Archives for June 2021

9 Trends for the US market in 2021

9 Trends for the US market in 2021

Content Team

With the eventful first months of 2021 behind us, the world of work carefully starts to emerge from the pandemic. What methods will be left behind as we reopen and what are the lessons we bring forward into the rest of 2021? We have identified 9 trends in the US market that will impact decision making across organizations in the US.

As the US economy emerges from the pandemic, the US GDP is estimated to grow by 8%. A contrast to the 2-3% average we have seen in the last 15 years. Predicting progress and optimism merely a year after a labor-market catastrophe might seem early, but the US is setting the example of how rapidly jobs can return against the backdrop of increasing vaccination rates.

highway in city at night
2021 will see a competitive market for talent, driving hiring costs, the importance of employer branding and technological advancements

In the early spring of 2020, the unemployment rate in the US came close to 15%. Today, it is standing at 6%. Even in Europe, currently combatting a third wave of infections, the labor market is beating forecasts as the economy starts to adapt to our new way of life and virus-containment measures. Moreover, the public perceptions of how easy it is to find a job have reached levels that previously took over a decade to recover after the financial crisis.

1. Competing for talent

The projected growth, the recovered confidence and a carefully optimistic market are likely to lead to a previously unseen competition for talent. Recruiters are likely to notice this trend first, particularly in blue-collar jobs and shift worker positions. A continued rise in demand for delivery service workers, the return of retail, hospitality, restaurants and supply chains benefiting from unspent lockdown savings and stimulus checks are all competing for the same pool of talent.

The first response to a competitive race for talent is an increase in wages to attract people into an organization. While some companies manage to respond with one-off incentives such as sign-on bonuses, others have no choice but to raise their remuneration. On average, workers who switch jobs can now expect a 13% pay rise, while many employers are paying their existing employees 4 to 7% more than they did a year ago.

Despite the willingness to pay more, nearly half of all American businesses have reported finding it challenging to fill vacancies. Whether there is a reluctance to return to work because of feared health risks or generous unemployment insurances, salaries may have further to rise in 2021.

2. Increasing hiring costs

Regardless of industry and market, business leaders can expect an increase in hiring costs following the soaring competition for talent. Increasing hiring costs entails more than needing to make more expensive offers to candidates to compete. It can also be attributed to the conversion rates of job advertisements in times when job supply outweighs job demand, causing talent to look at more job advertisements while applying to less. This, in its turn, means lower conversion rates, higher costs per click and more expensive advert placements. As a result, LinkedIn, ZipRecruiter and Indeed will become more expensive, and the cost per applicant for an organization is projected to rise as far as 10-30%.

3. Continued importance of employer branding

One way in which an organization can respond to increasing wages and costs is to make sure it positions itself as the employer of choice within its market or industry. Leaders in the recruitment industry agree that employer branding has a significant impact on hiring and will continue to be an increasing area of focus. More than 90% of candidates seek out at least one resource to evaluate an employer’s brand before applying.

several people in meeting
1 in 5 Americans have left a job due to poor company culture.

Employer branding can help reduce costs per hire and time to fill in a competitive talent market while improving engagement and employee retention. The pandemic has shifted the mindset of many employees and applicants, causing organizations to have to answer questions about wellbeing, their handling of the pandemic, diversity & inclusion goals, stance on societal issues and flexible working options.

A strong employer brand starts internally by nurturing an organization’s internal culture. In a year of uncertainty and social unrest, one in five Americans have left a job due to poor company culture. 77% of applicants consider a company’s culture before applying and more than half of them consider the culture more important than salary when it comes to job satisfaction. Find out more about employer branding and how it can support your recruitment process here.

4. A strategic drive towards DE&I

With company culture, Diversity, Equity and Inclusion (DE&I) are key and will be a continuing area of focus for organizations in the US. Applicants are making decisions based on their assessment of an organization’s commitment to DE&I, as 70% of them have reported wanting to work for a company that demonstrates this.

Against the backdrop of 2020’s social movements, an increasing number of North American companies and executives in the US use or are considering using DE&I metrics in their incentive plans to drive and measure progress towards their goals. Click here to read how DE&I metrics can help your strategy.

The role of the recruiter in attaining these goals will grow. Not only are they the first point of entry for diverse candidates, but they also advise hiring managers they support, build diverse interview panels and drive data-driven reporting against diversity goals.

Additionally, organizations will invest in the right recruitment tools to help build diverse teams. One of these latest tools is the programmatic job ad: buying, placing, and optimising a job advertisement by software rather than people. A software-only approach prevents people from bringing their own beliefs of preferences into the hiring process or the placement of their advertisements. So far, programmatic job advertisements have shown 23% more candidates from underrepresented groups and 7% more women than the US online benchmark.

Tampa Florida downtown
Hudson RPO has recently opened a new office in Tampa to facilitate the growth of our team of experts in the US.

5. Focus on wellbeing

Apart from a commitment to DE&I, applicants also look for employers who recognize the need for a work environment that prioritizes wellbeing. Over the pandemic, the mental health conversation in hiring became more common. In 2020, organizations increased wellbeing offerings and increased internal communications and social interactions to prevent a social disconnect.

Many organizations in the US are currently making the shift to a holistic view on wellbeing rather than focusing on cost reduction, resources and insurance costs alone. Especially the younger generation that is about to enter the workforce is aware of societal issues and has the drive to be part of solutions. Happiness at work being limited to the time spent in the office is over as work-life balance changes with remote working. Wellbeing is increasingly considered to be the opportunity to give back, having a clear purpose and mission as drivers for inspiration and energy at work.

6. Internal mobility

Since the start of the pandemic, internal mobility has increased by nearly 20%. Companies will continue to catalogue employees’ current skills and tie internal opportunities to relevant L&D sources that will help employees fill any qualification gaps. Internal mobility programs can lower recruitment budgets, but when done right also increase budgets for learning, development and resources. This can change the role of the recruitment function, aligned it more closely to HR to lead and build internal mobility programs and development initiatives.

Another change for recruitment is the way they assess potential candidates. With more internal mobility opportunities, many organizations will move away from static roles in departments and shift to agile project-based and cross-functional structures, allowing employees to shift to new projects if business needs change. With this, an applicant’s potential and transferable skills like adaptability and problem-solving increase in importance and benefit an organization. According to a LinkedIn survey of over 1500 talent professionals, the number 1 skill for recruiters to embrace in 2021 is adaptability.

7. Leadership changes

With an increased focus on internal mobility, wellbeing, DE&I, comes a change in leadership styles. Alongside the debilitating effects on work-life balance, the pandemic has taught us that flexibility and empathy are essential for employee retention. More than ever, board rooms have focused on mental, physical, financial and emotional health in relation to work performance.

Regardless of industry, soft skills are growing in value. Talent that can lead to change and work and manage a team with flexibility and adaptability is valuable to an organization in unpredictable times. As a result, applicants with technical knowledge combined with management, leadership and project management are overtaking others in demand.

person presenting in a meeting
The millennial generation is getting ready for leadership positions.

Taking center stage in this change in leadership is the millennial generation, who are now ready to take on management positions as the baby boomers begin to enter retirement. Millennials bring digital knowledge and experience, but simultaneously exhibit a practical understanding of how to apply their knowledge to bring about change. Currently, 91% of millennials say they seek leadership roles and 83% of them would prefer to work in an organization with fewer managerial layers.

8. Social media newcomers

Even before the pandemic, the use of social media in recruitment was common practice. Almost 85% of American companies say they use it with success. However, the realm of social media changes quickly, as do the platforms that recruitment functions need to adapt to. Soon, advertising on LinkedIn may no longer be enough.

The world of social media is moving away from the traditional resume and shifting towards a more creative and personal way of pitching one’s work experience. For example, the video platform TikTok is now testing a tool that can help brands recruit new employees. The tool is mainly targeted towards the Gen-Z audience, allowing them to post a TikTok video resume that can look much like an elevator pitch of work experience summary.

This is not the only way in which TikTok is transforming the applicant experience. GenZ’ers also use TikTok to share career advice in short videos, ranging from application advice to interview tips and negotiation skills. The hashtag #careeradvice gained momentum in the first half of 2021, totaling more than 80 million views.

Another newcomer is the platform Clubhouse, an invitation-only social networking app that aligns well with the increasing interest in audio content such as podcasts and webinars. Clubhouse allows users to get together in moderated rooms to listen to selected speakers, live and unrecorded.

Clubhouse is rumored to be a trend to keep an eye on for the business-to-business industry and a new way to source candidates based on their profile, contributions, and attendance in Clubhouse, for example, in exclusive business events or live virtual recruitment fairs.

9. Technology

For the remainder of 2021, organizations will have to adjust their sourcing and hiring methods to stay viable in a competitive market, meaning investments in technology and automation. For example, traditional hiring processes can be upgraded by applying programmatic job advertisements, predictive analysis, automatization of processes like DocuSign and applicant tracker systems (ATS).

AI-powered chatbots are also becoming commonplace as organizations start to use them for the first phases of applicant screening and look for ways to make the application process easier to improve the candidate experience. Many applications are submitted through mobile devices, a 20% increase from 2019 to 2020.

woman studying something on monitor
Natural language processing and artificial intelligence will transform HR and hiring practices.

Related to AI is Natural Language Processing (NLP), referring to the ability of software to understand spoken and written language. NLP can help identify candidates quickly, without the need for lengthy manual screening processes. NLP also has the potential to be combined with voice recognition to facilitate faster review and analysis of job interviews and equip chatbots with personalized responses.

In an everchanging and competitive landscape, an RPO partner can help your business navigate and advise your best route to market to find your most important asset – people. If you have any questions or would like to find out more, get in touch.

Hudson RPO

Content Team

The Hudson RPO Content Team is made up of experts within the Talent Acquisition industry across the Americas, EMEA and APAC regions. They provide educational and critical business insights in the form of research reports, articles, news, videos, podcasts, and more. The team ensures high-quality content that helps all readers make talent decisions with confidence.

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8 Procurement questions for RPO evaluation answered

8 Procurement questions for RPO evaluation answered

Content Team

Are you considering an RPO to help your organisation meet its strategic recruitment goals?

Outsourcing the recruitment function is a major strategic consideration that will help you identify and secure your company’s greatest asset – its people. The below 8 questions can be helpful during the procurement evaluation process of an RPO partner, offering a valuable baseline for decision making.

1. Does outsourcing the recruitment function or process align well with your business needs and strategy?

One of the main benefits of RPO solutions is that you can scale the support you require from an RPO up or down depending on your hiring needs. Hudson RPO can work with on-site and off-site recruiters that will form part of and integrate into your existing teams and processes.

2. Will recruitment process outsourcing truly improve your business performance?

From talking with our clients around the world, we have identified the top 4 ways our clients have improved their business performance:

Cost reduction
Working with an RPO partner significantly decreases the average cost-per-hire, often by more than 50 percent. A tailored RPO solution supplements hiring and helps you drive quality, efficiency, and reduced costs and time to hire.

Ability to flex and scale
An RPO solution allows your organization to flex talent acquisition headcount up and down as hiring needs change. Measuring and tracking performance through regular reporting, alongside talent data that is easily translated to insights, you will increase efficiencies, identify improvements, and better forecast future hiring needs.

Quality of hire
Many clients are in a niche sector and need scarce skill sets. Leveraging formerly untapped sourcing channels, to access additional candidates is one of many benefits of outsourcing recruitment. Hudson RPO is experienced in candidate sourcing and has a range of bilingual talent sourcers available to meet client’s needs anytime, anywhere. While helping one of our clients in rural Canada find their niche talent, we reduced their agency fees by 25%, and accomplished an annual cost saving of $60,000.00 USD.

Enhanced employer brand
Utilizing Hudson RPO’s experienced recruiters as an extension of your team provides accessibility to deep candidate networks and reduces time to engage those candidates. Hudson RPO can also include employer branding into your tailored solution to help you further improve your employer brand. As well as creating a better candidate experience, a strong employer brand makes your organisation more attractive to candidates and positions you as the employer of choice in your market or industry.

woman presenting at meeting
Outsourcing your recruitment can help you identify and secure your company’s greatest assets – its people.

3. How can you understand and control costs?

It is important to understand the entire pricing structure, and how the package of products, services and management fees may be bundled together. Through insights and regular reporting from Hudson RPO, it will be easy to understand how the investment you make contributes to your recruitment process, what improvements are needed, and what needs to be forecasted for the future.

Cost reduction through shared risk.
When a business downturn hits and recruiting needs suddenly drop, so does a company’s need for recruiting staff. Likewise, when the business is expanding into another product category or region of the world, recruiting needs may suddenly spike.

Outsourcing the recruitment function allows a company to pass along the cost risk of those resources to the business partner. Recruitment outsourcing partners accept the responsibility of efficiently adjusting resource levels when hiring fluctuations happen. As a result, the client does not bear the burden of carrying unnecessary staff.

Similarly, the client faces a lesser chance of being short-staffed when greater resources are required.

Faster time to hire.
Time is money and hiring new professional level employees takes a lot of both. From identifying candidates, to conducting interviews and negotiating offers, acquiring a new employee taxes your internal resources.

Plus, each day a job requisition remains unfilled, your business loses the benefit of that employee’s contribution. Recruiting and budgetary resources are pulled away from other high-value initiatives.

Outsourcing all or part of your internal recruitment function can dramatically reduce your time to hire.

Streamlined recruitment processes.
One of the most common problems we see with the recruitment life cycle is that it’s a disjointed and uncoordinated multitude of practices—good and bad—across organizational functions, departments, divisions and regions.

Often, this causes overlap in media buying, training, and on-boarding procedures. It leads to poorer hiring decisions and higher operational costs.

Piloting an RPO project gives you the opportunity to rethink these processes. The RPO vendor will help examine your recruitment process workflows to determine where overlap, excessive cost, and inefficient practices may exist.

Then, an outsourced model can be custom designed, providing you with service levels and success metrics that exceed the status quo. These practices yield increased efficiency and satisfaction with the recruitment life cycle, resulting in overall cost reduction for your company.

several team members around table
An RPO vendor can help examine your recruitment process workflows

4. Are the financial projections accurate?

It is important for you to take a critical look at any numbers submitted by the RPO provider. Look for assumptions, oversimplifications or just plain misleading figures that may adversely impact your overall cost/fees. It is a good idea to ask for case studies or client testimonials. 

5. Will this arrangement still enable you to have the necessary internal human resource skills and expertise needed in any organization?

While outsourcing may be the right direction for your recruitment function, there is still a need for internal expertise to help evaluate chosen strategies and tactics, and coordinate with the RPO provider.

It is essential for RPO providers to understand a company’s historical recruitment needs, the objectives and priorities of stakeholders and the broader HR and business agenda. This data will be the basis for setting correct SLA and KPI benchmarks, which are essential for the management of business expectations and getting the partnership off on a strong foundation.

Your business partner should also be open to transferring all knowledge and turning back over the people and processes to your internal team once a best-practice operation is established and running smoothly.

6. Who will ultimately manage the financial and performance metrics of the contract?

People, processes and technology combine to deliver an RPO solution. It is essential that the company’s internal leadership maintain oversight of any outsourcing initiative. Factoring into the contract terms the time and resources necessary to effectively manage the relationship and its results is smart.

7. What are the cultural ramifications of outsourcing your recruitment function?

Understanding how your managers and broader employee base are going to react to this massive operational change is critical. One essential competency to look for in your RPO business partner is change management expertise. Hudson RPO has knowledge of the potential pitfalls and know ways to ensure organizational support and buy in.

Our client Astrazeneca selected Hudson RPO for our scalabilty, cultural alignment, and experience in pharmaceutical recruitment. The solution for Astrazeneca includes all permanent and fixed term hiring. To set the team up for success, we implemented a change management program to get hiring managers on board in the process.

8. Is there an escape clause in the deal or protection in place for when business conditions change?

As we have seen during the recent recession, business conditions can change in a major way, and fast. You need to make sure you are not locked into a long-term contract or deal with little or no flexibility to alter scope or completely withdraw over time. Here again, making sure that there is a shared risk model for operational costs when hiring demands change is one way to help ensure some of this protection. You could consider an on-demand recruitment solution, getting your company expert support for sudden or challenging hiring requirements for a specified period.

If you have any questions not mentioned above, or would like to speak to a talent expert, please get in touch.

Hudson RPO

Content Team

The Hudson RPO Content Team is made up of experts within the Talent Acquisition industry across the Americas, EMEA and APAC regions. They provide educational and critical business insights in the form of research reports, articles, news, videos, podcasts, and more. The team ensures high-quality content that helps all readers make talent decisions with confidence.

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