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The Return of Recruiters - SHRM
The Return of Recruiters
Will staffing professionals be the first or last to be hired as the economy recovers?

Amid accumulating signs that the Great Recession is moderating, companies that believe their core business is improving may begin to restore the employee positions they shed over the last several months.

Has the hiring begun? More to the point, are these companies building up their depleted cadres of staffing professionals in anticipation of employee hiring? Could the hiring of recruiters be, in the terminology of The Conference Board’s monthly national report, a leading economic indicator?

Experts’ opinions vary, but taken together their answers present a vision of workplace recruiting operations after the recession that will be quite different from the staffing models of a few years ago.


Help Wanted?

Angie Salmon, senior vice president of the executive recruiting firm EFL Associates in Leawood, Kan., says some organizations are starting to hire "because they feel more confident about the market and their businesses."

A recent survey by recruitment consulting company DoubleStar of West Chester, Pa., bears this out. Asked late last year whether they planned to increase hiring activity in the first quarter of 2010, 27 percent of respondents—representing organizations in the Mid-Atlantic states—said yes. This represented "a pretty good bump" over the 13 percent who indicated such plans for the fourth quarter of 2009, according to CEO Harry Griendling.

And the Society for Human Resource Management’s latest Leading Indicators of National Employment (LINE) report, released in March, revealed that hiring was up on an annual basis for the fifth straight month. The percentage of companies hiring in manufacturing will reach a level not seen since June 2008, according to the report, and the percentage of companies hiring in the service sector is the highest since July 2007. The LINE report is based on a monthly survey of private-sector HR professionals at more than 500 manufacturing and 500 service-sector companies.

Mitch Beck, president of Crossroads Consulting in Monroe, Conn., has seen hiring pick up but notes that some companies are keeping quiet about it. "What I’m finding is that more companies are starting to hire back but don’t want people to know they’re hiring back, because they don’t want to get inundated" with applications, he says.

Not everyone is optimistic, however, that economic recovery will translate into more jobs. Scott Craighead, general manager, Americas, of Bluesky Executive Search in Fairfield, Conn., says that, in general, "Economic recovery has occurred without hiring increases, as companies have focused on staff cuts to yield profits."

Even if they aren’t cutting staff, companies may not be bringing new hires on board. For example, "Smaller hedge funds that need to hire are standing on the sidelines," says Ev Nucci, owner of Nucci Consulting Group of Gwynedd Valley, Pa., a retained search firm serving the hard-hit asset management industry. "A friend of mine who owns a hedge fund needs four or five people but is holding off" because of concerns about the economy, she explains.

Still, companies with skeleton crews can’t operate that way much longer, says executive search consultant Kevin Palisi of Norwalk, Conn. "You’re going to see more hiring because [companies] can’t squeeze any more blood out of the [surviving] workforce, from a productivity standpoint."


Leading or Lagging Indicator?

"This recession has decimated HR departments and, along with it, recruiting departments," Griendling observes.

Are reinforcements on the way?

Those who think companies plan to increase overall hiring in the near term believe so. For example, Mark Mehler, principal of CareerXroads, a staffing strategy consultancy in Kendall Park, N.J., says certain online companies "are hiring in volume." Those companies—and others wishing to add to employment rolls—must first hire recruiters, he explains, noting that "Recruiting is a bellwether for the economy."

Palisi also believes that organizations "are interested in bringing in recruiters in the near term, the anticipation being they will hire more staff in 2010." He adds that companies "need to hire recruiters six months ahead of the curve."

Others say companies will continue to make do with the resources they have on hand for a while and that an increase in recruiter hiring could actually be a lagging indicator of recovery.

"Usually the first person to get fired and last person to get hired back in a recession is the recruiter," says Dan Finnigan, CEO of Jobvite, a Burlingame, Calif.-based marketer of technology for recruiting via online social networks. "Many companies will actually not hire recruiters right away and be forced to recruit with a smaller recruiting team."

He cites a client—an online retailer—that hired 60 employees in six months during 2009. "They tripled [the workforce] and did it with one recruiter," he says.

Griendling notes that after a recession, companies tend to test the waters by hiring temporary workers as opposed to regular full- or part-time employees. And, in fact, the U.S. Bureau of Labor Statistics reported that 284,000 temporary-help jobs have been added nationwide since September 2009, including 48,000 in February. According to Griendling, it isn’t until later in a recovery, when companies start hiring non-temporary workers, that recruiters are brought on board.

Lisa Rowan, program director, HR, learning and talent strategies, for advisory services provider IDC in Framingham, Mass., expects hiring of temporary workers "to come up further before we see any surge in permanent employment."


Get in Line

Companies looking to grow their workforces may turn to transitional help, such as staffing agencies and freelancers, before hiring recruiters.

As piles of resumes roll into their headquarters, companies find it "easier to inundate an outside recruiter" such as an agency, according to Beck.

Staffing firms and consulting firms confirm the trend. Tracy Cutone, partner and general manager, Human Resources Divisions, of the staffing firm Winter, Wyman Cos. in Waltham, Mass., says demand for contract recruiters from its clients was up more than 85 percent between the third and fourth quarters of 2009.

Griendling adds that his company, DoubleStar, was hired by four new clients in a recent 60-day period, and it has its "largest new business pipeline in the last year and a half."

Freelancers may be in line ahead of staff recruiters, too. "Small to mid-size firms are bringing the search function in-house [by] hiring ex-search consultants to be their in-house recruiter on a contract basis," Nucci says.


A New Model

Another strategy being used as companies try to do more with less: Many are asking hiring managers and employees to take on more staffing responsibilities. Some experts believe this trend could continue for some time, so even after some semblance of a professional recruiting operation is restored, veteran staffing professionals may not recognize it.

"The hiring manager will no longer just be the end of the road for hiring decisions, but also the person identifying talent," Finnigan says.

"Hiring managers, although not experts in recruiting, will be forced to be," Salmon agrees.

Also taking on more recruiting tasks, according to Salmon, are ordinary employees in other departments. "Responsibility for recruiting has been pushed out into the organization," she says.

Finnigan calls it a whole-company approach to recruitment. "Employees will be called upon to make referrals and publicize jobs. Even executives will need to be on the front lines. … Referral hiring is the nirvana of recruiting," but it’s not easy. So, he says, companies are asking employees to tap into their personal online social networks. Instead of posting and advertising job listings, businesses are seeing if they can get their first round of applicants through referrals.

What is lost with this strategy, Salmon notes, "is the expertise in recruiting, particularly the recruiting of passive candidates" by staffing experts who have built their own, focused networks and developed the skills to manipulate them efficiently.

Using professional recruiters is still "the best way to find the right people," Salmon says.


Recruiting Recruiters, Finally

Eventually, organizations will become too lean. "Once it gets to that point, companies are going to realize that their people are working 24/7 and are maxed out on productivity," Craighead says. "When people scream and say, ‘I can’t take it anymore,’ they will have to hire."

He adds, however, that businesses are unlikely to rehire experienced recruiters back to pre-recession levels. "Companies will act cautiously in rehiring them," he says.

Finnigan concludes that companies are going to hire recruiters eventually, but not until after a lot of other things happen. "When you see that spike, you’ll know we’re in a recovery," he says.

In recovery, Finnigan predicts, the recession will leave a sharpened emphasis on the bottom line. "Before companies are going to build up recruiting staffs, they’re going to ask for the [return on investment] in doing so. … Before HR will get approval to hire more recruiters, they will have to answer the question, how much money must we spend?"

______________________________________

Steve Taylor’s most recent article for Staffing Management magazine, “Sometimes More Is More,” appeared in the October-December 2009 issue.
______________________________________

Reprinted with permission from the Society of Human Resource Management (SHRM) for inclusion July 15 - September 15, 2010. Taylor, Steve. "The Return of Recruiters". May 5, 2010. Accessed online at http://www.shrm.org/Publications/StaffingManagementMagazine/EditorialContent/Pages/0410taylor.aspx on July 15, 2010.

India Surpasses the U.S. in Global Recruiting Leadership


ereawards-toplogo-2010by Dr. John Sullivan and Master Burnett


Becoming a leading-edge recruiter is an admirable goal few corporate recruiters strive to achieve. Not only must a leading-edge recruiter routinely demonstrate a marked increase in positive business impact over other recruiters, but they must consistently monitor trends, devise new approaches, benchmark against emerging practices, and constantly fight with colleagues often resistant to trying something new.


Historically, staying on top of trends and new approaches was relatively easy, as there were only a few companies isolated in a few narrow geographies that one needed to watch. The War for Talent in 1997 certainly drew a lot of attention to the practices of technology firms in "silicon hubs" like California's Silicon Valley (home to Google, Cisco, Intuit, Facebook, Twitter, and HP) or Seattle, Washington's, Silicon Forest (home to Microsoft and Amazon), but up until a few years ago there was no formal process to identify where leading-edge practices were emerging and who was developing them.


ERE Media's Recruiting Excellence Awards and articles by global strategy advisors like Kevin Wheeler and ourselves, who have advised and studied the practices of companies in more than 40 nations, are helping leading-edge recruiters focus their attention where evolution is occurring.


The Hotbeds of Evolution and Innovation are Shifting


No one can argue that rapid growth of the technology sector in 1997 left many technology companies desperate for talent, and that desperation drove many charged with recruiting for such organizations to both collaborate and innovate new practices to help close gaps in supply and demand. While not cheap, importing labor and shifting work to geographies where the supply of labor exceeded the demand has been the dominant approach.


For more than a decade such solutions have helped allocate work across an emerging global talent market, but now many of the geographies that picked up work are also struggling to source qualified talent to staff available projects. While China and India may have a surplus of unemployed/underemployed people, they too have a shortage of skilled professional labor.


As global economic growth focuses on Asia, desperation of firms in Asia to keep pace with the demand for talent is driving more and more talent management focus on excellence in execution, collaboration, evolution, and innovation.


With smaller company sizes, nations like Australia and New Zealand are earning a reputation as being home to progressive companies willing to try new practices. Nations like Singapore, Malaysia, and Vietnam, to name only a few, are channeling state investment dollars into industry-sector-focused universities and research parks that elevate public/private collaboration to new levels.


However, nowhere can one find as much focus on recruiting leadership than in India and China. Twelve years ago production standards in both nations were subpar, work ethics were questionable, and infrastructure was lacking, but today both nations have firms that excel in world-class engineering design, international trade, offshoring, and manufacturing. Over the course of those 12 years, firms in India and China have not only studied and adopted Western talent management practices, they have improved upon them if not in design, most certainly in execution.


Examples of Progressive Recruiting and Talent Management Practices


While ERE readers will need to wait until March to learn about which companies won a recruiting excellence award (with finalists announced soon), what follows are a few practices becoming common among leading employers in India based on our work and a review of the ERE Award Applications. Mentally compare this list of practices to those that are currently in operation at your organization.


General Recruiting Practices



  • Prioritization of key jobs and skills. Recruiting resources focuses on the most critical 40%.

  • Pre-need hiring. Talent pools mapped and individuals assessed prior to requisition opening.

  • Tight integration with sales/operations to drive workforce planning. Recruiting leaders often sit side by side with sales and operations leaders during development meetings to coordinate workforce planning efforts.


Employee Referral Program Practices



  • Dedicated referral teams employing a proactive referral strategy in which recruiters personally solicit the names of the very best from the very best employees and managers. (In one organization this approach produced 47% of all hires, garnered a 66% employee participation rate, and consistently produced the highest quality hires, all with a cost-per-hire 20% lower than other hiring channels.)

  • Employee referral processes that target corporate alumni in order to boomerang them back. (This approach often produces better results than any other alumni recruitment effort.)

  • Onsite referral fairs that allow referred candidates to receive on-the-spot interviews and/or offers.

  • Online referral status tracking that provides feedback on status and alerts when a referral's status changes.

  • Established referral targets for individual managers and teams.

  • Required pre-assessment of referrals by referring employee. To eliminate poor quality referrals many programs require that employees pre-assess their referral and share the assessment as part of the submission process.

  • Service-level agreements that guarantee feedback to the referring employee within 72 hours of submission and help-desk response to inquiries within eight hours.


Metrics and Business-case-related Practices



  • Advanced statistical analysis processes including six sigma assessment, value chain analysis, and force field analysis for assessing and improving recruiting process performance.

  • Quantification of the direct-dollar impact of new hiring processes on corporate revenues. (In one example, the organization identified that reducing time-to-fill in revenue-generating positions by 40% could increase revenue by millions of dollars.)

  • Development of "hiring accuracy" metrics that assesses and quantify hiring success/failure rates.

  • Distributed real-time recruiter productivity measures. (One organization found that simply measuring and reporting productivity increased it 70% in one year.)


Recruitment Marketing and Branding Related Practices



  • Development of in-house recruitment marketing teams capable of supporting frequent communication design/delivery channel changes.

  • Using search engine optimization techniques to measurably increase visibility of jobs and brand messaging online.


College-recruiting-related Practices



  • Using ambassador programs to build relationships with top students and faculty.

  • Adoption of CRM approaches that let recruiters communicate frequently with students via text messages about events in the students' lives, such as “best of luck” messages during final exams.

  • Development of robust campus performance assessment processes and metrics.

  • Use of contests, quizzes, and projects to excite top students and more accurately assess them.

  • Engagement of market intelligence data to identify employee value propositions that better engage students.

  • Online professional training courses covering topics that improve the quality of potential candidates and attract top students to participate in the application process.

  • Leverage alumni to give tech talks, classroom lectures, and on-campus workshops.

  • Curriculum guidance. Many organizations work closely with academic leaders and key faculty to align curriculum with industrial need, ensuring that courses focus on practical knowledge and skill development that is immediately relevant.


Training and Development Practices



  • Extensive focus on deep enterprise training, development, and leadership preparation. (One organization has built the world’s largest leadership and development training center, exceeding in size GE’s famous Crotonville facility. The 270-acre, $60-million plush facility has a hotel, food center, employee care center, theater, and research facility.)

  • Overseas residential training programs. Recent grads are frequently provided an opportunity to work internationally for a period of several months prior to accepting a stationary role in their home country.


Are You Leading or Lagging?


I hope you agree that this list represents some pretty progressive practices and strategies. While India's leadership position is certainly open to debate, there can be no doubt that staffing challenges in India and China are forcing leading firms like Infosys, Tata, Aricent, Reliance, and Wipro to focus on execution and innovation. Some might argue that lack of government regulation and lower cost of labor enable them to do things you couldn't do in the U.S. or Western Europe, to which my response is simple: it's not the job of a leader to whine about what they can't do, but rather to find a way to do what they need to do.


Not all organizations in India are on the leading edge when it comes to talent management and even those that are have areas that need improvement. The point is that if you want to be on the leading edge you need to be aware of other organizations on the edge, and that moving forward more and more of the firms you need to monitor will be in India, China, and other Asian nations.


Final Thoughts


Generally speaking recruiting is a conservative profession. If you’re a "defensive type," super patriot, or resist being data-driven, you will likely dismiss our contention that the U.S. is/has slipped into second place with regard to recruiting leadership. If, however, you are open-minded, I suggest that you revisit this list of practices and use it to help determine where your firm needs to be if it’s going to seriously compete for talent in the emerging global labor market. Companies in India, Singapore, New Zealand, and China have already started recruiting top scientists, mathematicians, engineers, and finance professionals from leading corporations in the U.S. and Western Europe. The battle is heating up. Are you more prepared to fight or give up?


URL: http://www.mntrn.org/modules/planet/view.article.php/2625
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