Your Hiring Pulse report for July 2023

In June’s Hiring Pulse, we pointed out how ChatGPT and its AI cousins are impacting the job landscape, and that the stabilization of candidate numbers could be due to an increase in job postings.

Well, this month, we have some eye-opening data for you that blows some of that out of the water. Let’s get into it.

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 back to high levels – especially for the largest and smallest companies
• Candidates Per Hire is at a whole new level
• The Time to Fill metric is the only one that’s relatively normal

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 June against the average of 2019, based on jobs that have been filled:

Last month, we pointed to relative stabilization in the Time to Fill trend especially compared with the steep drop seen in the first quarter of 2023.

Q2 tells a somewhat different story – April saw an uptick to 83.3 from March’s 81.9, with that trend dropping to 80.8 for May. And now, in June, it’s risen again to 84.

The question is: how anomalous is this? The answer: not unusual at all. Look at how 2021, 2022, and 2023 compare in the same chart:

With some minor outliers, these all follow a relatively similar trend – a steep drop-off from January to March followed by relative stabilization and a mild uptick to June.

The only thing that’s clearly different is that the Time to Fill trend is lower this year than in previous years. Jobs are getting filled quicker than before.

We’ve gone into a multitude of reasons and theories as to why – but for this month, let’s get to Job Openings and then, especially, to Candidates Per Hire which is where the real story is (yes, again).

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 June.

Again, we see a bump in job activity, this being the second straight increase from the previous month from 7 new job postings per company across the board in May to 7.6 for June.

We’ve been at 7.6 before, in March, but what’s worth noting is that in the 18 months since January 2022, we’ve seen the average number of job postings per company go higher than 7 just four times, and three of those happened in the last four months.

There’s been a lot of talk (including in the Hiring Pulse reports) about recessions and AI impacting jobs. We’re surmising here that the impact is more in how jobs are changing rather than dwindling. New gaps and opportunities are being discovered, and new jobs are created as a result.

Now, look at the company sizes that are seeing the biggest jump in job activity. First, the big kids on the block (enterprise-level, 200+ full-time employees) are opening up more jobs over the last two months than the previous month before that – from 16.6 job postings per company in April to 17.5 in May, then 18.2 in June. If you look at 2022, you’ll see that job activity for that size bucket was higher although declining, while this year, it’s lower but rising.

Now, let’s look at the small kids on the block (>50 FTEs): they’re up to 5.8 jobs per company in June from 4.9 in May. That’s an increase of nearly one full new job posting per small business on average within a month.

We did a bit of math last month and let’s do it again: let’s say an average company in this size bucket has 30 full-time employees.

When you see the average of 4.9 new job postings for May, that’s more than 16% of that company’s entire workforce, or one in seven.

And 5.8 is 19.3% of that entire company’s workforce – nearly one in five.

Think about your own company, if you’re in a smaller one. Look at the people around you (or look at the faces on your laptop screen, if you’re working remotely). Imagine one in five of those people being new within the last month, or that you’re seeing one in five of those people leaving. That’s not an insignificant number for a small business. Hiring is very active in this bucket.

Now, let’s look at the candidates. Yes, we promised a good story, and you’re getting it now.

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 June:

We didn’t think this was going to happen, but there it is – the Candidates Per Hire trend has just surged. The CPH trend is now at 176.7 for June 2023 (or 76.7% more candidates per hire than the average of 2019).

It’s absolutely at its highest point in, like, ever. To further demonstrate how high this is, let’s compare June’s CPH using 2020, 2021, and 2022 as benchmark averages:

In short: where candidates per hire for June 2023 is 76.7% higher than the average of 2019, it’s 50.2% higher than the 2020 average, 67.4% higher than the 2021 average, and 70.3% higher than the 2022 average. No question about it – June is very, very high no matter what year you compare it against.

We’ve talked aplenty about the many different reasons why, and we encourage you to go to previous Hiring Pulses to better understand this trend. Right here, we’re just going to recognize that if you’re getting slammed with candidates every time you open up a new job, you’re absolutely not alone.

What’s going on here?

Job openings are up, quite significantly, especially for small businesses. And the CPH trend is, of course, at previously unseen levels. Last month, we noted the drop in new job postings and the rise in CPH and wondered if the two were related.

In this case, we’re seeing a significant rise in both. The hiring landscape is just so very, very busy. There are just so many candidates for a single job – it’s like opening a leak in a dam and having the water just come rushing through.

When a lot of that activity is happening in smaller companies with fewer than 50 employees, you can imagine the stress on those hiring teams – smaller businesses don’t have the luxury of a full HR team that can dedicate themselves to the job.

An executive in a small business can often be the hiring manager for a job – and may even themselves be the recruiter, the background checker, the assessor, the evaluator, and more.

And doing this across the company for multiple jobs (remember, nearly one in five employees per small business as we stated above) while at the same time trying to run a business – it can be a lot to pack into a day. That’s where software (cough cough) can be pretty helpful.

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.