Posted by Paul McDonald on Friday, October 2, 2015 - 07:56 | Follow me
Today’s jobs report from the Bureau of Labor Statistics (BLS) was disappointing. U.S. employers added just 142,000 jobs in September, lower than most analysts had been expecting. In addition, combined job gains for July and August were 59,000 less than previously reported.
The jobs report did contain some bright spots, however. The healthcare industry added 34,000 jobs in September; this gain is in line with the average increase of 38,000 jobs per month for that sector over the past 12 months. Employment in professional and business services grew by 31,000 jobs. Employment in information increased by 12,000 in September.
The overall unemployment rate was 5.1 percent, unchanged from August, which was the lowest since 2008. The unemployment rate for college-degreed workers 25 and older — those in greatest demand — held steady at 2.5 percent, according to the BLS.
The slow-but-steady recovery
Despite today’s lackluster news, we’ve seen solid, but not spectacular, job growth throughout the year. That’s the way this recovery has been. Monthly job gains have exceeded 300,000 jobs just three times since January 2014 but haven’t dipped below 100,000 jobs since June 2012.
When the data are looked at cumulatively, it’s clear the job market has been doing very well since the end of the Great Recession. According to jobs report data, the U.S. economy has created nearly 1.8 million jobs so far this year and about 4.9 million over the past two years.
The BLS’s most recent Job Openings and Labor Turnover Summary (JOLTS) report tells the same story. Job openings in the United States rose to 5.8 million in July. That’s the highest number since the BLS began publishing the JOLTS report in December 2000 and twice the number of openings we saw during the downturn.
Putting your old hiring strategy aside
As I talk to hiring managers and Robert Half staffing experts around the country, though, I get the sense that many hiring managers are still complacent and relying on bad recruiting habits they fell into during the recession.
Then, it was relatively easy to find good people because the market was flooded with job seekers. Hiring managers simply didn’t have to work as hard to staff vacant roles. In fact, the number of job seekers per job opening rose as high as 6.8 in July 2009. Today, that ratio is down to 1.4, according to the BLS. So, we’ve gone from almost seven available people for every open job to less than 1.5.
The jobs data are clear: There are few professionals looking for employment today and many companies looking to hire. And it’s time to put your old hiring strategy aside.
A better approach to hiring
The simple truth is that employers now need to work harder to find good people. Job seekers know they are in the driver’s seat. I’ve made the point before that today’s job market is like the housing market: The best candidates secure multiple offers within days. Firms that drag their feet in making a hiring decision or seem too selective are losing out, and they will continue to do so.
A traditional hiring strategy isn’t going to cut it. Instead, you need a well thought-out, multipronged approach to recruiting that includes the following six elements:
- Competitive compensation — Paying well is perhaps the most important element of any successful hiring strategy. According to research for our newly released Salary Guides, U.S. starting salaries for professional occupations are expected to increase an average of 4.1 percent next year. Now is a good time to confirm that the hiring budget you’ve planned for 2016 will be adequate — and that what you’re paying your current employees is in line with industry standards. Today’s job seekers know what they’re worth and aren’t afraid to hold out for a compelling offer. (Be sure to download a free copy of the Salary Guide for your industry to help benchmark your organization’s salaries.)
- Compelling benefits — Our latest Salary Guide research also shows that employers are offering more flexibility, perks and bonuses to attract and retain staff. Not sure what to include in your benefits package? Ask your employees which perks they value most. You’ll likely find many traditional benefits — like healthcare coverage and retirement plans — remain strong favorites. Programs that promote work-life balance are also highly valued by most professionals today.
- Hiring from within — Not every opening needs to be staffed with someone from the outside. You may find that the best person to take on a vacant role is already on your team. Hiring from within usually takes less time than launching an external candidate search, and the adjustment period can be shorter because the person is familiar with your corporate culture, policies and people. Promoting deserving staff also sends a great retention message by showing people there are defined career paths within your organization.
- A ‘why we are different’ story — Every element of your hiring strategy — from your website to your job postings to your interactions with potential hires — should give candidates some sense of what makes your business and corporate culture special. Here, again, your employees can provide valuable insight. Ask them, “What do you like about working here? What do you think makes our company stand out?” (Note: This conversation also provides a great opportunity to gauge whether your employees are content and determine if you need to make changes to ensure you retain valued staff.)
- An employee referral program — Your people know people — including potential hires. So, if you don’t have one already, consider establishing a formal employee referral program with clear rewards to incentivize your workers to help find good people. If you have one in place, is it working? Talk to your HR team to determine how many candidates are coming through that channel and if changes — a larger cash bonus for successful referrals, for example — would make it more effective.
- A ‘comeback culture’ — In a previous post, I emphasized the importance of keeping the door open to people who leave the organization on good terms to explore a new path, but decide later that they would like to return. While not every valued employee who moves on will turn out to be a “boomerang employee,” there’s a chance some will seriously consider the opportunity if they know they’re truly welcome to make a comeback at your firm.
Calling in the experts
Lastly, keep in mind that strong allies can make all the difference in helping you find good people. So, in addition to enlisting help from your employees, and relying on your own network for leads, you might want to consider working with a specialized recruiting firm.
Recruiters can help you cover more ground in your search for the right candidate and shorten the time it takes your business to staff open roles. They also may know of passive job seekers waiting for the right opportunity to make a move. Having the ability to connect with “under the radar” candidates is a great way to upgrade your hiring strategy and a clear advantage for your business in today’s competitive landscape.