Your Hiring Pulse report for August 2023

In July’s Hiring Pulse, we highlighted the staggering increase in the number of candidates per job opening – and it really is very high. This month, we look at relatively similar metrics, but we also try to draw some new context around it all.

Let’s have a look.

How we’re looking at data

We’ve adopted two methodologies in how we look at the Hiring Pulse dataset. For Time to Fill and Candidates per Hire, we’re measuring each month using the average of 2019, the last “normal” year, as a baseline index of 100.

For job openings, we’re taking a different route – simply, the average number of job postings per company. This gives us the opportunity to gauge overall recruitment activity and whether that’s going up or down.
Want a more detailed methodology? Jump to the end and check it out.

As always, we look at the worldwide trends for three common SMB hiring metrics:

• Time to Fill (TTF)
• Total Job Openings (JO) 
• Candidates per Hire (CPH)

Let’s start analyzing!

Main highlights

The three main highlights for this month’s Hiring Pulse are:

• Job activity is taking a bit of a dip – one half job less on average per company in July compared with June
• Candidates per Hire is still at a very, very high level
• Time to Fill is more stable than it normally is over a longer period

1. Time to Fill

For this report, Workable defines “Time to Fill” as the number of days from when a new job is opened to when that job opening is filled. It’s important to understand that definition: jobs that are still open as of the end of June are not included in this graph as they don’t yet have an “end date”. Only the jobs that are filled are included here.

Quick clarification, because people are asking: the data in this chart shows the trendline against the 2019 average as an index of 100, not the actual number of days in TTF.

Got that? Good. Let’s have a look at the monthly TTF trend through to the end of July against the average of 2019, based on jobs that have been filled:

We want to have a story here, but there’s not much to tell. Ultimately, July’s TTF trend sits at 82.6, which basically marks the fifth consecutive month of relative stability where it hits 84.3 at its highest point and 81.2 at its lowest point.

But you deserve an insight here, so here’s one: looking at last year, we see the same trend where the TTF trend hovered between a high of 93.2 and a low of 90.8 over an eight-month stretch from February to September 2022 before finally dropping to the higher 80s for the rest of the year.

These two time brackets are actually the most stable the TTF trend has been in our dataset dating back to the start of 2020 – apart from a few three-month stretches here and there, it’s been a regularly undulating trend month-to-month over the past three and a half years.

Let’s move on to Job Openings now.

2. Total Job Openings

Total job openings represent the total number of job openings activated across the entire Workable network.

As stated above, we’re displaying this as an average of job postings per company in the network. And because this is not contingent on job opened/filled dates like TTF and Candidates per Hire, we can simply look at the raw job open numbers up to the end of July.

The big takeaway this time is the drop in job activity from June to July this year, where average job postings across all companies fell from 7.6 to 7.1. At first glance, this may not mean much considering the regular ups and downs in job postings over the last few years, but what makes it significant is when we look at the June-July shifts in previous years.

As it happens, 2019 and 2020 saw nice bumps in job postings in the Workable network – increasing 0.5 in 2019 and 0.6 in 2020 from June to July. In 2021 and 2022, there was literally zero change from June to July in the trend – the average remained absolutely stable.

So, in this context, we now see how a drop of half a job in the job opening average from one month to the next is significant at this point in the year. And we see this happening across the board regardless of the company size bucket.

Now, let’s look at the Candidates per Hire trend.

3. Candidates per Hire

Workable defines the number of candidates per hire (CPH) as, succinctly, the number of applicants for a job up to the point of that job being filled. Again, remember, this is a trendline using the 2019 CPH average as a baseline of 100, not the actual number of candidates per hire.

Now that Let’s look at what’s going on here through July:

The Candidates per Hire trend has been a focal point of the last few months because of how much it’s increased since January.

While not an increase this time – and actually a decrease from June’s all-time high of 176.6 – July’s 169.2 is still right up there in the rarefied atmosphere as the second-highest monthly trend in the history of Workable’s network data.

Except it’s starting to feel like it’s not such a rare place to be – and rather, it’s normal. When you have the last four months (158.5, 140.3, and now 176.6 and 169.2) standing so much higher than anything preceding it, then you have to wonder: will this trend continue as is? Will it keep trending up? Will it fall back down to a previous baseline?

The problem we have here is that, unlike in the other two metrics we regularly track in the Hiring Pulse, we have nothing in the past to compare this recent surge in Candidates per Hire. Let’s call it what it is: a surge. Let’s watch this space and see if we can answer the questions above.

What’s going on here?

Job openings are taking a bit of a dip. Candidates per hire are also taking a very, very small dip but still at a remarkably high point. In last month’s Hiring Pulse, we noted how both job openings and CPH were on the rise and that this indicated a crazy busy time in the hiring landscape – especially for small businesses with low-bandwidth hiring teams.

Now, it’s still busy. The job openings may be taking a small dip, but companies who announce a new opening in their company will still get inundated with candidates. Consider this: let’s say you got 100 candidates for a job opening at your company at this time last year. Now, for that same job, you’d get 178 candidates according to our data.

That, right there, is the biggest difference and that’s the way it’s been going for months. We’ve bounced all kinds of hypotheses around on this topic, and we’ll bring in a new one: remember the Great Resignation? Quit rates are still relatively high – but they’ve come down quite a bit from the times when we saw more than four million job quits per month in the United States for 19 successive months from June 2021 to December 2022.

In the six months on record in 2023, it’s gone above four million just once, in May – although it did come close in February with 3.98 million quits.

For June 2023, that number has dipped to 3.772 million quits – the lowest it’s been since March 2021.

Now, our theory: when candidate numbers were coming down and quits going up, no one was able to come to a clear consensus on where these people were going if they weren’t going to new jobs. We’ve speculated in the past that they either moved to freelance and contract work, started their own businesses, took on sabbaticals, or something else that wasn’t readily trackable.

It’s possible that those workers who dropped out are returning (or trying to return) to the full-time fold. They’ve tried out the life of Riley and either decided it was time to return or it just didn’t work out the way they hoped it would. Couple that with the increase in layoffs, and you have an abundance of new candidates applying to open roles.

That’s your food for thought for August. See you next month!

Thoughts, comments, disagreements? Send them to [email protected], with “Hiring Pulse” in the subject heading. We’ll share the best feedback in an upcoming report. Watch for our next Hiring Pulse in May!

The Hiring Pulse: Methodology

Because one of the three metrics (Job Openings) is different from the other two metrics (Time to Fill and Candidates per Hire), we’re adopting two very distinct methodologies.

To bring the best insights to small and medium (and enterprise-level) businesses worldwide, here’s what we’re doing with the Job Openings metric: we’re taking the number of job openings in a given month and dividing that by the number of active companies in our dataset, and posting that as an average. For example, if July 2022 shows the average Job Openings per company as 7.7, that simply means each company posted an average of 7.7 jobs that month.

For the Time to Fill and Candidates per Hire metrics, we’re comparing a specific month’s trend against the full average of 2019, and we show the result using that 2019 average as a baseline index of 100. For example, if July 2022 shows an average Time to Fill of 30 days for all jobs, and the monthly average for all of 2019 is 28, we present the result for July 2022 as 107.1 – in other words, 7.1% higher than the average of 2019.

And we chose 2019 as the baseline because, frankly, that’s the last normal year before the pandemic started to present challenges to data analysis among other things.

The majority of the data is sourced from businesses across the Workable network, making it a powerful resource for SMBs when planning their own hiring strategy.