Why meeting candidate requirements during an economic recession is essential
Economic downturns and recessions are historical facts. They happen roughly every 10 to 12 years and often affect life and the economy for years afterwards.
However, businesses still need to recruit workers, and people need jobs to survive and enjoy life. That said, for Recruiters to successfully attract the top talent they need to survive and thrive during an economic downturn, they’ll need to adapt their strategies to remain relevant.
As we teeter on the brink of a global recession that could last through 2023, according to economist Nouriel Roubini, who predicted the 2008 financial crisis, we are in for a ‘long and ugly’ global recession. If Nouriel Roubini is correct and given his track record, there is little reason to doubt him; Recruiters will need to build a multi-tiered talent attraction strategy to remain competitive and proactive.
In difficult and uncertain economic times, consumers and companies alike tend to spend less money than usual, overheads are slashed, and companies think more about layoffs than recruitment. As hiring is expensive, the temptation is to freeze hiring and associated onboarding to reduce costs, especially if there is the prospect of cuts and layoffs in the future.
However, economies recover, and businesses that haven’t driven growth risk being left behind those who planned for the future. So, consider adopting a strategic and thoughtful approach to your recruitment instead of freezing hiring.
These should include the following:
- Redefining your employee value proposition (EVP) and your approach to equity, diversity and inclusion (EDI)
- Assessing talent needs
- Automating TA processes like communication, onboarding, advertising, market data, and scheduling
- Reassess the expectations of the candidate and employee experience
- Review requirements of RPO services and their staffing/recruiting suppliers
Additionally, candidate and existing employees’ expectations around hybrid or remote working post-Covid-19 can’t be ignored as this has become a critical attraction and retention tactic.
Five tips to help you recruit successfully during economic downturns and recessions
1. Take your time
It’s common during economic downturns and recessions to slow recruitment down or even to freeze all recruitment. However, ceasing all recruitment may be unnecessary; instead, take the time to take a step back and assess the processes you have in place.
Search for inefficiencies, bottlenecks and wasted time in your recruitment processes. Look at your key recruitment metrics so you can identify your largest problems and look at how you can improve them with a strategic investment, like an RPO partnership that could help you optimise your recruitment processes.
Also, take the time to identify areas to focus on improving while your hiring efforts are slower. For example, this could be putting time into improving your candidate experience, so you have a better chance of attracting top candidates for the roles you are still recruiting for.
2. Make the most of your competitor’s layoffs
Warren Buffet famously said, ‘Be greedy when others are fearful, and fearful when others are greedy.’
What does that mean for businesses in an economic downturn?
Instinctively, when times are hard, companies reduce headcount to cut costs and try to remain profitable and competitive. These layoffs allow you to invest in the talent they have cut and achieve a much higher return on investment (ROI) than in a tight labour market.
Additionally, you can expect these employees to be more loyal and motivated than candidates who have lots of offers and feel they have many opportunities elsewhere.
As you invested in them when they needed an opportunity, they’ll be more likely to stay with you when the economic conditions improve.
3. Choose quality over quantity
During an economic downturn or recession, you’ll often have limited resources to work with, and your hiring will slow down to reflect this situation. Therefore, attracting quality candidates that can fill multiple needs in your organisation will be more cost-effective than hiring several candidates to achieve the same effect.
Do bear in mind that a quality all-rounder will have plenty of opportunities and may command a higher salary and benefits. However, this will still be less expensive than recruiting several candidates to cover the same needs.
4. Don’t forget underappreciated candidates
In his book Talent – how to identify energisers, creatives and winners around the world, renowned economist Tyler Cowen speaks about focusing on underappreciated groups.
Regrettably, women are still undervalued, as was shown by a study of managers in 20 Fortune 50 companies who were found to have quicker progression and higher salaries than their female counterparts with similar experience, education and length of service.
People with disabilities are also underappreciated in the workforce, even if they have the required skills and knowledge. By focusing your hiring efforts on underappreciated groups, you’ll have the double bonus of a high-quality talent pool and improving your Equity, Diversity & Inclusion (EDI).
Research shows that improving diversity in your workforce boosts decision-making and financial performance in an organisation.
5. Focus on your current employees
Hiring new employees may not be an option during an economic downturn or a recession. However, leveraging the talent you already have certainly can be if you build on the skills you already have in-house by upskilling your existing employees.
Investing in training and development has the added benefit of helping to avoid layoffs as you increase the value of your employees. Additionally, though historical data suggests that employees stay in their jobs during economic uncertainty, a recent survey found 30% of Americans plan to quit their jobs in the next 6 – 12 months despite the likelihood of a recession.
How an RPO provider can support you in uncertain economic times
For traditional recruitment agencies, economic downturns and recessions can spell big problems. Uncertainty causes panic and loss of confidence, resulting in redundancies and a significant slowdown in hiring.
RPO providers have a distinct advantage in these situations. Given their inherent agility, they can assist organisations with talent pipelining for the expected recovery, help with employee retention initiatives, design business continuity programs and process efficiencies, and take the strain from your in-house team on any critical recruitment.
The 2008 global recession shows that the RPO industry will thrive during and in the aftermath of the current economic downturn or recession, precisely as it did during the Covid-19 pandemic.
Should the recession be as difficult as predicted, RPO providers can take up the slack as in-house teams are downsized and will be there, demonstrating their true value as the economy recovers. Their ability to remain agile and quickly scale as the businesses they work with want to hire rapidly and ramp up productivity will see the spending on RPO solutions continue to rise.
If you’d like to discover how Recruitment on Demand can be your RPO provider of choice, call us on 01252 624 699 or email email@example.com