In contrast to last year’s recruitment freezes, furlough, and job losses, the job market has taken an undeniable turn in 2021. With careful optimism, an uptake in vaccination rates and easing restrictions, the confidence to hire is at an all-time high. However, the shortfall in available talent to fuel this newfound optimism while we emerge from the pandemic is creating a job market where the demand for skilled talent outstrips the supply.
What previously unseen recruitment challenges will arise as we adapt to the new world of work in a market led by candidates, and how to overcome them? We have asked our very own Hudson RPO recruitment experts.
What is a candidate-led market?
The hiring demand has soared 145% above pre-pandemic levels in the first months of 2021. In a market like this, candidates feel confident to explore different opportunities, driven by life changes over lockdown, the opportunity of better pay and benefits, remote working, or a lack of progression in their current role.
Although opportunities are opening up left and right as organisations recover, the supply of available talent has not increased as quickly after the pandemic. Strengthened by an online recruitment process requiring less time commitment and investment, candidates successfully engage in multiple interview processes at one time, and more often than not receive multiple offers.
Candidates with multiple offers tend to be more confident to challenge offers they receive, backed by other offers and counteroffers. They are more vocal about their expectations of pay and benefits and weigh up their options carefully to make their decision to accept an offer, sometimes well into the onboarding process.
Particularly skilled candidates in supply chain, engineering (software and power), IT, logistics, sales, recruitment, trade, mechanics, STEM and e-commerce are high in demand.
What does it mean for the recruitment process?
Although the challenges and successes can vary per industry, some recruitment trends are shared across all industries, business sizes, competitive landscapes, and talent requirements. Whether it is early in the interview process, or at offer stage, candidates seem less engaged and see it as less of an issue to trade their opportunity for a better one.
Early 2020 brought about an influx of applications, but it is proving to be harder to get the same number of applications in 2021. Roles that had 200 applications previously, now reach no more than 30. Exceptions to this are applications for home-based working, which gives employers that offer flexibility a real competitive advantage.
With less applications, recruiters are forced to respond with more active sourcing and direct recruitment. But many face the challenge that candidates who did not apply via job adverts, are less engaged in the interview process, and more inclined to abandon the interview process or reject offers.
The interview process
The pandemic has irreversibly changed the recruitment process, and for most it now no longer includes having to take time off work and travel for a face-to-face interview. With less investment in time and relationship, an interview cancellation or no show is only ever one click away.
Many report that if an interview process is too long, and includes too many steps, some candidates disappear without letting anyone know. Moreover, some candidates are not even interested in an interview or screening call before they know what kind of salary and benefits are on the table.
The role of the recruiter in the interview process increases, and candidate experience becomes even more important than it was before. Recruiters are forced to take on a more consulting and soft approach with candidates, and spend more time coaching and advising hiring managers on their hiring needs, the recruitment process and offers. More follow ups are required to keep a candidate engaged, and most interview processes have been shortened and streamlined. Unfortunately, a recruitment process that is too streamlined required even less commitment from a candidate and brings the risk of being easy leverage to raise other offers.
Making the offer
Certainly, the most reported challenge is the rejection of offers, sometimes even while candidates have started the onboarding process. The main reason for rejected offers are counteroffers, either by competitors, or their previous company. In a tight market, organisations are happy to raise a counteroffer, as etering a recruitment process is more expensive and difficult than keeping an existing employee. Retention bonuses have also become more common.
Candidates can be involved in the final stages of a long, multi-step interview process for a senior position that requires a larger investment of their time, and still reject an offer. But even if a candidate is not currently in work, there is still less on the line in rejecting an offer even after having started, as the next opportunity is just around the corner.
Not only does the candidate driven market bring more confidence to keep options open, but candidates also look at an offer from a more holistic point of view. Pay is not the only factor they consider, they also look for sign-on incentives, car allowances, promotion trajectories, holiday packages, permanent contracts, flexibility and remote working and are more vocal about this too.
Unfortunately, many of the familiar benefits organisations offer, do not match what candidates are looking for. Relocation packages have lost their attraction when candidates know that their job can be done from anywhere, insurance and benefits packages are less interesting to the younger generation to whom lifestyle focused benefits such as gym memberships, counselling, and cycle to work schemes are more appealing. Unsurprisingly, the most attractive benefit is the ability to work remotely, hybrid, or on a fly-in fly-out schedule.
How can organisations recruit successfully and efficiently in a candidate-led market?
We have spoken to the Hudson RPO specialist recruiters and talent advisors across many of our accounts to ask them how they have successfully responded to the changes in the candidate led market.
Analyse where improvements are needed
Start by identifying where and how changes can be made. Analysis behind job advertisements such as AB testing, monitoring the length of the recruitment process and at what stage candidates drop out, survey competitors and review if the benefits you offer aligned to your target audience.
Explore alternative ways of sourcing talent
As sourcing becomes more difficult and is a time heavy investment for little response, employee referral schemes, social media, and local networks become more interesting and offer more opportunities for truly engaged candidates that fit the organisation.
Improve the employer brand
Because more applicants that actively applied for a position tend to be more engaged throughout the interview process, it is no longer about finding the talent, but about making sure they know about an employer and are interested enough to apply. This is where a strong employer brand is of great importance and competitive advantage. To read more about employer branding, click here.
Explore where you can adapt your needs to the market
When a particular role or skill is hard to fill, consider if your investment in the recruitment process would be better off being an investment in training and development. Not every candidate can tick all the boxes right away, by investing in training and development you are also making an investment in a long-term employee that contributes to your organisation.
Do you recognise any of the challenges described? Contact us today for advice, or learn more about how recruitment has adapted after COVID-19 in our most recent podcast with our client, LV=, or in our latest whitepaper with Future Talent.
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