In just a few months, news of mass layoffs from industry giants has been coming from left and right. Moreover, indicators show continued signs of an economic slowdown around the world. However, not everything is falling by the wayside. There are some companies that are actively hiring in economic downturn.
So, as a way to weather the storm while we are unofficially in a recession, we put together a few tips on hiring in economic downturn that you can apply at any point in time.
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How the recession impacts hiring
Essentially everything else slows down when the economy slows down. This includes investments, the flow of business profits, and consumer spending habits, to name a few. All of these contribute to creating job opportunities.
As such, when economic activity is negatively impacted, unemployment rates conversely shoot up. A recent example that is still fresh in our minds is the COVID-19 pandemic.
Countries around the world took drastic measures to quell the rapid spread of the virus, one of which was lockdowns and quarantines. While there are critical industries, like the medical and food sector, that were operating at that time, almost every other business was at a standstill because of the virus.
What happens to jobs during a recession?
Companies execute mass recession layoffs or retrench employees to cut down on expenditures. In this case, labour costs. This is because economic activity and labour are inversely tied together.
What are the main reasons for hiring issues?
With that said, there are a couple of reasons why companies have a hard time hiring during recession:
- Time and resources needed for recruitment
- Shortage of qualified candidates
- Budget to hire and maintain staff
- Competition with other companies
What are the pros and cons of hiring in economic downturn?
If you are seriously contemplating whether you should be hiring during recession, then consider the following things.
Challenges of hiring in economic downturn
- Recession layoffs
- Hiring freezes
- Budget cuts
- Relocation concerns
- Applicant rich, candidate poor
Advantages of hiring in economic downturn
- The opportunity to overtake competitors
- An ability to refocus on strategy
- The chance to stand out
- An environment to spark innovation
What jobs are most at risk during a recession?
In the case of job seekers, what are the worst jobs during recession? While we are not experts on economics, we did notice a trend in recession job loss in these industries:
- Human Resources
- Real Estate
What are the best jobs during recession?
On the other hand, there are also recession-proof jobs available. Here are a couple of examples:
- Healthcare professionals
- Government employees
- Law enforcement
- IT professionals and developers
- Hospice staff
- Public utility workers
- Insurance appraisers and agents
10 Tips for hiring in economic downturn
If you are looking to hire while there is a recession, whether that is now or later, then make sure to apply the following tips below.
Conduct a skills gap analysis
A skills gap analysis is taking stock of the talents your company needs but does not have at the moment. Basically, assess the workforce you have right now. This will make it easier to identify the kind of talents you need to hire and priorities which ones to employ first.
Check-in with passive candidates
Recruiters talk to a lot of applicants and possible candidates that did not make the cut in the past. So, instead of just posting a job ad, it is better to first tap into this talent pool. This saves time and effort since they were already vetted in the past.
Focus on a niche
One of the challenges that most companies face during a recession is to attract and retain talent and customers. Instead of appealing to a broader audience, it is better to focus on a niche. Specialising in a niche ensures you have a consistent flow of business and interested applicants.
Let go of bottom performers
Another tip is to let go of bottom performers. This is a necessary step to ensure you maximise your resources and time. Moreover, for business, productive teams help retain clients as well.
Another tip is to actively train recruiters. This can include training them to better understand the industry sector that the companies operate in and identify the necessary skills to effectively vet interested applicants, to name a few.
In relation to letting go of bottom performers, you can also check other aspects of the businesses where you can reduce expenses. Take thorough stock of where the money and resources go and assess if these are maximised.
Apply the latest hiring strategies
Of course, the best way to hiring during recession is to apply effective hiring strategies. It is better to be updated as much as possible even if there is an economic downturn to attract the best talents and stay ahead of the competition.
Listen to candidates
With that said, there is always room for improvement even if you apply the latest hiring strategies. Asking the candidates directly or asking them to answer a short survey are a few ways to get a better sense of the aspects you can improve.
Create customised employee benefit plans
In the relation to the tip mentioned above, you can also ask candidates and existing staff about the things that the company can provide. It does not necessarily mean a bigger salary. This can be better health insurance, paid time off, and other perks that they will appreciate.
Strategise for every economic scenario
Lastly, as the saying goes, “Hope for the best, prepare for the worst.” The best way to recession-proof a business is to think and plan ahead. Even during a recession, it is encouraged to develop scenario-based strategies that will protect the company down the line.
Hiring in economic downturn is possible
Every business sector will be affected by a recession. However, the only difference is what companies do before, during, and after it happens. While some opt to do mass recession layoffs others choose to hire more people.
Things might be hard now, but you should consider the strategic advantage of hiring during economic downturn. With that said, aside from hiring an in-house staff, there are also other ways to get more capable talents, such as:
- Upskill In-House Staff
- Part-Time or Freelancers
- Offshore Hiring
If you are looking for a better way to hire during the economic recession, Flexisource IT can help you! We are one of the best IT Staff Augmentation companies in Australia. Check out our expertise.