Does Poor Economy Make for a Good Hire?
A recession should mean that there’s a lot of available, qualified talent out there. That may well be the case, but you still need to act with caution. For example, with a wider range of candidates on the market, even greater due diligence is required to make sure you’re finding the best person. Making the right recruiting moves is where a great hire starts. Following are five common recruiting mistakes made in difficult economic environments:
- Thinking great candidates grow on trees—It may seem counterintuitive, but people are having a difficult time finding the quality candidates they want. How can this be? Typically, during periods of high unemployment, many of those top-tier candidates are still working and won’t be willing to move in an economy with so much uncertainty. Quantity doesn’t necessarily mean you’ll get the quality you need.
- Underestimating staffing needs—It’s not uncommon to understaff when times are tough. But what if you’re launching a new product or service and you forecast five employees, but the number gets cut to three? It’s a situation that could lead to employee stress and, ultimately, a costly level of turnover.
- Hire now, lay off later—It’s the opposite problem of number two: you hire someone and then lay them off three months later because of something unanticipated. If you make the decision to hire, make sure you can keep that person on for at least a year. If not, think about what you might be able to outsource.
- Undercompensating—Here’s the risk: Say you undercompensate a new employee by 25%. When the market bounces back and compensation is on the rise, are you going to be ready to up their pay significantly (by 25% or more)? It’s a scenario that has you ending up with a very short-term employee.
- Not replacing a key employee—If someone important leaves and you simply redistribute that person’s work, you’re creating a potential burnout and morale problem with those remaining employees that have taken on the additional work. Hiring in a recession is all about getting your hires right the first time, which will pay dividends once the recession is over and it’s back to business as usual.
Sources: “Top Five Mistakes Made by Companies Hiring in a Recession,” Recruiting Times