talent acquisition during a recession is all about strategy.
Make sure you’re making decisions on your hiring plan and candidate selection that is based on the latest recruitment data. Predicting a realistic time-to-hire and anticipating likely issues will allow you to work more efficiently and save your company more money.
(This State of Tech Recruitment industry report is a good place to start if you’re in the tech industry.)
Make sure you’re clear about the role and level of expertise needed in the job descriptions, and focus on the most qualified candidates. It’s important at this time that you make decisions informed by the workplace atmosphere, the team, and the likelihood that the candidate will integrate well into the workplace.
Be aware also that a recession usually sees the older people in the workforce retire, which means that you need to fill spaces in those roles. Try to build succession lines early for a smoother transition and match the qualifications of the candidates to the holes the older employees will leave behind.
Tip 4: Build Your Network
It’s especially important to cultivate your circle of contacts before and during recession years.
Building personal relationships with top talent will make them more likely to hear you out when you’re headhunting. Knowing a candidate more personally will also speed up the screening process.
You can also cast your net wider to reach candidates beyond your immediate area and offer remote work as an option if the role you’re trying to fill allows that. Non-traditional talents and candidates on different continents may be the perfect fit for your business, and you won’t know until you send out feelers in their direction.
Having a wide network also lets you fish for candidates in the talent pool more effectively, and you’ll likely be able to find a guy who “knows a guy” that can get you in direct contact with them. This will help cut down that exhausting process of chasing down emails and phone numbers.
Tip 5: Listen
It’s a difficult time for everyone. Employers want to make sure they and the people that rely on them survive through the lean years. Unsurprisingly, this takes a mental toll on business owners and hiring managers.
Job seekers may also be desperate to land a job – any job, and headhunting candidates may be scared to leave secure positions in their current jobs for a new position.
You hold a lot of power in your role, and the most important thing to do in this situation is to listen.
What do employers need? What do candidates prioritize?
In a long period of insecurity, you might see people with talent turn down dream jobs for one that offers better wages and benefits. But the story is different for every field, and some candidates will turn down better pay and benefits for more job security.
On the flip side – our studies reveal that if you’re a recruiter in the tech industry, you’re more likely to get candidate rejections.
So make sure you respond with empathy during each step of the process, and take it easy on yourself if you’re having a hard time filling roles (especially for the tech recruiters reading this!)
A recession is a hard time to get through for everyone, but we won’t get through it by being callous about people’s needs.
A little kindness is free and goes a long way in tough times 💖
Recruiting is hard enough…
And recessions make everything harder. But as with everything, being prepared and bracing for the worst will help you weather the storm.
But remember! In times of crisis, put on your own oxygen mask before helping other passengers with theirs.
Your role takes a mental toll, and being in the trenches recruiting during a recession means that you see the front lines of it more than other people. Take care to plan with your mental health in mind. Any strategy that compromises your mental state is unsustainable.
Lean on the resources available to you, and let’s get through this together!
Ready to speed up your recruiting process? Get started with Contact Out for free today.