A spike in layoffs ... ongoing talent shortages ... a potential recession looming. CHROs play a critical role in this contradictory talent market.
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Back in 2020, many companies laid off employees in reaction to the pandemic. Then, a couple of months later, those same companies started hiring en masse, offering double their previous salaries to bring back talent. Now, some of those companies are announcing layoffs once again. Meanwhile, unemployment remains low, and other organizations continue to struggle to find enough talent.
These two phenomena appear to be contradictory, leading to confusion surrounding the current job market. At the same time, employee disengagement has led to the rise of "quiet quitting"—and quitting altogether.
The key for companies to thrive, let alone survive, during this turbulent period is to be less reactive to each new talent-market trend. Instead, successful companies invest time and effort into understanding and revisiting the way they attract and retain talent.
CHROs play a critical role in driving these talent attraction, development and retention efforts. Some efforts involve better planning, tracking and technology. Others focus on improving engagement with candidates and employees. To navigate through the current confusing job market, here are 10 action items CHROs should address:
1. Forecast hiring one quarter ahead. The hiring process can't be reactive to ad hoc demands. Instead, work on a forecast. Plan for at least one quarter ahead and then audit once a month. Plan your hiring needs—where the demand is coming from—and how you can close the gaps internally and externally.
2. Revamp your recruitment tech stack. Good candidates won't stay in the market for more than 10 days. Use technology to improve hiring velocity. Introduce AI sourcing tools, which allow recruiters to focus on engaging with candidates instead of spending hours on sourcing. Use video interviews and online assessment tools to help the candidates and interviewers save time. Introducing new technology into hiring will not only improve hiring velocity but also improve cost-per-hire and the candidate experience.
3. Leverage data and people analytics. Organizations are increasingly shifting toward data-driven decision-making. The same goes for HR. Without understanding the current state of the company via hard metrics, you can't prioritize or plan for the future. There is a core set of HR metrics that every company should track, and those metrics should be revisited over time. In addition to tracking metrics, have dashboards ready for hiring managers and recruiters to measure their productivity.
4. Collect feedback from candidates and employees. Survey candidates who were hired, those who were rejected and those who rejected your offer. Collect feedback from your employees on why they stay and why they might look elsewhere. Don't wait for employees to resign to tell you they left for more money. It may seem like they're leaving to get more money, but this may not be the main reason that made them leave.
5. Focus on skills and potential rather than experience. Considering the high competition for the most desirable jobs—combined with the severe talent shortage—companies should invest in understanding their skills gaps and plan for how to close those gaps internally. Investing in upskilling and cross-skilling employees will not only address your hiring needs but also result in more engaged employees who know the company is investing in them.
6. Get creative with how you attract talent. In this competitive market, traditional hiring might not give you the results you need. One creative move is to engage your employees in your hiring efforts. For example, have sourcing parties where employees are rewarded for sourcing candidates for their teams. Plan hackathons and other hiring events where candidates can get an offer within 24 hours.
7. Create an internal job marketplace. Make it easier for employees to be able to apply to any open position for which they are qualified. Give employees the opportunity to explore different roles within the organization, which exposes them to different technologies, geographies and responsibilities. Employees who don't have opportunities available for them with their current employer might look elsewhere.
8. Invest in culture. People stay or join companies that invest in social responsibility and diversity and inclusion. Create a clear strategy around what distinguishes you from other employers and what you want to be known for. Make employees your partners in building the policies and practices that support your culture. Be sure to showcase the good behavior that you preach.
9. Focus on the employee and candidate experience. From automating processes through chat boxes to creating different channels of communication, give employees transparent access to the company. Provide frequent updates on how the company is performing and how their jobs are contributing to the company's growth. The same applies to prospective candidates: Make the interview process fun, creative and engaging—for example, by using gamification.
10. Tailor your retention strategy to top talent. Frequently review and identify your top talent. Understand their aspirations and desires, and align your retention plan accordingly. Recognize tenured employees for their loyalty, compensate top performers competitively and reward employees who invest in learning.
As company leaders, CHROs must reflect frequently and ask ourselves whether we are prepared for any trend that will come next. Only through our own self-reflection can we decide which way to move forward to attract talented candidates and retain valued employees while protecting the company from turbulent market conditions.
Einav Lavi is the CHRO of Qualitest, the world's largest AI-powered quality engineering company. She has more than 20 years of experience in the areas of human resource management, business and finance management.
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