Why Is Hiring So Hard for Employers Right Now?
It’s an extraordinary labour market with entirely ordinary causes.
Something is up in the labour market. Across the country, Line Managers/Business Owners and HR professionals keep telling the same story: they have a lot of jobs sitting open and can’t find anyone to hire.
The ‘resignation rate’ apparently is at its highest level since 2008 and unemployment has dropped to 4.9 percent, meanwhile, the time it takes to fill those newly-emptied positions has hit record highs. At 22.9 days to fill an average job opening, the per-worker investment has grown dramatically in recent years jumping by more than three days per opening since 2009.
So what’s happening? These may be unusual circumstances, but the drivers are entirely fundamental. It boils down to money and fit and as employers struggle to hire, the reasons for this struggle boil down to wages and mismatched talent. Buying a house, you can get an engineer to come and look at the foundation; buying a car, you can take it to a mechanic. (But) people have so many soft skills that it’s very different to know what someone can contribute to a company until after they’re in it and working. And that process is only made harder by the lack of available talent.
According to recent data the ratio of job seekers to job openings has been sinking for years, most recently hitting 1.4 job seekers to every job opening. With the supply of labour and the number of job openings approaching parity, finding talent can feel like hitting a bullet with a bullet.
Not every industry shares these struggles equally. As many employers have pointed out, it’s simply harder to hire for some skills than others. Whether that’s driven by a specific STEM shortage remains hotly debated, but there’s no question that hiring times and the labour market go hand in hand.
Here, for example, are the three industries where jobs stay open the longest, according to the some recent hiring indicators:
- Public Sector: 35.5 Days
- Financial Services: 42.8 Days
- Health Services: 48.3 Days
Compared to the shortest:
- Administration/Resources: 14.2 Days
- Construction: 14.5 Days
- Leisure and Hospitality: 19.7 Days
As Glassdoor’s analysis on interview duration has shown, hiring durations by industry have gotten longer. Public Sector jobs can take upwards of 60 days to interview, while universities and hospitals will spend a month or more placing a single candidate. The retail and franchise sector, on the other hand, will hire with a brisk eight-day process and in this climate, employers in general need to speed up their hiring process in order to not miss potential candidates, and it’s not as simple as skill mismatch when companies are recruiting.
There are actually fewer available workers overall, and they’re getting vanishingly rare in the industries most desperate to hire.
To speed up hiring, look where the workers are–or train them.
What can an employer do about this? Start by considering geographic flexibility. Firms who have to compete in hot labour markets are going to struggle, but that doesn’t mean there’s no one out there. They just may not share your particular postal code.
Employers in certain cities face a shortage of local workers, but you’re not out of luck. Consider instead whether it’s possible to allow home working or to offer staff a position at another office. The labour market is brewing almost a perfect storm for employers today. With applicant/opening ratios at a meagre 1.4 and unemployment plummeting in coveted skill sets, the odds of finding a highly trained unicorn are getting larger—and so is the time it takes to find her.
So consider searching afield or training someone with fewer turnkey skills instead. The right candidate might not be the one who comes in knowing how to do the job right off the bat. She might be the one with the talent and the drive to learn and eventually teach others.