Let's Look at Open Jobs + Unemployment Benefits Through the Lens of a Recruiting Department...
May 12, 2021
Do you believe that COVID-related unemployment benefits are preventing people from rejoining the workforce? This became a hot topic when the April 2021 Jobs Report showed one of the biggest misses on record—meaning the actual number of jobs the American economy was expected to add fell dramatically short of the expectation.
Like everything these days, it's been politicized. The GOP is out in force claiming people have been de-incentivized to work because of COVID unemployment. Joe Biden made a rare appearance to defend unemployment benefits policy, citing “There’s been a lot of discussion since Friday’s report that people are being paid to stay home rather than go to work," Biden said. “We don’t see much evidence of that.”
There's only two pieces of data that matter, and they're facts, not opinions. 1) Employers can't find the people they need, and 2) Potential employees that remain among the unemployed aren't taking jobs.
So let's get out of the opinion game and look at the numbers, and think about how a modern TA/Recruiting department deals with a sudden rush of openings. I've been through that game many times (as many of you have) and know the following to be true.
Let's start with the facts in the April 2021 jobs report:
--Total Open Jobs in America: 7,000,000+
--Total Number of Jobs Economists Expected to Fill out of that number: 1,000,000
--Actual number of Open Jobs that got filled: 266,000
--Performance vs Expectation: 26.6%
Feels like an F at best. Maybe there's a curve we're not aware of.
But that analysis is just low hanging fruit. Many of you are already aware of these numbers. So let's add some value by thinking about how a modern TA/Recruiting Department tackles a big rush of open jobs.
Many of you have seen your companies experience something similar to this. It goes a little something like this:
1--Your company was doing NO HIRING, THEN THEY OPENED UP 4-6 MONTHS WORTH OF POSITIONS.
You've been there, right? I feel you, friend.
So when that happens to a normal TA/Recruiting function, how do they react?
2--The normal TA/Recruiting Department goes into battle mode with the order to get a big chunk of the jobs filled each month. But remember that normal TA shops are designed to knock out a normal amount—not a peak amount—of positions every 60 days.
3--Let's say you're dealing with that six month backlog and your TA/Recruiting Team is running at 150% capacity—hero time in the recruiting function. How long does that mean it takes your TA/recruiting team, running hot, to work through a 4-6 month backlog that pretty much got opened all at one time? Well, it's not 60 days, because the company wouldn't let them hire up to get ready. At the end of the day, great/hero/epic TA/Recruiting performance works through this COVID-like backlog in 3-5 months, depending on staffing levels. It's just math related to resources they have vs what the business threw on them. Nobody's to blame, but everyone's involved in the solution. Patience is required.
4--That means that a TA team dealing with a COVID-related backlog is operating at SUPERHERO levels if they are dispatching 1/3 of that backlog a month and doing very well at 1/4 of the backlog dispatched per month. That means it takes them a quarter or more simply to get back to normal, and that assumes the position volume dump gets back to normal. Show them some love at these levels.
Got it? Cool.
Now, let's compare that valid expectation of a crisis mode TA/Recruiting function kicking ass with what the economy just delivered:
--The Post-COVID dump of open positions: 7,000,000 (This is the economy acting like starved hiring managers.)
--The economists' expectation of what would get filled, aka the monthly target: 1,000,000 (at this rate, the backlog gets taken care of after 7 months, so seems like a low expectation, but we'll count it as reasonable based on the whole economy, what I laid out above, and the fact many are desperate for candidates.)
--What the market delivered: 266,000!
--Time to remove the backlog in TA/Recruiting terms at that pace: 26.3 months. W.T.F.
Yeah, that's a problem. To say nothing of the fact that the economy is not going to stop opening jobs—kind of like your hiring managers.
THE BOTTOM LINE IS THIS: Policy matters. We talk all the time about whether to add sign-on bonuses and other features to make our hiring more successful. But you can't have incentives (COVID-based unemployment benefits) that go against people reentering the work marketplace and expect better results.
The situation will improve. States are already moving to eliminate their COVID-related unemployment benefits, and the federal benefit runs out in September.
But, this is for sure: if the policy and the folks who ran it were a TA/Recruiting department leader, they'd be under the gun to make sure April's performance level didn't happen again.
You forgot about President Biden's big threat that folks better accept the job they are offered or he's taking their benefits away! Unless! Unless...you just say, I'm concerned about COVID, then you can have all of your UI benefits back and forget what I just said about accepting a job!
Ugh...get used to having hiring be very hard for an extended period of time.
Posted by: Tim Sackett | May 12, 2021 at 02:17 PM
I've been in HR for 20+ years but unemployed for 2. I have been actively looking for those two years and am so incredibly thankful for the UI benefit safety net. As a mid-life professional competing with Millennial talent for roles, I cannot even get a phone screen, so there's no "turning down jobs". I can't tell you how many times I've been told to expect an offer to only be ghosted. One headhunter texted me (that's right; no call, just a text) that they went with another candidate for an HRD role after I invested hours on interviews, research, & commuting -- not to mention the emotional investment. It takes its toll, especially in a pandemic.
My personal experience may be an outlier, but I really call bullshit on this whole argument that UI benefits are keeping workers from accepting jobs. Daycares are not able to operate at 100% capacity. Many working parents cannot leave their kids to return to the office. Not all schools are at 100% either. This false flag about UI benefits is simply a way to not address the child care crisis we have in this country.
Posted by: Lisa | May 12, 2021 at 03:27 PM
Lisa - Do you recruit? If so, send me your resume, because we are hiring. Serious, not being a wise guy.
Posted by: Kris Dunn | May 12, 2021 at 04:22 PM
Spot on analysis of the current jobs/hiring marketplace and the varied factors that are going to make this recovery a challenge. Until we get some of the hurdles out of the way that are impediments to service industry hiring (enhanced and extended UI benefits, inconsistency of COVID related open vs close restrictions, occupancy rules for restaurants/bars to name a few), there will be a reluctance on the part of many job seekers to actively pursue employment. Especially if they know they can ride the wave for awhile and the jobs will still be there in 60-90 days or more. I feel for small business owners that want to be open at full tilt levels but still can't due to govt restrictions or the inability to hire staff. Strange times we are living in!
Also for Lisa - if you have a recruiting or total rewards background, I am adding to my team as well. Would love to talkl!
Posted by: Bryan Schreiber | May 13, 2021 at 11:52 AM
Where is jobs, where is carrier ?? lives matter not money. I think after 2021 the situation is in under control .
Posted by: Garden Decor | May 14, 2021 at 05:41 AM
The benefits were out in place to offer financial aide to those not able to work for health hindrances. People died very close to us. We, the citizens in every country did not cook us this virus. We didn’t plan to have our health/ lives snatched by a molecule transposing everyone’s daily living. Why isn’t it okay for government to take care of its citizens for as long as needed to stop the deaths across the world. We all lost soo much and it’s not a game. This is our lives being jeopardized in so many ways. We were played and that’s on but it’s not ok for us to stay home. Bullshit!!! I’ve been employed since I was 14. Never took fro government until now at 66. How could anyone imagine that the businesses are still running bk to full capacity? One of best restaurant here , is still not running to full and those people were waiters waitresses in high dollar restaurant. So many small businesses just can’t make it bc business has not returned
This article doe t know real live people’s struggles. How about the lack of transportation across country. The farm labor was not able to work with Covid but were forced bc they needed their jobs.
Why is it that those responsible in society get accused of those that are doing wrong and are leeches in the system.
We’re not all stamped out if the same mold
HR doesn’t have a clue in any company I’ve worked. Get out in the field and learn what’s real
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Posted by: Hiresmart | June 07, 2021 at 02:14 AM
I don’t believe people would rather sit home. I’m so exhausted being home. I literally get unconsciously edgy when I have to go anywhere. I haven’t been out in a year except to go food shopping once a month. I’m a Nanny and love my career but am leery of going into anew place of residence with new family bc my immune is bottom of the barrel. I’m thinking about beginning a home business. They can bring to me. Looking for work. Going to Career Center to begin search before I go stir crazy. Good luck to all in businesses and hob seekers.
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Posted by: Manpower Consultancy | July 31, 2021 at 03:56 AM
As Covid restriction gradually open up, the need for recruitment will rise, especially after a long pause in many economic sectors. It’s best to really find ways to start the recruitment process, ease it in, and jumpstart the economy again. Unemployment benefits may work for a while, but most workers will choose an actual job that lives on benefits. People are active organisms and will thrive better in an active society than one in lockdown.
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