Are you protecting your recruitment activity from the recession?

It’s fair to say that you don’t have to be a graduate of economics to see that there is vast amount of financial stress out in the big wide world at present. The cost of living is soaring, strikes in the public sector abound, energy costs are at an all-time high and the price of the supermarket shop is increasing. And added to this, interest rates are rising, as is the threat of recession. 

Overall, regardless of how you look at it, there is a noticeable economic downturn. This started with the pandemic, where workers have been made redundant or resigned due to an inequitable work/life balance. This resulted in a large number of vacancies and a very healthy recruitment market.

However, the shrinking economy has recently seen uncertainty in the job market as a result. It has become very important for hiring managers to evaluate their recruitment activities and ensure they protect themselves from any impending recession.

Employment flexibility

During the pandemic, workers discovered the wonderful work/life balance of working from home. Gone were the sitting in traffic queues, long commuting times, fighting for an expensive parking space and fuel or transport costs. Plus, the added luxury of arriving “in the office” ten minutes after having had a shower, and then be at home when the kids came back from school.

The expectation arose that this flexible or hybrid working revolution would now become the norm, if not the foremost perk of the job. 

The downside is that with winter now approaching, with the huge costs of energy, the home worker will be using much more electricity and gas during the day. And with energy costs having increased by enormous three-figure sums each month over equivalent times last year, working at the office might be cheaper in the long run. Added to this, the recession seems to be encouraging people back into the office to safeguard their job, as the single biggest saving a business can make is the cost of employing its people. 

This all leads to the potential for the buoyant job market of past months to reverse, with us seeing a decline in job opportunities.

However, the above having been said, a business that doesn’t continue to offer flexible working might find themselves at a disadvantage when searching for the talent they need, as candidates are continuing to see hybrid working as a major benefit.

It is therefore important that employers keep an open mind regarding flexible working practices to remain competitive.

Remuneration

When workers were leaving their jobs in an almost wholesale manner, this produced more vacancies than the employment market could provide. This meant one of the greatest freedoms of job choice seen for a generation resulting in a highly-competitive job market. Employers had no option but to inflate their salary options to attract the talent they needed. Many suggest this has created a false economy, with ramifications that can only be seen in the near future.

However, with the spiralling cost of living, irrespective of inflated salaries, the expectation that salaries will cope with these costs has now been embedded and continue to inflate salaries to attract the best. Candidates will only now accept around a 7% increase in salary as a carrot for a career move compared with around 3% before the pandemic, keeping the ball firmly in the candidate’s hand.

Don’t think negotiating will seal the deal

When an employer knows a candidate they want to employ is looking for £x as a salary and they offer £x minus 5% as an offer, that employer will quickly find that the candidate will more than likely negotiate that offer back to the original £x. This will create an aura of bad feelings and mistrust from the outset.

In the current job market conditions, the only failsafe, providing the salary requested is realistic and achievable, is that the request is accepted. Never make it a negotiation. Discuss salary early in the recruitment process in the most frank and honest way you can. That is what the candidate is there for. A salaried job that meets their expectations. If it’s a career move on the part of the candidate, you need to know why this is. It will otherwise be much more time-efficient and less embarrassing for both parties should the candidate be an excellent fit for the role only to find salary is a braking point that introduces ill-feeling.

Benefits

20 days' holiday plus bank holidays is no longer the desired fringe benefit it used to be. It has now become an expected inclusion. Candidates have become savvier, where flexibility, health and wellbeing, pension, travel, discounts, diversity and sustainability have become the top ‘wants’.

Employers need to check what their competitors are offering as fringe benefits as well as to check what benefits, in general, are available in their particular industry sector. Make sure you understand your own benefits package before discussing it with the candidate. It makes sense to prioritise your offering in this respect to stay ahead of the pack. Discuss this early on, as it may have a direct impact on the package the candidate already receives from their current employer. You will certainly have to equal or better it.

We are in a time of considerable change when it comes to recruitment and employment. Taking the above steps will help you remain competitive and recession-proof in your recruitment hiring and retention activities, despite current economic uncertainty.