How Full Employment Impacts Hiring
When everyone who wants to work has a job, that’s known as full employment. In the long term, the economy is always moving towards or receding away from full employment as companies add and subtract positions, and new people enter or return to the job market. In the past few years, the economy has edged the closest it’s been to full employment in almost two decades. In May, the unemployment rate dropped to 3.9 percent, its lowest level since 2000.1
Full employment is cause to celebrate in many ways. But while full employment indicates a robust economy, it also causes unique challenges for hiring managers in need of skilled employees for critical roles. Here’s a primer on the recruiting issues raised by full employment, and how to solve them:
- Fewer skilled candidates in the job market;
- Increased competition for those candidates; and
- Lower employee retention rates.
When the economy is at or near full employment, hiring managers and recruiters are faced with a tight labor market. With the majority of skilled talent already employed, the competition for existing job seekers is fierce. It also means many people who are currently employed have their radar up for better opportunities. As a result, businesses are left with a greater number of open positions just when it is most difficult to fill any role.
Here are some key strategies to compete for skilled talent, and retain the talent you already have:
Create a Seamless Hiring Process
Today’s job seekers are tech savvy. They don’t want to jump through complicated hiring hoops and navigate an opaque process. A 2016 Candidate Behavior survey by CareerBuilder found one in ten millennial candidates said they’d bypass a company without a mobile-friendly application. Additionally, 75 percent of candidate respondents to the survey said they wanted to know how long the hiring process would take, and one in five said they didn’t want to spend more than 20 minutes on an application. This isn’t to say they don’t want to put in the effort to land a new position. It’s rather they recognize when would-be employers are respectful of their time, and conscientious of their experience through the hiring process—and when they are not. To draw top talent, you should always be attentive to the candidate experience, but it’s particularly important in a tight hiring market.
A convoluted or slow hiring process also increases the risk skilled talent will take positions at organizations that are hiring at a faster clip.
Consider the following strategies to streamline your hiring:
Define the Job – Clarify the must-have skills for any role and include them in your job description. This minimizes the number of applicants who don’t meet these requirements.
Assess Candidates Early – Skills assessments and background checks should occur early in the process, so only qualified candidates make it further through the hiring funnel.
Embrace Social Media Recruiting – If your hiring strategy is not mobile and social-media friendly, you are missing out on the growing number of candidates who job search via their phones social networks. This is particularly important when seeking to attract younger talent.
Create a Workforce Strategy
Most companies take a reactive approach to hiring when positions open up, but this can result in costly bad hires and even over-hiring. Defining your company’s workforce strategy can prevent reactive hiring, by establishing a master plan for recruiting that takes into account expected and unexpected shifts in employment needs. Strategic workforce plans look different for every organization, but creating them usually involves:
- Taking a snapshot of your current workforce, so you know if and where there are critical skills gaps.
- Determining the employee headcount and skills required to meet future business objectives.
- Creating a timeline for filling critical roles.
- Assessing how well your organization is meeting hiring goals.
- Establishing accountability for meeting hiring targets.
If you discover your company’s hiring needs fluctuate frequently, leveraging contingent labor can reduce hiring costs and ensure roles are filled quickly.
Fine-tune Your Employer Brand
Today’s candidates do their research. This means they are exploring your company’s LinkedIn, Glassdoor, and careers pages before they hit the ‘Apply Now’ button. No matter the size of the company, it’s important to establish an online presence that gives an authentic, behind-the-scenes look at what it’s like to work there. This improves the chances top talent will apply to your organization. It also improves the likelihood candidates who apply would be a good fit for your organization, because they’ve already gotten a feel for a ‘day-in-the-life’ of your workplace.
All too often, companies hire excellent employees and then drop the ball during the onboarding process. Regardless of your new hire’s skill or experience level, starting a new job is stressful. People lose faith in companies that compound that stress by leaving them to ‘wing it’ in the early days of the job. A consistent onboarding program improves the chances direct hires will commit to your organization for the long haul, and that skilled contingent workers will consider returning in the future. Here are the must-have elements of effective onboarding:
- Introductions – Even if a new employee received a tour during the interview process, take them around the workplace again on their first day. Introduce them to the people they are working with, and clarify who they should turn to if they have any questions or concerns. If possible, gather key coworkers for an informal break with coffee and snacks on their first day. People are much more successful in new jobs when they feel connected with their coworkers.
- Tools – Make sure every new hire has a workspace and all the tools they need to begin work. This includes login information for computers and providing safety equipment, if needed.
- Training – Begin training on the first day, prioritizing introductions to the most important tasks. This could mean a tutorial on the office collaboration tool for an administrative position, or technical training for a manufacturing role.
- Communication – Check in with your new hires often in the weeks and months after their start date. Ask them questions about how they are adjusting to the position and anything that would improve their experience. If there are problems, take action immediately. This shows them you care about their experience, and improves engagement.
While the increased competition for skilled talent that coincides with full employment is no doubt challenging, it’s helpful to view it as an opportunity. By improving your hiring strategy and employment brand to meet the demands of tight labor market, you’ll create an agile workforce that is robust enough to weather any market.
Need help with your hiring strategy? Contact LINK Staffing.
1. Chappell, Bill. “U.S. Unemployment Drops to 3.9 Percent — Lowest Since 2000.” NPR. Web. 4 May 2018.