Let’s Assume No Job Growth, Then What?

Let’s face it. We’re not in a growth industry anymore. Although many of us built our careers on the volume side of this business, it’s a different set of skills that will keep us employed. Last month the U.S. economy essentially created no new jobs, adding just 21,000 people. This almost mirrors January, when only 1,000 jobs were created. Economists and politicians debate back and forth on what has created a unique confluence of productivity, people, and cash. We have organizations that are more productive than ever, with fewer employees, and with piles of cash that are increasingly hard to put to profitable use. To some degree automation and job redesign have contributed to the productivity rise and the need for fewer employees, but the global economy has also contributed. Moving jobs and work used to take considerable skill and cost a great deal. Equipment tended to be large and required sophisticated support systems and supplies. Communication systems were usually limited to the telephone and travel was time consuming and expensive. Trade restrictions and import tariffs made the transfer of goods a tax expert’s dream. Languages and different cultures imposed costs on productivity. Today none of these remain true. Equipment, while more complex than ever, is more robust and requires less maintenance. Some of it can be serviced remotely via the Internet, and a worldwide network of supplies and technical assistance is readily available. The Internet and email have made communications easy and virtually free. The WTO has worked to open markets and remove tariffs, which has made moving goods or services easy. A large cadre of U.S. or Western-educated managers is eager to take over and manage the language and cultural issues. And finally, the educational systems in China, India, Thailand, Malaysia, Hong Kong, and Singapore have produced a wide variety of skilled and semi-skilled labor willing to work for low wages by U.S. standards. Anyone who has had an American or Western upbringing can understand why companies will always go to where the labor costs the least. Any incremental amount spent on education or training will be small compared to the basic cost of that service in the West. This means that the people who are in demand in the United States and in the West in general will have to be highly skilled and possess the talent and ability that cannot be readily purchased for less elsewhere. We see this in the IT world where systems architects remain employed, while common programmers find their jobs outsourced to India. We see it when skilled nurses are in short supply and easily employed here, but x-rays are read by radiologists in China or India. American firms will no longer have to do high volume hiring here in the U.S. There will always be the need to replace retirees and those who leave for greener grass, and there will always be some hiring to do for new developments, additional services, or for an incremental growth. But the volume of hiring may remain low for a long time. The recruiting equation is shifting from an emphasis on volume and cost to an emphasis on speed and quality. It is also becoming a more complex equation. We are adding new variables, including internal promotions and movement, entry-level hiring, and development as a sourcing strategy. None of these are new but they should be thought about very differently. Recruiters normally have played very little role in the internal movement of employees. They have facilitated the process, posted jobs internally and may have even done some interviewing of internal candidates. However, most of the time the hiring manager and HR played the key roles in internal transfers. Likewise, professional recruiters often had no role in college hiring, leaving the process to college recruiters who were frequently junior recruiters. Nor did they have a role in employee development. I know of only a half-dozen or so firms where there is a deliberate effort by recruiters to encourage the development of people to fill expected open positions on a regular basis. But today’s successful recruiter has to be an integrator of these elements. A recruiter needs a deep understanding of the current talent marketplace, both inside her own organization and in the world economy. She needs to be able to discuss skills in the context of the global labor pool and assist management in making the best decisions on outsourcing, based on value and quality and speed. Unfortunately, most recruiters work in micro-worlds. These micro-worlds are made up of their close personal network and their usual sources for candidates, and rarely are broad enough to be useful in a global context. Successful recruiters will find ways to leverage the new social networking tools and build and maintain worldwide talent pools. This recruiter also needs to have the skill, insight, and information to understand the direction the organization is heading and be able to project talent needs and looming gaps. Done well enough, this recruiter can recommend internal development programs designed to lessen the needs to recruit externally and improve retention. She also needs to see when talent is no longer going to be needed and have plans to redeploy that talent ó either internally or externally through her networks. But the recruiter cannot be successful without the help of human resources in general and without the help of management. The role is increasingly one of integrating and bringing systems harmony to a process that today is full of noise and activity, but does not produce efficiently or smoothly. Recruiting costs are still too high for the quality delivered. Selection is far from scientific, as ERE’s own Wendell Williams frequently points out, as recruiters are often much more comfortable with their gut than their head. The traditional resume-based applicant tracking system (ATS) is inadequate and old fashioned. The integration I am talking about will occur on the backbone of technology which includes the Internet, social networking software, interactive web sites, online selection and screening, e-marketing, and on the use of candidate relationship management tools. Your new role will be as a talent guru for your firm ó the voice that knows the talent market internally and externally, can tap into it as needed, can recommend development when it makes sense, and deliver or redeploy quality people quickly.