Recruiting in a tight labor market

Despite layoffs in the tech industry and the decline in remote work opportunities stealing headlines, the labor market is still tight. The latest labor market data from Claro shows 6.29 million job openings in the US (as of September 2023). When compared to government data showing 5.9 million unemployed workers, some quick math proves there’s still shortages.

Of course, some industries are in better shape than others. Some are really struggling for the talent they need, such as healthcare, hospitality, financial services, certain trades and professional and business services. In these labor-deplete markets, how do you attract the right talent to operate and innovate your organization?

For most enterprises cued into talent acquisition, this new reality might necessitate a variety of adaptations: enhancing total reward programs, relaxing certain job qualifications, improving schedule flexibility, rethinking strategy and tactics, boosting career training or other perks, assessing tech stacks, strengthening referral systems and streamlining candidate experiences.

Proactive recruitment and talent pipelining

For many sectors, employers will need a recruiting strategy that centers around sourcing passive candidates. And, whatever the industry, there is no substitute for maintaining a deep understanding of the market being served. Equally important, it can’t be a “one and done” effort. Most employers would benefit from a recruiting process that never sleeps. This will likely require a change in philosophy, with employers constantly recruiting, whether positions are open or not.

Read more on how to plan for the biggest skills shortages with talent pipelining here

In other words, don’t wait for a break to develop a fix. Analyze turnover trends and recruit ahead of the need. Create a talent community and bench of candidates to draw from immediately when the occasion arises. In parallel, a systematic approach to screening should focus on skills and culture fit, which will help you find individuals who have long-term potential.

Total rewards packages and hiring bonuses

Some employers, seeking to avoid permanent spikes in their cost structures, have responded by offering hiring bonuses. Although it is true that such payments offer flexibility because they can be suspended or rolled back as circumstances change, they might not even offer short-term solutions if workers only stay for a short time and then hit the market again in hopes of securing yet another hiring bonus.

Sure, employers should regularly conduct compensation benchmarking and total rewards reviews. Their offerings must be competitive. But, ultimately, pay is merely a starting point.

In this fragile environment, perks have taken on heightened importance. Benefits receiving new attention include mental health coverage, well-being programs, family caregiving support, financial planning, and — especially vital for some workers when schools are open — childcare options. Of course, allowances for home offices and remote technology also have found new currency.

Employment branding and recruitment marketing

93% of organizations are concerned about employee retention and the No. 1 way they’re working to improve retention is by “providing learning opportunities.”
Source: LinkedIn Workplace Learning Report

Higher compensation may strengthen prospective employee value propositions (EVPs) for candidates and employees, but many workers’ concerns transcend salary. They have been reassessing what they want from life and work. In this regard, human resources can benefit from consulting with marketing to improve candidate-facing employment brands. Prospects want to know not just whom they’re going to be working for, but also why they should want to join. It boils down to culture, unfiltered.

Employees’ expectations have led organizations to invest in worker training and career development. The goal is to signal a brighter career path through upskilling, provided by employers. According to LinkedIn’s Workplace Learning Report, 93% of organizations are concerned about employee retention and the No. 1 way they’re working to improve retention is by “providing learning opportunities.” Note that this does not necessarily require a complete overhaul to your learning and development program; creating opportunities for cross-functional training, internal mobility and active mentorship can go a long way.

6 steps to create a successful learning and development program

To convey all of this, recruiters must take an omnichannel approach. That means using multiple tools across different geographies. What’s more, as the saying goes, you never get a second chance to make a first impression. Beyond recruitment marketing and social media outreach, recruiters need to ensure that the interview process is memorable and enjoyable for candidates.

That “game day” experience can be a point of differentiation, meaning interviewers should be prepared. They would also benefit from pursuing deep and meaningful conversations with candidates, rather than simply checking boxes.

Checklist for recruiting in a tight labor market

To guide recruiting when there’s a labor shortage, consider these six action items:

• Tighten job descriptions: Be honest, but remember that hiring in a tight market is, in part, a sales job. Focus on unique opportunities, training, benefits and perks that provide points of differentiation from the competition.
• Attend to the tech stack: Especially with younger candidates, simplified application processes and clever social media communication send the right signals. As with so many areas of recruiting, building and evaluating the tech stack is a never-ending process.
• Invest in employees: If you provide opportunities for growth and offer an enjoyable working experience with great perks, employees will be genuinely happy at work. And employee referrals often provide the best results, and those will derive from having employees happily act as “brand ambassadors” for the company.
• Be in tune with labor market data: The labor market is always changing. And while you’re likely up on the trends as they’re evolving, make sure you give recruiters, legal counsel and third-party providers regularly updated information on employment trends and the projected impacts on your business.
• Consider creative perks: The new allure of remote working may not work for all positions (although it might be just the thing for industries requiring a return to office). Survey your employees and candidates to determine what stands out for them. It may be flexibility, gym memberships, mental health programs, tuition reimbursement and so many others.
• Have flawless recruitment process fundamentals: Rethinking assessments, streamlining the interview process and postponing background checks can cut risk and expedite processes that might otherwise languish. Another tip? Communicate to candidates at every step of the process so they don’t fall out.

To achieve these goals, employers may benefit from a third-party recruitment process outsourcing (RPO) provider that will take a comprehensive and unbiased evaluation of the recruitment process. Certainly, with global experience spanning all industries, including during times of uncertainty and labor shortages, talent providers can navigate the most challenging situations – and position you as an employer of choice in a tight labor market.