Your Hiring Pulse report for October 2023

In September’s Hiring Pulse, we noted how a glut of candidates for a job posting isn’t so much of a luxury as it is a burden on employers. When you have more candidates, you don’t necessarily have the pick of the crop – more candidates means saturation, and points to desperation in the talent market.

But something interesting happened in the latest job report from the US Department of Labor – total payrolls in the United States grew by 336,000, which came as a surprise to many.

(Just in case you’re wondering – yes, some of those numbers in 2020 are literally off this chart. If you must know, March and April 2020 saw job losses of 1.4 million and 20.5 million respectively, followed by bouncebacks of 2.6, 4.6, 1.4, and 1.7 million for the four months after that ending in August 2020.)

There are many other surprises in store as well. Let’s look at the three metrics, and bring some fresh insights to the table. Ready? Let’s roll!

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:

• Candidates Per Hire is still on a meteoric rise
• Job postings are climbing rapidly, with a big chunk of that in small businesses
• The “September Surge” has data to show for it

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

At first glance, this looks like another month-over-month (MoM) drop – but look deeper, and you realize that it’s actually inconclusive. A change from 82.9 in August in the TTF metric to 82.6 in September is nothing to write a long letter home about. That’s really just a blip.

We talked a lot about stabilization in this metric in previous months – this shows more of the same. We’ll file this one as a “non-story” for this month at least – if for nothing more than to jump to the real stories in this month’s report.

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 September.

Now we are seeing some very interesting things here compared with previous months. Ultimately, the average number of job postings per company is up by a full half-job across the board, from August’s 7.4 to September’s 7.9.

What makes it more compelling is the drop in average job postings for enterprise-level companies (with 200 or more full-time employees) from 17.4 new jobs per company in August to 16.5 in September. That’s nearly an entire job less per company in September – which strikes us as odd because you’d expect the so-called “September Surge” (read on to learn more on that) to affect larger companies that follow a more consistent seasonal rhythm in their processes, including in budgets and employment.

So where is the job growth happening? At the other end of the size spectrum – small businesses (the 1-50 FTE bucket) posted an average of 6.5 jobs in September, up from 5.6 in August. That is a huge number – that’s a 13% growth in the actual employee base for companies that do have 50 employees.

And for companies with 25 employees – also included in this size bucket – bringing in six or seven new employees is going to have a pretty significant impact. It’s hard enough to run a smooth engine with your existing workforce – imagine onboarding and training a whole pack of new hires all at once when your existing teams are already busy doing their thing.

And, again, this is just the average for companies with anywhere from one to 50 employees. Some of these companies may be looking for just one or two new hires in the month, while others are hiring upwards of 15 or 20. And some of those companies may have just five full-time employees and looking to triple in size, while other, larger companies may not be hiring at all.

It’s a lot to unpack, to be sure. Now, let’s look at the CPH 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 September:

If there weren’t real people involved in this, we might say this is getting a little bit boring now. Every time we say “We’ve reached a new high!” or “We’re seeing a new normal in hiring!”, our dataset comes back and hits us with… another new high.

This time, the CPH trend has risen again, to 183.4 for September. That’s 83.4% more candidates per job compared with the average of 2019. And that’s 9.5 points up from just two months earlier.

Does this mean more and more people are out of work or returning from extended leave, or turnover is high? No, we won’t go with those theories this time. We actually have tangible insights which you can see in the next section.

Meanwhile, we can tell you that the industries most actively hiring *and* seeing huge CPH numbers are in SaaS, hospital & health care, and media & entertainment.

The sectors not quite seeing as many candidates despite posting a high number of jobs are in retail and consumer services. Great Resignation is perhaps still a reality for retailers.

OK, enough of that – let’s get into the conclusions.

What’s going on here?

September, of course, is traditionally a time to return to school, and also, the end of summer months. It’s ultimately a time for change for many people in our society.

LHH Recruitment Solutions head Laurie Chamberlin said as much. “I feel like September is more of a New Year’s philosophy than New Year’s … September is like back to school, back to work, back to ‘what am I going to do everyday?’ It’s like New Year’s for the workforce and education.”

“September is like back to school, back to work, back to ‘what am I going to do everyday?’ It’s like New Year’s for the workforce and education.”

Zapier recruiting manager Bonnie Dilber tells HuffPost that it’s also to do with the summer slowdown:

“Hiring slows down over the summer due to lots of vacation time for job seekers and candidates ― this makes scheduling tricky and can often lead to lengthier processes,” she says.

September, of course, marks the end of summer, and a “let’s get back to business” mode.

It’s also about budget, Laurie says,

“If there’s funds in their budget, that they’re not going to get the FTE add in 2024, but they have it in 2023, they’re looking to hire. If they’re looking at revenue, and they need [a] head count to make that revenue achievable…they need to onboard those people right now to hit their 2024 goals.”

That, in short, is the “September Surge”. This is the term given to the rise in job and jobseeker activity that traditionally happens in this month. Says Laurie: “I’ve been in the recruiting industry since ’99. And it is very real.”

We see this in our data as well.

This means you’re not only seeing more candidates coming through your hiring pipelines, but more competition in landing those A-list employees. So, you’ll probably want to understand what workers prioritize in a job right now so you can highlight those in your value proposition.

We did the homework for you. We asked 1,250 workers to understand their wants and needs at a high level, and the result is the Great Discontent for 2023. Give it a good read (both the US and UK versions), and incorporate what you’ve learned into your candidate attraction strategy.

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.