Dealing with Candidate Oversupply: Pros, Cons and Implications for the Future of Staffing

The last 18 months has been hectic and highly pressured with HR departments, recruiters and business in general reeling from the effects of the economic recession. Applicant “glut” has resulted from widespread lay-offs, closures, and other business failures/shortfalls turning normal, skilled workers into fierce competitors for scarce jobs. What happened to the doom-and-gloom warnings we heard a few years ago about impending skills shortages, imminent Baby Boomer retirements, “brain drain”, and “winning the war for talent”? Instead, we’re faced with mountains of resumes for even Junior-level roles, frantic phone calls from desperate job seekers vying for too few jobs that are often beneath their former compensation levels, and over-qualified people chasing jobs that are beneath their ability. In preparing to write this article we surveyed HR professionals to explore how business is coping with current candidate over-supply, lessons learned, and implications for the future of effective recruitment and selection. First, the Good News … There is some great talent available right now! The numbers vary by industry, location and job type, but obviously oversupply is the theme. 1. Volume of resumes and applications is 2 – 5 times the norm. With this kind of over-supply you can “buy more with less” which is nothing but good news for business (as long as you have good hiring systems). 2. Retention is less of a threat than we ever thought possible two years ago. Because employees are generally afraid to be unemployed they are holding on to their jobs longer and turnover is low, making for more stability, an experienced workforce, and decreased training costs. 3. Dead wood is getting cleared out. Many employers are taking advantage of the opportunity to acquire higher-caliber talent by letting less able employees go and filling jobs with more capable people. 4. Mentoring is on the up-swing as employers bring in experienced (and often older) workers who are highly qualified to mentor and coach more junior workers. 5. Better selection methods. Forced by sheer volume, many organizations have tightened up and improved their selection methods by: a. utilizing subject-matter experts to screen resumes based on more thorough and exacting standards; b. using assessments to weed out those with poor job suitability; c. using telephone and virtual interviews rather than expensive and time-consuming face-to-face interviews; d. multi-part interviews that begin with a short (10-15 minute introduction), initial interview to weed out people as a screener; e. using professionally developed, job-specific interview guides to extract maximum information in minimal time for rating and decision-making (such as Interview Generator, found at www.BuildAnInterview.com). And then, The Not-So-Good News … The over-supply of candidates has a “dark side” as well. 1. Too many applicants to process efficiently. Resume overload can cause top candidates to be overlooked due to the sheer volume. Says Mariela Gognon, Technical Recruiting Expert: “Interviewers are receiving so many resumes that sometimes the strongest candidates are getting overlooked.” 2. Candidates not selective enough (and over-apply for jobs). With unemployment reaching the 10% level, many people have become increasingly desperate and are applying for jobs that they normally would not. Further, many candidates are minimizing their relocation issues, understating salary requirements, and generally presenting themselves as experts in many areas/fields, rather than zeroing in on their core competencies. According to Stephen Williams, President of Bench International, a global executive search firm: “Candidates in need are more likely to try to broaden their skills and experiences more (and often too much) than they were in the past when jobs were more plentiful. Selectivity in terms of what candidates will pursue has gone down while clients are becoming more selective towards the skills and experiences they seek. Candidates have to remember to stick with their core strengths and focus on what they can support as credible – stay on their “A” game because companies are using this as a time to take on “A” players. Self-dilution of candidate skill sets will ultimately be detrimental to their careers.” 3. Overly persistent applicants. Recruiters are seeing more instances of “over-the-top” behavior from applicants who will do anything to stand out and get a face-to-face interview. Phones are ringing off the hook as people try to get a live person on the phone. Said one HeathCare company staffing rep: “You can hear the desperation in their voice.” 4. Unfriendly employment practices. Because employment departments in organizations are overwhelmed, some have instituted policies and processes that make the candidate experience more unpleasant and burdensome. This short-term solution can have long-term consequences in terms of reputation and image in the marketplace once the economy rebounds. Witness new websites like www.howigotlaidoff.com that are completely devoted to capturing and chronicling the stories of the people who have recently been “let go,” including the often despicable methods in which they were dispatched. 5. Recruiter over-reaction. Some staffing specialists are so “spooked” by candidate glut that they are considering “passive” (currently employed) candidates only. The July 20, 2009 edition of Workforce Magazine stated that, “some recruiters are only going after working (passive) candidates because they think that laid off people are ‘damaged goods’.” Finally, the Confusing News … Some of what we are experiencing in the recruitment sector is unclear and even confusing. Here are some observations our experts reported: Long-term impact of an expanded job search. While experts agree that job seekers are less selective in terms of the jobs they are willing to consider, Tessa Mellish, OD/Learning & Development Specialist, warns of a potential backlash later: “Mature and highly experienced workers are expanding their job search to include lower-level jobs (but) the impact of candidates ‘devaluing their currency’ in this way will mean that when the labor market stabilizes in one to two years time, we will see a mass exodus of people seeking more senior roles and a soar in recruitment costs.” More detailed job requirements. Developing more detailed and exacting requirements is one way that recruiters have found to narrow the field. Says Peggy Baggott, IT Group Manager at Metier Resources Group: “In order to minimize the volume of resumes sent in response to an ad/posting, it is important to start with a detailed and highly specific job description. The more vague the description, the more widespread the responses will be. Having specific requirements is helpful in minimizing the resume flow.” This practice can backfire if the result is to cut off otherwise excellent candidates who may not have the extra year of background or other narrow (and often not critical) criteria. Tessa Mellish, OD/Learning & Development Specialist reports: “The impact on interviewers … is that, having seen an initial set of candidates, the interviewers are retracting roles and rewriting the job specs to include a wider and wider check list of requirements. 18 months/2 years ago, the trend was for highly specialized, narrow roles, whereas in this time of recession, I believe organizations are trying to maximize the scope of a role and in many cases are combining them.” Balancing turnover risk. With so much talent around, should you be worried about hiring the over-qualified? Opinions in this area seem to be mixed, with most concern centered on employee longevity after the recession. Todd Beck, Strategic Marketing Leader put it this way: “There is a risk of future turnover when the economy rebounds and here's another wrinkle … if, because of the ‘glut’, a company extends the time it takes to select AND/OR (worse) changes its process to make the selection experience less enjoyable and unfriendly for candidates, that company could create even more turnover when the economy rebounds.” Other HR professionals are elated that such talent is available and are less worried about the long-term. Richard Koethe, HR Director, US Military, believes that: “Folks who were in the past viewed as ‘over qualified’ is a great plus for an organization. New blood, new perspectives, new talents, greater levels of experiences and knowledge are all factors. It’s sheer madness from my perspective not to look at this pool of candidates. At some point there will be someone who will jump ship when things get better, but that can be influenced by better and more detailed hiring practices and, more importantly, by having organizational cultures that are supportive of folks in many different ways.” Recruitment / Selection Strategies Tough times often spark ingenuity and the current recruitment climate is no different. Some tactics you might consider include: Shortlisting. Culling a thicker stack of resumes takes time. Nick Tooley, Managing Director at Ideal People says: “Better and more thorough short-listing on receipt of CV’s and applications help to highlight star candidates and then bring forward these stars in for the face-to-face interview.” Consider using subject-matter experts (like line people) to help with the resume review and vetting process; chances are that they can do it faster and better than you can because they know the field or business better. Assessments. Consider inserting a good psychometric assessment to narrow the field. Particularly effective are “suitability” assessments like the Harrison Assessments system that allow you to create a custom job template for a specific job and then matches candidates’ job preferences to the template to yield fit. Focus on cultural fit. Strong recruiters are looking harder at whether a candidate fits the company culture, team dynamics and match with his or her new boss. Says David Boughter, HR Manager at HVAC Distributors: “When interviewing now, I am probing even deeper into the motivation of the candidate. I want to make sure that even though the person sitting in front of me may be of a higher than normal quality, that they are interested in our position and company for the right reasons and will be a fit.” Explore the candidate’s motivation. Particularly if the candidate is highly or even over-qualified, it can pay to probe more to discover why he or she wants to work for the company to determine fit and more subtle personal motivation. Reduce the number of face-to-face interviews. Use telephone interviews where you can to vet candidates. Consider adding a 10-15 minute introductory interview as a screener and take care to explain that this is a quick, “get-to-know-you” chat before progressing to the next stage. If presented well, this practice can cut the time in half that a face-to-face interview might add just to decline the candidate afterwards. Try Skype (with webcam) interviews. Many candidates have Skype (or other similar technologies) and may even have a webcam installed and are happy to do a remote interview with you as a first step; it saves time for both of you and is certainly a better experience than a straight phone interview (and, at least with Skype, it’s free!). Limit job board placement. Not every job should go to a job board. Says Lou Barron, Talent Management Manager for TransCanada in Calgary: “For some roles we have received more than 300 resumes. We find that we need to limit the number of external job boards for our more junior postings.” Know how your organization is perceived in the marketplace. Applicants are more savvy about company reputation and industry longevity now. Says David Boughter: “We see candidates seeking work with what they perceive to be a ‘quality, stable, and growing company’. (They) are willing to accept positions with more ‘job security’ rather than a position that may pay more but is in an unstable industry.” In Summary … Success in this environment bodes well for the future. Recruiting leaders capable of managing well now will be able to leverage performance when growth returns. Carol Gilson, VP HR and Client Service, EMPO Corp sums up these challenging yet exciting time this way: “It's definitely worth the due diligence to invest the extra effort (in vetting candidates right now) because there's a tremendous amount of talent currently available.” Go get ‘em, Tiger!