Anyone trying to hire right now won't be surprised by the Greenhouse Hiring Manager Sentiment Report, released Thursday, which surveyed over 1,500 hiring managers and C-suite executives, about the job market. The results: They’re underwater.
In March, the country added 431,000 jobs, bringing the unemployment rate to 3.6%, the lowest since the pandemic began. Applications for unemployment benefits have dropped to near their lowest point since 1969, Fortune reported. This is despite inflation surge, supply chain bottlenecks, the ongoing effects of the COVID-19 pandemic, and a war raging in Eastern Europe.
A staggering 75% of respondents expect hiring to become an even bigger challenge for the rest of the year, and more than four in five (84%) say they’re burned out. Three-quarters of hiring managers believe candidates are only becoming more demanding when it comes to perks and benefits, which leaves their companies scrambling to level up.
Hiring managers’ top concerns, according to the survey, are their ability to source the right talent, losing candidates to better offers at competing companies, and a generally unstructured and ineffective hiring process.
When it comes to recruiting, they said their companies are struggling to create a standout brand, recruit for niche roles and markets, and compete with other companies offering lavish sign-on bonuses and salary packages.
“When 88% of managers are experiencing pressure in achieving their goals because of hiring, you can be sure this represents business risk,” Daniel Chait, Greenhouse’s CEO said in the report. “Hiring is a business-critical function [that] needs to be structured, measured, and continuously improved on.”
Bad hiring practices can hurt hiring managers
One of the biggest lessons of the current job market is that sloppy hiring practices can leave a lasting impression on everyone involved in the process.
This has become an even bigger issue, as more and more candidates discuss their interview experiences online on platforms like Blind, Glassdoor, and TikTok. Companies with a reputation for biased hiring or poor communication will struggle to find qualified candidates. And often that burden falls squarely on the hiring manager.
Chait cites a troubling inverse proportion: As it gets easier and easier for individuals to find a new job, the pressure on hiring managers only increases.
“Companies have realized their potentially unfair hiring practices—or even just simple sloppiness like ineffective interviewing or a habit of ghosting candidates—is coming back to bite them.” Over 75% of job seekers say they’ve been ghosted following an interview, according to Greenhouse’s Candidate Experience Report, released in February.
Candidates are also expecting the process to move more quickly than it has in the past, especially when they’re juggling multiple job offers.
“What’s most challenging for hiring managers is that everything has to go a lot faster,” says Sarah White, CEO of Aspect43, a research and advisory firm that works with HR leaders and recruiters. “If a company isn’t set up to support the quicker timeline that candidates expect, everyone has to double up on efforts.”
Many of the organizations White works with aren’t prepared to support the current pace of hiring.
“Recruiters describe losing top candidates to other offers before they can even make it to a second or third interview,” she says. “That can make them feel really defeated.”
It’s not just about wading through the sea of applicants for new job postings. Another struggle for hiring managers is keeping their existing workers from jumping ship.
“On top of new applicants, hiring managers have to hire way more replacements, and there’s often not as much focus on internal mobility as there once was,” White says.
In a recent survey Aspect43 conducted, 55% of hiring managers cited retention and turnover as the number-one issue impacting their ability to hire—and their company’s ability to thrive. Hiring new talent came in second place, at 50%.
But Greendoor's survey found that managers have found their internal candidates to be one of the best sources of talent, and that can help companies achieve two goals at one time, retaining talent while filling new roles.
Worker productivity fell to start 2022 at its fastest pace in nearly 75 years while labor costs soared as the U.S. struggled with surging Covid cases, the Bureau of Labor Statistics reported Thursday.
Nonfarm productivity, a measure of output against hours worked, declined 7.5% from January through March, the biggest fall since the third quarter of 1947.
At the same time, unit labor costs soared 11.6%, bringing the increase over the past four quarters to 7.2%, the biggest gain since the third quarter of 1982. The metric calculates how much employers pay workers in salary and benefits per unit of output.
Wall Street already had been looking for a 5.2% drop in productivity and an increase of 10.5% in unit labor costs. On a four-quarter basis, productivity fell 0.6%, the biggest decline since the fourth quarter of 1993.
Taken together, the numbers underline the inflation surge in the U.S., which has seen prices rise at the fastest level in more than 40 years. Federal Reserve officials on Wednesday announced they would be raising interest rates half a percentage point as part of an ongoing effort to control inflation.
A separate Labor Department report Thursday showed that jobless claims increased to 200,000 for the week ended April 30, a 19,000 gain from the previous period and above the Dow Jones estimate for 182,000.
Continuing claims, which run a week behind the headline number, fell 19,000 to 1.38 million, the lowest level since Jan. 17, 1970.
The productivity data reflect a quarter in which a variety of factors converged to cause a 1.4% decline in the rate of economic growth as measured by gross domestic product.
Rising Covid cases, runaway inflation, and the Russian invasion of Ukraine dented activity, though most economists expect growth to resume later in the year. Fed Chairman Jerome Powell said at his post-meeting news conference Wednesday that he still sees the U.S. in a strong position though inflation must be tamed if the recovery is to remain strong.
New applicants for unemployment aid in the US edged up last week but remain at historically low levels, as the tight employment market mitigated job losses.
There were 200,000 initial jobless claims on a seasonally adjusted basis in the week to April 30, according to US labour department data released on Thursday.
That was up from the 181,000 claims reported the previous week and higher than the median forecast of 182,000 in a Reuters poll of economists.
Although the most recent figures broke a four-week streak below 200,000, jobless claims remain at historically low levels. US job vacancies hit a high of 11.5mn in March, suggesting employers are struggling to fill positions.
Although rising inflation and interest rates could cool the hot job market, Nancy Vanden Houten, lead US economist at Oxford Economics, said employers would be more likely to slow the pace of hiring than let go of workers.
Continuing jobless claims, which measure the number of Americans receiving unemployment aid, edged down to 1.38mn in the week ending April 23, the lowest level since 1970.