If you’ve ever seen competitive domino toppling, you know how amazingly intricate and graceful it can look as the dominos fall. The flowing patterns are fascinating to watch, and the more complex the setup is, the more satisfying the finish.
But that’s not how businesses and economies work. They’re never that fluid and spectacular looking. It’s more like the old board game Mouse Trap. You must combine a seemingly random mix of stop signs, lamp posts, rubber bands, boots, stairs, buckets, and more. While it may not look all that beautiful in the end, somehow, it works when you do it right, and the marble traverses the maze and makes it to the end.
Ultimately, many things are inextricably linked in our world of work: supply-chain dependencies, technological advancements (AI), labor market interactions (job creation), consumer spending and demand, government policies and regulations (EEOC, OFCCP, etc.), financial markets and investment, and globalization and trade.
The complex interdependencies are mind-boggling and ugly-beautiful – i.e., a perpetual Mouse Trap game that works when it works and doesn’t when some part of the maze fails.
And we’ve been trying to rebuild that Mouse Trap a lot since the pandemic. More recently, the revised job reports and the latest in August revealed lower numbers and a cooling labor market. There were only 142,000 jobs added in August, but unemployment ticked down to 4.2%, and wage growth continues. The Fed is more than likely to cut interest rates at least .25%, maybe more, but that economic impact will take time to permeate the markets. A divisive U.S. election and global wars continue to impact global economies as well.
According to our latest August CandE Pulse research, hiring is down 21% overall since June. Those freezing hiring are up 133% since June, and layoffs have decreased 31% since July. Redeploying is up dramatically as well (see figure below), and this aligns with how TA teams are accomplishing their priorities in August—optimizing current staff and technologies.
Our latest August CandE Puse research is based on over 100 responses from companies with 2,500-100K employees (52% of respondents) in industries such as healthcare, construction, education, manufacturing, nonprofit, hospitality, technology, and others.
CandE Pulse Hiring Status
Candidate frustration globally was higher than ever in our current benchmark research, and resentment as we measure it – the percentage of candidates who said they had a poor candidate experience and are no longer willing to engage with those businesses and brands they had applied to – is also higher.
The sheer volume of applications for open jobs continues to increase, with serial appliers getting help from AI here (insert existential irony). Plus, with continuing layoffs and leaner recruiting teams that struggle to respond, it’s no wonder that candidate resentment is higher. The recruiting team size decreased by 17% from last month in our CandE Pulse survey, and the overall trend line here shows that the size continues to decrease over time (see figure below).
Recruiting Team Size
When we look at the trend line with the overall recruiting budget, it’s been on a downward trajectory since January (see figure below). With the exception of resilient industries like healthcare and construction that keep driving job growth, everyone else is slowing and tightening. This is not a good sign for those of us who were betting on a soft landing after inflation came down. We can still get there, though; the next six months will tell.
Recruiting Budget
With all this cooling and tightening, where were August’s recruiting priorities? We’ve asked our CandE Community and beyond in our CandE Pulse surveys since January 2023. With candidate resentment as high as it is, it’s good to see that candidate experience is again the number one priority.
Screening and interviewing are still high priorities. They had been the number one CandE Pulse recruiting priority through May, and now it’s #2 in August. As we begin to analyze this year’s CandE Benchmark data, we’re finding it to be a continued priority for companies to focus on. Referrals, branding, and recruitment marketing claim the last three spots in the Top 5 recruiting priorities. Referrals aren’t a surprise since employers continually depend on them, and in this frustrated candidate market, referrals are even more competitively vital.
Top 5 Recruiting and Hiring Priorities
As always, this is only a partial list of what we ask, and it’s clear that priorities can change. Granted, the mix of employers responding to these surveys each month is different, but it’s still a sample set of current priorities.
In addition to asking what employers’ priorities are month after month, we also ask them how they will get all their work priorities done (see figure below). Out of the top five monthly, the most regularly recurring one was usually “Improving Processes.” But this time it dropped to the #3 spot, with current staffing and technologies jumping up to the #1 and #2 spots. This makes sense based on the anecdotal evidence working with our CandE employers who are optimizing their teams and their technologies.
Candidate/employee experience survey feedback came in at #4, which is still an important way to validate what processes are working and those that are negatively impacting the business and the brand. Whether gathering continuous feedback from candidates and/or participating in our benchmark program, companies that analyze and act on this data can create a competitive edge in a continuing volatile marketplace. This includes participating in our annual CandE Benchmark Research Program and considering investing in continuous candidate experience feedback with our survey partner, Survale.
Top 5 Ways to Get It All Done
As we do each year in our benchmark research, and now monthly in our CandE Pulse surveys, we again highlight how employers self-rate their own recruiting and candidate experience and whether or not they are leading, competing, improving, or lagging. Will those who said they were competing or improving, the usually biggest segment of responses, continue to decrease? The trend lines continue to be clear – since January, “competing” has been decreasing precipitously, and “improving” is now, well, improving (see figure below).
All the market factors outlined in this article and in many of our monthly CandE Pulse articles continue to contribute to a poor “competing” self-assessment and the fact that those who said they were “leading” are down by 23% since June. Those who said they were “lagging” are up a whopping 400% since May. Cooling labor markets, leaner recruiting teams, increased applications, higher candidate frustration, and more are all factors here.
These are self-reported ratings and subjective, and they also represent a different mix of employers each month. However, we definitely prefer employer confidence in competing and leading to remain stable or increase. Of course, there’s constant volatility, and the proof is always in the candidate experience ratings themselves.
Self-Rating Recruiting and Candidate Experience
Lastly, with all these market changes, AI continues to stand out, which is both good and not so good. We changed one of the questions we ask each month in the CandE pulse to: Are recruiting technologies with artificial intelligence (AI) helping you to optimize and improve your recruiting and hiring efforts (for example, sourcing, screening, candidate communications, interview scheduling, etc.)?
- 40% said yes
- 26% said no
- 6% said not sure
- 23% said they’re currently not utilizing any AI recruiting technologies
- 5% said they plan to purchase AI recruiting technologies in the future
AI’s impact on recruiting and hiring has become more valuable but is still in its infancy. Unfortunately, it also continues to be overblown, misrepresented, and misunderstood. Especially since a major theme we’re seeing in the candidate comments from our research is the fact that more candidates believe, more than ever, they’re being selected out due to artificial intelligence. AI impacts how top-of-funnel candidates are filtered and sorted, but most companies we work with do not use AI to make final selection decisions. Humans still do that.
For those humans who are using AI recruiting tech, we’d like to know why 26% of the TA respondents said that, no, AI recruiting tech doesn’t help them versus the 40% who said yes, it does. Misrepresented, under-utilized, and under-optimized for the no’s? Maybe. We’ll have to keep asking.
So, after all this, what happens next? No one knows, but we just started capturing data for our September CandE Pulse results, so you can jump right in and answer the survey here.
Most economists still agree that the U.S. economy is strong (-ish) compared to the rest of the world. Overall, our August CandE Pulse results align with the greater market forces in play. Everything is inextricably linked, and sadly, our “Mouse Trap” has some failing parts that need to be addressed. But we ultimately always fix the mind-boggling and ugly-beautiful interdependencies, and recruiting and hiring will persevere.