At some point, most organizations will find themselves making hiring decisions in the face of a challenging economy. Because the employment market frequently slows in response to economic uncertainty, companies often reassess hiring priorities and look for ways to tighten staffing levels while maintaining productivity and profitability.
Smart Hiring Strategies Employers Can Implement
It's not uncommon for companies to have a knee-jerk response to an uncertain economic landscape by putting the brakes on recruitment.
While a slowdown in hiring is normal during economic uncertainty, there are other ways you can respond to a downturn without compromising your workforce.
1. Prioritize employee retention
During uncertain times, the last thing you want is to lose valuable talent. Your existing team holds legacy knowledge and efficiencies that are critical to success when budgets are tight or growth is contracting.
Here’s what you can do to improve employee retention:
- Communicate with employees. Keep employees updated on how the company plans to navigate the economic crisis. This can assuage fears of staff layoffs, which may be prompting some employees to seek employment elsewhere.
- Recruit internally. Identify top talent you can promote to senior positions.
- Design individual development plans (IDPs). When employees are on a clear path of development that aligns with their career goals, they’re more likely to stay.
2. Adopt flexible hiring practices
In times of uncertainty, some organizations pivot to remote or flex-time working models or outsource work to contractors. This could be a cost-effective way to reduce overhead costs and structure your workforce without losing skills. Hiring contractors can also reduce the cost of employee benefits, like health insurance and retirement fund contributions.
3. Build a recruitment pipeline
If you’ve paused hiring, you can use the time to build a recruitment pipeline. When the economy bounces back, you’ll have a potential pool of candidates to draw from to fill positions.
To build a recruitment pipeline, start by analyzing your HR data to discern which recruitment channels attract the most applicants and which convert the best candidates.
For example, if job seekers often reach out to you on social media, ask them to submit their details online. When you’re ready to recruit, you’ll have a database of potential candidates to reach out to.
Implementing Effective Hiring Strategies: Answering Your Top Questions
When working with clients on recruitment strategies, we often answer the following questions:
What are hiring strategies?
Hiring strategies are the methods, techniques, and channels organizations use to attract, assess, and select candidates for job openings. Common hiring strategies include advertising jobs on the company website or job boards or using a recruitment agency.
Additional ways to create a dynamic recruitment strategy include:
- Setting up an employee referral program.
- Starting an internship program.
- Using online channels such as social media and community or industry-specific online groups.
- Participating in job fairs and career expos.
- Building a recruitment pipeline.
How do I create a hiring strategy?
To attract the right talent, you need a clearly defined hiring strategy, as explained in the following steps:
- Define your organization’s goals. What type of workforce do you need to take the organization in that direction?
- Conduct a skills audit. What are the current skills gaps that may be inhibiting your company’s growth?
- Identify your ideal candidate. Develop candidate personas for every job you advertise.
- Craft comprehensive job descriptions. Provide all the information that you think your ideal candidate will want to know.
- Target the right recruitment channels per job (as outlined in the previous question).
- Develop a selection process. This will include screening, interviewing, and candidate assessment and testing processes.
- Maintain a recruitment database. Keep a record of unsuccessful applicants and also maintain a list of candidates who reach out to your organization seeking employment. Their skills may match future positions.
What is skills-based hiring?
Skills-based hiring, also called competency-based hiring, is a recruitment strategy that focuses on evaluating practical skills, knowledge, and real-world experiences rather than relying primarily on educational qualifications and years of experience in a specific role.
If your organization is going through a talent shortage, and you’re also coming up short on your recruitment budget, then you may want to seek candidates with a more robust skill set. In addition to technical skills, candidates with excellent soft skills can support the organization through a recruitment freeze until you can fill vacant or new positions.
Soft skills can include excellence in:
- Critical and analytical thinking
- Collaborative skills (teamwork)
When you hire people with specific soft skills, you might be able to use their talents across different departments or projects within the organization. For example, suppose you're short on mid-level managers, and you hire someone with experience leading teams. That person could fill a leadership gap until you can fill middle management positions.
Skills-based hiring also helps employers:
- Speed up the hiring process.
- Reduce recruitment costs.
- Build a more diverse workforce by eliminating demographical biases.
- Enhance company performance. Hiring the right skills leads to a more productive and innovative workforce.
- Reduce employee turnover. When you have the right people in the right jobs, they’re likely to have greater job satisfaction and remain with your company for longer.
- Boost the company's brand reputation. Many job candidates research the companies they are considering joining. Being a skills-based employer can make you an employer of choice.
Other Considerations: Navigating Compliance in a Dynamic Landscape
As you adjust your hiring strategy during a volatile economic climate, make sure you follow state and federal laws such as the Worker Adjustment and Retraining Notification (WARN) Act and the Fair Labor Standards Act (FLSA). For example, you should pay particular attention to workplace regulations if you reduce your workforce, adjust salaries, switch to a remote working model, cut down on employees' hours, or implement furloughs.
To remain compliant and reduce risk to the company:
- Keep updated on HR laws and regulations, as local and federal labor laws may change during periods of uncertainty.
- Review and update your HR and organizational policies when necessary.
- Train HR managers on new HR laws and industry best practices.
- Communicate organizational changes to employees.
- Maintain accurate HR and employee records as required by law.
If you’re unsure of HR laws, seek legal advice. The onus is on the employer to remain compliant.
Adapting and Thriving Amid Economic Uncertainty
Employers may find it challenging to hire with confidence in a fluctuating economy. But they can increase the chances of making smart decisions by proactively nurturing their existing employees, adopting a flexible hiring approach, and building a recruitment pipeline.
Need help developing a hiring strategy? We can help. Contact us, and an account manager will be in touch soon!