The economy is hanging in a gray area. For the first time in two years, there has been a decline in job postings and an increase in applications. Despite continued robust job growth in the U.S., certain sectors are struggling. Massive layoffs in the tech industry, especially at companies that were previously on a fast growth track, indicate traces of a sluggish economy.
What does this mean for talent acquisition departments?
For one, it means that there’s no reason to panic. Regardless of market conditions, companies will always need to hire and manage talent. But recruiters do need to adjust their hiring strategy to move swiftly with the ebb and flow of the economy. Instead of competing to fill as many positions as possible, smart recruiters know that a slowdown is an opportunity to find candidates who are an optimal fit, improve company culture, and level up hiring processes and technology stacks.
When hiring slows down, here’s how to make your recruitment strategy more resilient.
Be Selective, Move Fast
The good news is economic slowdowns can often create larger pools of talent. When more candidates apply for your job listings, it behooves recruiters to be more selective.
That said, you can’t drag your feet when you find a qualified candidate. Even when the economy is in flux, there will still be some competition for top talent. The best, most in-demand candidates will likely accept compelling offers quickly, as nobody wants to be left unemployed when the economy enters challenging territory.
Be ready to send an offer once all the internal stakeholders have responded positively to a candidate; you don’t want to miss out on a qualified applicant by letting a competitor beat you to the chase. Although we’ve all lived through periods when open positions languished for too long, that may soon change with the economy, especially in technology.
Improve Company Culture
An economic and hiring slowdown presents a tremendous opportunity to rethink or double-down on company culture in ways that you didn’t have the time or energy for in the past. If you experience a lull in hiring, use that time to explore your company values. For instance, you can poll your employees, find out what makes them happy at work, then shape your company policies around their top values.
Cementing strong company values will also aid in recruiting and interviewing. With clear aspirations for your company culture, you can begin to evaluate candidates in a more nuanced way that considers whether or not a true two-way culture fit exists.
A valuable side effect of taking steps to improve your company culture is employee satisfaction and retention. During a recession, holding on to your talent is a critical advantage; the last thing you want is to lose top-performing employees while the market is wavering.
Ramp Up Internal Hiring
Another aspect of managing talent during a slowdown is becoming more efficient with resources. The first and healthiest way to exert damage control is to shift resources from nonessential functions to those that are crucial for the company to operate.
Focus on tapping into your existing workforce to handle the most urgent and important tasks before doing any external hiring. Loyal employees who already know your company inside-out are often your strongest choices. Not to mention, it can harm morale if your organization goes through layoffs only to hire externally for essential roles.
Studies show that giving existing employees new opportunities to advance their careers within the company can reduce recruiting, hiring, and training costs while boosting employee loyalty and commitment. In fact, external hires cost 18% to 20% more than those promoted from within and deliver significantly lower performance for the first two years.
Revitalize Your Hiring Process
When the economy operates at full throttle, there’s barely enough time for TA to handle the day-to-day tasks. That’s why an economic slowdown can be a blessing in disguise, a pause to reassess, revitalize, and experiment with your tech stack and hiring processes.
Start by asking strategic questions that you wouldn’t usually have time for during a busy season:
- What are some bottlenecks in your hiring process?
- How effective are your DEI initiatives, if you have them?
- How do you structure your interviews? Do they capture the data you need to make informed decisions?
- Are you screening, interviewing, and selecting candidates in an unbiased way with that data in mind?
Additionally, making time for employee training around new tech tools and processes is also essential. With new productivity tools at their fingertips, your recruiters will be able to automate certain processes and take on more responsibility when the demand for hiring ramps up again.
Ultimately, while an economic and hiring slowdown can present recruiting and talent management challenges, it does not have to be negative for your organization. By taking time to evaluate, improve, and implement new solutions that modernize and streamline your processes, you can strengthen your position all around and take an extra beat to make sure each open position is filled by the right candidates — and be better prepared when the next wave of growth arrives.