Layoffs. Hiring freezes. RIFs. The corporate world thinks we’re heading into an economic downturn.
Companies large and small are making the difficult decision to pare down their workforces. Netflix. Carvana. Stitch Fix. Coterie Insurance. Sometimes even thousands of employees.
While we know little about the future, you can do your best now to prepare for uncertainty and a potential recession.
The 2022 recession may have already begun & could last years
CFOs and other financial market experts predict the recession may officially hit in the first half of 2023 and last at least a year. And 40% say inflation and the looming recession are their biggest concerns.
Many on Main Street have already started taking precautions to avoid disaster once the economic downturn affects their revenue numbers.
To learn how you should react and plan for the future, analyze the Great Recession, the pandemic and other economic slowdowns.
Hiring trends during economic downturns
Contrary to the last two years when candidates had the upper hand in the job market, companies like yours now have more leverage. With more job seekers than open positions, it’s somewhat easier to access top talent.
What does this mean?
- Candidate experience is (always) vital to attracting the right job seekers
- Recruiters should still value quality over quantity of hires
- Employers must act quickly to get the talent they want
Although speed-to-hire is the name of the game during any economy, you must still prioritize candidate quality over quantity. The best available candidates disappear quickly off the market, so wooing them with a strong, genuine candidate experience is critical.
Industries & responses differ
Understand that despite a looming recession, the state of the economy affects each company and industry differently.
For example, bowling alleys are impacted negatively as most households cut miscellaneous, “nice-to-have” expenses during crises. On the other hand, grocery stores traditionally perform better during economic downturns because workers choose to make meals and dine at home rather than eat at restaurants.
Look at the data and trends from past slowdowns to see how your industry may be impacted this year. Analyzing your top competitors’ responses will give you a good idea as to how your vertical acts.
“The more you know about the past, the better prepared you are for the future.” Teddy Roosevelt might as well have been talking about recruiting during a recession. When planning your economic response, don’t make these costly mistakes:
2 hiring strategy mistakes made during a recession
Are you still recruiting and meeting your hiring targets? Or have you started to slow down your hiring and maybe even implemented a hiring freeze as we enter the recession? Or somewhere in the middle – a wait-and-see approach?
No matter your hiring strategy, make sure you don’t make these critical mistakes during your bout with the economy.
Implementing a hiring freeze
You’re driving down the highway and you see something in the road a mile ahead. You squint to determine what it is. But can’t see. You ask your passengers but no one can make out the object.
As you approach the mystery item, you don’t slam on your breaks to a grinding halt – sending your passengers’ heads into the seat in front of them.
No. You slow down. And confirm it’s safe to pass. (The momma duck and her ducklings thank you.)
Back to recruiting:
Many companies have hired and grown at a torrid pace over the last two years. As we head into a possible economic downturn, don’t implement a hiring freeze and suddenly stop recruiting altogether.
Your recruiters’ heads won’t whiplash. But your decision is likely to cause more harm than good.
In fact, the Harvard Business Review found companies who make cuts and halt all recruiting activities during a slowdown suffer in the long-term.
Field of Talent encourages you to slow down hiring but continue recruiting. Take the wait-and-see approach. The economy could flip and return to a normal growth rate more quickly than expected. Don’t get caught behind the pack.
Emerge from the recession stronger and more prepared. How? Recruiters should use the economic slowdown as an opportunity to:
- Engage your network
- Connect with future candidates
- Build a strong talent pool
If you’re able to bring on short-term or freelance roles, you could secure top talent for the future once you’re ready to extend a full-time offer post-downturn.
Post-recession, you’ll need a strong recruiting strategy and talent pool. Continue recruiting throughout the downturn to guarantee you’re ready and able to reach out to candidates – active and passive – when the time’s right.
Taking your sweet time during recruitment process
Speed is everything to your hiring strategy during a recession. The job market’s top talent lasts far shorter than during a normal economic state. Cut the fluff from your hiring process to make sure you can hire the best available talent quickly when the time comes.
While your time-to-hire is critical, you must also value candidate quality. As you would during any other economy. Job candidates seek a new position for a variety of reasons:
- They were laid off and need a source of income
- Your mission better aligns with their goals
- They need to rejoin the workforce after their spouse was laid off
- They want to progress in their career
Balance speed-to-hire with candidate quality and you have a recipe for hiring success.
As we enter uncertainty, don’t slam on the breaks. Continue recruiting and building your talent pool for when the economy rebounds or your organization is ready to hire again.
Who knows – the economy may not impact your company or industry negatively.
Speed is the name of the game during any state of the economy. When you’re first to extend an offer to a candidate, 96% of candidates accept. That number only increases during a recession.
Field of Talent helps organizations speed up their hiring process by 3x. Looking to make improvements to your candidate experience and guarantee you hire better employees? Get a free consultation here.