It Is Harder To Find People When Unemployment Is High. Here’s Why.

This is a common misunderstanding by companies. As a recruiter, companies just don’t believe it when I tell them finding top talent is much harder when unemployment is high and easier when unemployment is low. I can sum up why in one word, “fear.”

This happens because even with 12% unemployment in California, only a very small percentage of those people will actually be qualified for your position. Variables to consider include location, compensation, industry, the right skills, years of experience, cultural fit and so on. This means that there really isn’t that huge of a pool of candidates to choose from in the unemployed arena.

That then leaves those currently working. But stop and think about those working for a minute. They are thinking, “The devil I know is better than the one I don’t know.” Do you believe they want to take the risk of changing jobs, having something not work out and then face unemployment for 6 months? Not very likely. Chances are they know people that have been unemployed for a long time, so working candidates bunker down. Staying with a company where they may not be happy is a whole lot better than unemployment. As a result, most employed people are not looking or even interested in considering something.

Contrast this with times of very low unemployment. There is no fear. The candidate figures that if the new job doesn’t work out, no problem, I will find another in no time so they are willing to consider other opportunities.

Don’t underestimate “fear” in your analysis.

This is why it is imperative for companies that want to hire top talent in bad economic times to be proactive in hiring and not reactive. Most companies have the philosophy that when they need someone, that magically out of thin air the stars will align and top talent will beat a path to their doorstep. WRONG. Top talent and those passive candidates work on their, not your, time table. Most companies hiring today are hiring because the position is critical, not just needed. So it is imperative it be the right hire and they get it right the first time.  To do this you must change from reactive (looking only when you need someone) to proactive, always looking and building a queue of candidates, so when you need someone you already know where they are. Until you do this  you will continue to hire from a very limited pool of candidates.