In October’s Hiring Pulse, we noted the huge rise in total payrolls in September to the tune of 336,000 in the United States.
Meanwhile, in the UK, total payrolled employees hit 30.2 million in October – a new high for the country.
October in the US, however, sees a slowdown to 150,000 new jobs, slightly below projections but not wholly unusual, say economics.
With that perspective in the two biggest English-language job markets, let’s look at the three major hiring metrics and see what else we can learn.
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!
The three main highlights for this month’s Hiring Pulse are:
- TTF is on the rise again after a long period of steady decline
- Small businesses are hiring more than their mid-sized counterparts
- Candidates per Hire continues its meteoric rise
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 October 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 October against the average of 2019, based on jobs that have been filled:
Things are looking a little different now on the Time to Fill front, for the first time in a long while. Look at the data starting in January 2022 and just draw a line from there to the TTF metric in mid-2023. What does that line look like? It’s a very clear downward trajectory, especially this year from January 2023’s 91.0 to May 2023’s low of 80.4.
Since then? It’s not only stabilized over the next few months from May through to about July/August – it’s actually rising. The line from July 2023’s 82.6 to October 2023’s 85.0 may not initially look like a big jump in raw numbers, but it’s an indicator when you look at it from a historical standpoint. In the recent past, we’ve only seen similar upward trajectories in TTF in September-November 2020 and March-September 2021.
With the exception of past Januarys (where a monthly jump in TTF is wholly normal for that month every year), it’s been a consistent decline nearly every month in the time it takes to fill positions – right up to Q3 2023.
Last month, we called this a “non-story”, because we considered this to be mere blips in the bigger picture of the TTF radar, but now, this is worth paying attention to.
Why? It’s not only the first time we’re seeing a steady (albeit modest) increase in the metric in recent months, it’s also inconsistent with this time period in previous years:
See how 2023 trends up while the others go down? Keep this in mind as we move on to the other two metrics – which may give us more insight into why this is happening.
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 October.
All that talk of a “September Surge” last month is continuing into October in our data for job openings. While September saw an increase of a full half-job per company on average from August, we see another increase to 8.2 from September’s 7.9, making October the fourth consecutive month of MoM increases in job openings.
When we get down into the size buckets, enterprise-level companies (those with 200+ full-time employees, or FTEs) maintain their undulation in the job opening trend, this time jumping up again to 17.3 new job openings per company on average for October, a .7 increase from September.
Mid-market companies (51-200 FTEs) didn’t show as much activity, dropping to 5.9 job openings on average from 6.2 the previous month.
The real story, again, is in the smaller businesses (1-50 FTEs). Not only did their robust recruitment activity continue into October with 6.8 job openings on average compared with 6.5 in September, they’re actually more active than their mid-market peers.
Think about it: companies with fewer than 50 full-time employees are hiring more than companies with up to four times as many FTEs – and actually, it’s significantly more: 6.8 compared with 5.9. Almost a whole extra job on average.
So, we talked about looking at JOs as a potential insight into the recent increase in TTF – perhaps those small businesses don’t have a dedicated HR team or, perhaps, a small squad with limited bandwidth. It takes a little longer to get that job filled than it might take for larger businesses who have the luxury of a full-time recruiter on staff.
Keep that in mind as we look at the Candidates per Hire metric.
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 October:
Another new high this month. With monthly adjustments in place, the Candidates per Hire metric now stands at 185.9 for October, a sharp increase of 17 points from the modest (and anomalous) dip in July 2023. It’s also a 62.4-point increase from January’s 123.5.
Just to call out the obvious: that’s a pretty big jump in a short time.
No need to beat around the bush again with fancy insights or even everyday vernacular on the data. Candidates are applying at a breakneck pace, and there are several factors for it – job loss throughout the year and AI-supported applications playing big roles.
What’s going on here?
The big story this month isn’t ultimately in the CPH increase – that’s basically expected at this point and has been discussed aplenty in past Hiring Pulses. What’s most interesting is the reversal of the TTF metric to an upward track.
When combining the three metrics above, it’s pretty clear that the more robust hiring in smaller businesses combined with that huge CPH spike means those resource-strapped smaller teams have a tougher time going through such a high number of applications in the same amount of time as before.
Think about it from an HR standpoint – or better yet, as a hiring manager who doesn’t even have the luxury of an HR professional to help you out. You open a new job for a marketing manager, and you’re slammed with a hundred applications on the very first day.
And then in the next few days, that number doubles to 200. Your plate is already full with day-to-day work and meetings and, well, that’s why you need that new manager in your team so you can start delegating.
So, you spend evenings looking through the applications. Yes, the data shows that employers spend an average of six to seven seconds looking at each resume – but that’s likely a scary headline to catch the attention of desperate jobhunters.
Let’s adjust that number to 20 seconds per application. Even at 20 seconds per review, going through 200 applications takes more than an hour of consistent, unwavering, dedicated attention.
But, by gosh, you’ve been able to do it over the span of a few days. You’ve whittled that list down to 20 very interesting candidates.
You’d like your HR professional to screen them – or in the absence of such, you send automated one-way Video Interview requests to each of them with a turnaround time of three days.
That brings us down to, say, six outstanding candidates after a few weeks.
If you’ve hired in your career, you know the drill. There are assessments, second interviews, follow-up communications, executive interviews, internal meetings, background checks, the whole shebang. It does take time, especially when you’re managing it solo.
If you smelled a shameless plug coming, then you’re right. Not only does Workable have a top-rated, plug-and-play recruitment software designed for ease of use, it also has Free Tools for Managers – true to its name, it’s a cost-free tool for hiring managers to use when tight on budget and tight on resources. Give it a whirl right now by entering the job title and industry and watch the AI-driven magic unfold.
You may also find that it’ll help optimize your hiring processes and even bring your own Time to FIll down.
Enjoy, and 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.