This excerpt is from a newsletter of a colleague of mine, Ted Konnerth. We are both members of the International Retained Search Associates. I liked the way Ted approaches this "new reality" and decided to share it. If you need recruiting help in the area of electric industry, Ted and his Company, Egret Consulting would be happy to help you.
According to the September 2014 statistics from the Department of Labor, anyone with a college degree (across all degrees, from Bachelors through PhD) the unemployment rate is 2.9%. 'Some college' or associates degrees, the unemployment rate is 5.4%; which is the same as high school diploma. For less than a high school education, it's 8.4%. Now, when you look at the aggregate numbers of those classifications, there are 87.8 million civilians with some college through full degrees. High school education has 36 million and we have 10.6 million with no high school diploma.
The US unemployment level is now around 5.9%, but the distribution of that number is obviously heavily skewed by education. The unemployment level for college educated; which comprises nearly all management and skilled positions is effectively at full employment. Even the media has moved away from unemployment issues to more topical hysterical issues like Ebola and ISIL. We never seem to read about issues that are actually 'good stuff'; like how education actually drives employment, or how gas prices have dropped and energy independence is actually possible. But fortunately, there is a dark lining in the cloud of employment; that it's hard to find well-qualified people for more technically demanding roles. And well-educated and trained labor is becoming difficult to lure away; relocation has become far more difficult to accommodate and salaries and perks are rising rapidly. The climate of attracting talent has shifted to a seller's market. Is your company adjusting to that reality?
We work throughout the industry and across a broad spectrum of technical functions; from sales to product management, engineering, marketing, operations and senior leadership roles from C-levels to VP. Over 90% of the positions we work on require or strongly prefer a college degree; which means the traditional method of attracting talent by posting positions and waiting for applicants to fill the pipeline is largely dead; well-educated, successful people don't shop at Monster any more. They're busy, they're successful, and they're making money and making a difference to their company. They don't have time to fire up HotJobs or CareerBuilder and review 500 'listings' for open VP positions.
As difficult as this is for our clients; it's really good business for recruiting firms. In fact, the percentage of hires attributed to third party firms (that's us) has DOUBLED since 2011. Job board placements have dropped 25% in that same time and college recruitment efforts have increased 15%. Bench strength is returning as a viable strategy for most of our clients. And then there's the longer term outlook.
So, we've finally arrived at a growth economy after years of endless dreary reports about mortgage defaults, Ponzi schemes, banking excesses, stock market crashes, and ravaged personal finances from protracted unemployment. And now we're faced with a growth economy where finding talent to fuel that growth, is going to get progressively more difficult and expensive. Success can be such a drag.
Here are a few suggestions for finding quality talent:
- Be reasonable. Don't subject them to 15 interviews and weeks of process minutia; reference checks, batteries of tests, delays in communications and then a lateral financial offer.
- Be decisive. Talented people want to go to the next step; become a quality company that isn't afraid of making a decision. Hiring isn't the same as a marriage, make a decision and take some risks.
- Move faster. From start to finish you should be able to meet a candidate and either hire them or cut them loose within 2 weeks. YES, it can be done, even at the most senior levels. Set the goal, map out the steps you think you need to cover and just do it.
- Spend money. This is an investment, with a defined ROI. Calculate the ROI and make a financial decision to pay whatever it takes to attract true quality talent. And yes, this means it'll upset the internal equity of your current compensation plans; there are worse things that can happen to a company than abiding by a compensation plan that is outdated.
- Get help. This is what we do 24/7/365. We've seen excellent hiring practices and we've seen embarrassing hiring practices; we can help and our ROI is excellent. After 15 years of experience exclusively in our industry... we get it and we're open to sharing.
We're all in for a good run... let's enjoy it.