The U.S. economy is entering what many experts are calling a recession. As such, businesses across the country are bracing for impact. One of the most significant ways a recession will affect businesses is through hiring. In fact, research from the last recession shows that companies started shedding jobs an average of 19 months before the recession officially hit.
Given that history repeats itself, it’s safe to say that we can expect similar numbers this time around. So, what does that mean for those of us in charge of hiring? Well, it means that, in an industry that is already challenging, like Legal, we need to be proactive about how we approach recruiting and staffing during this time.
Here are four things to keep in mind as you navigate these challenging times:
1. Job Seekers will be choosier about who they work for: In good economic times, job seekers have more options and can be more selective about where they work. But in a recession, workers will be more likely to stay put at their current jobs because they know it’s harder to find something new. That means they’ll only entertain offers from companies that are truly a step up from their current situation.
2. There will be more competition for top talent: Even though job seekers will be more reluctant to leave their current positions, that won’t stop companies from trying to lure them away with competitive offers. In fact, there will likely be even more competition for top talent because good employees will be in high demand. Businesses will need to be extra thoughtful and strategic about how they approach recruiting so they can land the best candidates.
From a talent perspective, employers should anticipate an increase in flight risk and focus on building pipeline and succession plans accordingly,” said Rajeev Peshawaria, CEO of Talent Sigma and author of Too Many Bosses, Too Few Leaders. “During an economic downturn or recession, your top performers become even more attractive to other employers, so you need to have measures in place to keep them engaged and motivated.”
3. You’ll need to get creative with your recruiting efforts: Since budgets will be tighter during a recession, you’ll need to get creative with your recruiting efforts, so you don’t break the bank trying to land top talent. One way to do this is by leveraging technology like social media and video conferencing platforms—both of which are cost-effective ways to reach a wide audience of potential candidates. You can also use employee referral programs as a way to tap into your existing network of contacts and identify high-quality candidates who might not otherwise be on your radar screen.
4. Employee Retention will be crucial: While it’s important to focus on recruiting during a recession, it’s just as important—if not more so—to focus on employee retention. After all, it costs significantly less money (an estimated 1/3) to retain existing employees than it does to recruit and train new ones. Plus, when times are tough, businesses need “all hands on deck”—which means hanging onto your best talent is more important than ever before
Because hiring during a recession can present unique challenges, it’s important for businesses to take a proactive approach. By being mindful of the effects a recession can have on hiring, you can set your company up for success during these challenging times. Even though an economic downturn can seem daunting, remember that it also presents opportunities for businesses that are willing to think outside the box. When it comes down to it, the key to weathering any storm — recession included — is preparation.
So, start preparing now and you’ll be one step ahead of the competition when the next upswing hits. Which it will.
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Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by my employer, my partners or my clients. eDiscovery Today is made available solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscovery Today should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.