Candidate shortages have been a very hot topic for the past two years. If you have been involved in hiring, this is not news to you. But what may be news to you is that this situation will not be changing soon, even with a recession. Unfortunately, we will remain in an environment where there will be candidate shortages for the indefinite future.
Facts Are Stubborn Things:
On November 30th 2022, Federal Reserve Chairman Jerome Powell said this in a speech to the Brookings Institute: “Comparing the current labor force with the Congressional Budget Office’s pre-pandemic forecast of labor force growth reveals a current labor force shortfall of roughly 3-1/2 million people. This shortfall reflects both lower-than-expected population growth and a lower labor force participation rate.” (FederalReserve). In short, what he is saying is that we have not produced enough people to replace the people who have retired.
My argument to the employers is simply this, do not expect to see a large number of unemployed individuals popping up to apply for open positions all of a sudden. It is highly likely we will see more applications, but we will not see the flood many employers are expecting. According to a Lightcast report, the United States is expected to see a deficit of 6 million workers by 2028. (Sansdemic). While I wish I could give employers better news, the reality of today is that all this data tells us the candidate pool is small, competition is fierce, and we do not have anything on the horizon that will change this situation, even with a recession.
We may not like the data as presented to us, but the unfortunate reality is that generally speaking those people who want a job today, have one. When you look at the March unemployment rate in the Tampa Bay area, we are sitting at a very strong 2.5%. Again, generally speaking, the people who want a job are largely employed today.
There Are Still Great Candidates Available
I want to step aside and talk to the people who are unemployed and struggling to find the right employment. I hear you, and you are not alone. One of the biggest challenges in the market today is getting employers to bend in their expectations for employees. Employers are, more often than not today, looking for perfection instead of great people. When this happens, inevitably there are great potential employees who have been overlooked or passed by because they did not fit the “perfect” mold for the role the employer wanted.
For some of you, this struggle is real. You really have the talent, background, and skills to be hired for a role today, but you aren’t gaining any traction with an employer. I wish I could give you a secret password to make it different. All I can tell you is that to the best of your ability, deal with what you can control. Unfortunately a company making a decision on your hopes and dreams is one that you unfortunately can’t control.
However, for other candidates this is a time for some self reflection. If you have been only looking for a remote role, or only looking for a job in a certain wage range and you are not being successful, now is a great time to reassess your priorities and the market. I am not saying you must change, but similar to what I am saying to employers, now is a great time to become more flexible.
Important For Employers To Know
When recruiters like me reach out to potential candidates to explore the possibility of changing roles, the overwhelming response I see centers around career growth and salary increases. Granted, depending on the role, we also hear from people who want remote work, but often times those people will bend if the wages/career growth or professional situation (hybrid/remote) are attractive enough.
While the above has been true for the past year and a half, I will say there is a caveat to it. As a potential recession looms, make no mistake that your employees are paying attention. If they think your business may be laying people off or struggling, they will be gone in a hurry. At this point, your employees are looking more for stability and safety, at the same time, they also want wage increases and career growth. We are all walking a tightrope right now.
However, there is one point I believe to be absolutely critical for employers to understand: Your culture does not matter as much as you think it does. It may help candidates validate their decision to join you, it may help retain people who are considering leaving, but if your wages (or career growth) are not meeting the expectations of your employees, your culture is not relevant.
Important For Candidates To Know
For the past two years candidates have been essentially calling their shots. They can, and have, dictated the parameters by which they will accept a new role. The better the candidate appeared to the employer the more likely it was they got just about everything they wanted.
Even with the lack of candidates, I see this situation changing now. Especially in the small business market. We are seeing more businesses hit their breaking point and standing fast with their current wages or work situations. Due to economic conditions, we are seeing businesses become stricter in their hiring parameters. They are less willing to adapt or modify they budgets for candidates. They are more comfortable allowing positions to stay open for longer periods of time.
Employers really aren’t much different than candidates today. In the face of growing inflation, a potential recession, and slowing orders, they are being more cautious in their hiring. They are mostly interested in finding the right fit and if that person is not found they are willing to wait.
Ultimately, our goal is to help employees find better career opportunities. In turn we want to help companies continue to improve their businesses. We want to work with value-based businesses and career focused individuals so we can help our Tampa Bay community grow. To keep up to date on the current employment situation in Tampa Bay, subscribe to my once a month blog on LinkedIn: Tampa Bay Employment Snapshot
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