There’s no other way to describe it. The current market for talent continues to be an active one with new job requisitions developing at a brisk pace. While financial markets have helped facilitate that to some degree, firms continue to evolve their businesses into new areas, upgrade their infrastructure, and build their benches. While normally this would be viewed as the ideal hiring environment, a general malaise remains pervasive in the marketplace as far as candidate interest in exploring new career opportunities. We’d argue that the mismatch in interest level and expectations between buyers (hiring firms) and sellers (job-seeking candidates) has perhaps never been wider. While some are quick to point to the “Great Resignation” as a potential catalyst for the lackluster hiring market, we have identified other key factors that help explain why a misalignment has occurred and what strategies can be taken to offset it.
The job market over the last year has clearly favored sellers, providing candidates with what could be viewed as a stronger position of negotiating leverage than ever before given the unprecedented market backdrop. Throughout numerous interviews, our team has increasingly heard a consensus view shared by potential job candidates that they are making the most of their current role, viewing it as “good enough for now” as a result of the ongoing pandemic. When asked to go a layer deeper as far as career next steps/aspirations, candidates often acknowledge that they don’t see themselves with the same firm over the long-term, whether because of unhappiness with role, corporate culture, or for other reasons. With most companies still offering their employees a full or partial remote work option for now, it’s hard to argue that employees lack work/life balance. Second, companies have also gotten aggressive in their employee retention efforts, many of them awarding base salary increases (anecdotally in the 10 to 15% range most often), offering promotions, or retention bonuses to keep people happily engaged in their roles. Against this backdrop, there is a general aversion to taking on any potential risk as far as exploring new career opportunities. Relocating for jobs has also increasingly become a nonstarter which makes positions outside of major metropolitan areas particularly difficult to source deep candidate pools for. Where there is an appetite to explore new roles, some job seekers’ expectations have become what could be considered as unreasonable. Most often, this happens on two fronts:
- Remote work: candidates have decided that they will only entertain a fully remote work option on a permanent basis with no interest in returning to an office environment given the success that remote work structures have proven out the pandemic (typically requested by candidates with less than 10 years of experience)
- Compensation expectations: with most employers forbidden from asking compensation histories of potential employees, job seekers have become increasingly bold in their ask as far as compensation expectations for a new role, some seeking pay raises of 30% to 50% despite already having seen considerable increases in pay over the last two years.
Needless to say, an environment where i) candidates aren’t compelled to pursue a new role, ii) have little interest in going into an office or relocating for an opportunity, and iii) require a huge premium to do so presents considerable challenges for hiring managers that have a growing need for new talent and building out teams. Another relevant factor is that firms have gotten more creative as far as new role design, hoping to accomplish more with less, creating multi-faceted positions that would have historically encompassed two to three employees. While taking on a broader role could certainly make it more attractive, it can also create a narrower pool in terms of identifying the ideal “unicorn” candidate who checks all of the boxes.
With all of these competing forces evident, it is important for hiring managers to exert greater flexibility in their approach to the recruiting process. Our suggestion is to ask yourself if you have confidence that the person being interviewed a) checks most of the boxes for the role, b) can successfully grow into the other areas they may not be as deep in, and c) will be a good cultural fit with the team and be entrepreneurial. If so, then they deserve serious consideration. Regardless, there is a need to act quickly and decisively in vetting potential candidates as the market continues to be a quick one. One other point that we would raise is around firms’ desire to have an increasing amount of interviewers involved in the process due to the virtual nature of interviewing in today’s marketplace. While a good practice generally, we have also seen that aspect backfire in multiple cases where inviting additional interviewers led to inconsistency in messaging as far as how the role was described or inability to act quickly on moving candidates forward. This can, unfortunately, derail an otherwise well-designed process even at the later stages, so companies need to be selective as far as their interviewers slate to ensure there is consistency in messaging for how the role is described by the group.
Our hope is that as 2022 continues, the divergence in expectations between hiring firms and potential job seekers narrows as we exit the pandemic and people feel more compelled to weigh their potential career options, finding themselves more open to exploring new opportunities. For those individuals who may be considering a move, there is no time like the present as things are unlikely to get much better.
