So, we’re addressing your top concern of filling the roles you need to fill, and filling them quickly. Minimizing turnover is, of course, a grave concern as well.
We know that data benchmarks are important to you when recruiting in the SMB world. If you’re finding X number of candidates applying to your open roles, is that normal in your area? If you’re taking Y days from job posted to job filled, is that something others are experiencing as well, or is that something you need to improve? And so on.
To help you, we’re taking a fresh approach to hiring data to support you when you analyze your own numbers.
How we’re looking at data
‘Normal’ doesn’t really exist anymore, even if it is a ‘new normal’. Looking at the data YoY or even MoM is a flawed study because of the regular fluctuations in the data over short periods of time. So, instead, we’re looking at rolling trends. This means we’re showing data as a percentage increase or decrease when compared with the rolling average of the past three months. Jump to the end for a detailed methodology on this.
As always, we look at the worldwide trends for three common SMB hiring metrics:
- Time to Fill (TTF)
- Total Job Openings
- Candidates per Hire (CPH)
And we dive deeper by looking at the data in selected job functions to see how the data differs in each. Now, let’s start crunching away!
Table of Contents:
The three main highlights for December’s Hiring Pulse are:
- Time to Fill is still dropping steadily
- Job opens are negatively trending for the first time in awhile
- Candidate availability is once again trending sharply downwards after a modest recovery the month previous
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 that we understand this distinction with this graph updated to September: if a job is opened in October or even as early as March, but isn’t filled until November, it won’t count in this graph’s dataset. If another job is opened on the same day in July or March but is filled on the last day of October, it does count in this graph.
While this measurement strategy partially explains the downward trend in recent months, we’re going to sidestep that for now, and see how the trend in the latest data compares with last month’s and see how they compare.
So, let’s start with a look at the new graph updated to October:
What we see here for the Time to Fill trend is -26.4% for October compared with the previous three-month average. That’s compared with -29.6% in the last month trend of the same chart from November – suggesting that TTF is slightly longer this time around.
But is that really indicating anything? Probably not. Numbers have a habit of jumping and falling, like the stock market. What we want to point to, instead, is the consistent nosedive in the TTF trend – last month, it was four consecutive months of negative trends, and now it’s five straight months where the latest TTF data is shorter than the previous three-month average.
Employers are continuing to hire faster than before, with only two of the last 10 months showing TTF on a positive trend, and even where the trend turns positive, it’s barely at all – just 1% in April and .9% in May.
Last month, we went into a thing about how this is a good thing for employers because they’re succeeding in finding and hiring the right candidates for their open roles – and doing so quicker than before.
But you know what? We’ve also heard anecdotes from businesses that they’re just plugging holes quickly in an attempt to stem the increasing flow of quits (watch for an article on that soon). Perhaps it’s not that employers are finding the right candidates quicker than before – it’s more that they’re just grabbing anyone who walks in the door and saying, “You’ll do. Can you start on Monday?”
We also pointed out last month that candidates are moaning about the long recruitment process. This may be the answer to their grievance. But if employers are just trying to fill job holes with “good-enough” candidates, that may lead to a poorer employee experience all around as newly hired employees realize they’re not a good fit for the role or company after all – a consequence of not putting enough thought or care into the employee selection process.
2. Total Job Openings
Total job openings represent the total number of job openings activated across the entire Workable network.
So, let’s look at the raw job open numbers – which aren’t contingent on open/close dates, so we can include November in this chart:
Look at that. A negative trend of -2% for the month of November, the first time since December 2020 that we see a negative trend in job openings. It’s not much, but it does indicate something when it’s more than a six-point drop from September’s 4.4% and October’s 4.1% trends.
Questions abound: perhaps employers have hit the ceiling in terms of how many jobs can be opened. Then again, the Great Quit / Big Resignation / Huge Whatever remains at unprecedented levels – at least according to the US Department of Labor (DOL) up to the end of October.
Is this -2% trend in the Workable network in November a prediction of lower job quit rates according to DOL once they release their own numbers in January? We’ve found that the trends for DOL and Workable network data do align throughout the year, so the answer is very potentially yes.
We won’t know for sure until January, but it’s worth keeping an eye on.
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.
Let’s look at what’s going on here through October:
(NOTE: Again, as in the TTF chart, you’re probably wondering why we stopped the numbers in September. Again, as stated above, that’s because these data are based on the time the job was opened, not when it was filled.)
Last month, we pointed to what we called “modest recovery” in the September CPH trend from a 2021 low of -16.6% in August.
But that’s changed significantly in October, which shows a staggering 26% drop in CPH compared with the previous three-month average. All that blather last month about CPH not trending downwards as much as before is now obsolete. This -26% metric marks a brand-new low for all of 2021 – and even 2020 for that matter.
Maybe candidates really are at a premium after all.
What’s going on here?
Last month, we shared the explanation that candidates are more deliberate in their applications than before. They’re no longer throwing applications at the wall to see what sticks. There’s a wealth of opportunities for candidates and greater emphasis on a job that’s more suited to their priorities. So, they’re more selective in applying for openings.
SHRM points to the shifting supply and demand of the job market as a factor, as well as extended benefits going into September that gives them this luxury. But we maintain that, even in a ‘normal’ job market, candidates are feeling more emboldened in landing the perfect job they want. They’d rather go without a job than take on a ‘meh’ job that doesn’t do much more than pay the bills, and they’re willing to tough it out to get there.
And that insight of this month’s Hiring Pulse challenges you, the SMB employer, to rise up and meet those increased expectations of the jobseeker. Grabbing the first candidates as they walk in the door because “they’ll do, if they can start on Monday” may come back to bite you later.
If you want great candidates for your roles and you want them to stay with you, they are out there and they’re as interested in finding the perfect long-term arrangement as you are. With Time to Fill shorter than it’s been in a long while, it may be that you invest your time and resources into recruitment marketing and employee value proposition even before opening the job, if you want those superstars on your team.
4. Job function metrics
Of course, a business is not one single ecosystem. Different things happen in different departments and functions when the economy ebbs and flows, leading to different outcomes in the data even within the same organization.
So, with that in mind, we wanted to look at eight main functions in a business, some or all of which an SMB employer can relate to:
- Customer Service
- Human Resources
- Information Technology
And obviously because of the pandemic times, we decided to add the health-care provider function to the mix, just to see what that looks like against some of the others.
Time to Fill
First, let’s have a look at Time to Fill:
The obvious and predictable insight here is just how volatile the health care provider metric is. It’s an absolute roller-coaster of a trend, even in the latter half of 2021. It’s clear that with the volatility of COVID and all its variant offshoots, the need for health care jumps and falls.
As for the other functions, the TTF trend for IT is the lowest for October with a downward drop of -35.8% – and it’s also the fastest-plummeting trend across all functions in this chart (with August at -9.9% and September at -21.2%. IT workers are plentiful – and their skill set usually standardized, leading to quicker evaluation and a faster hire for an IT opening.
On the flip side, accounting / auditing sees the downward trend in TTF slowing down over the past three months (-26.6% in August, -21.9% in September, and -20.6% in October. Could it be that because we’re nearing the end of the fiscal year for many companies – therefore a sudden need for more number crunchers? The increased competition means accountants are being snapped up, leaving to unlucky employers taking longer to find fiscal talent.
Total Job Openings
Now, the job openings across these functions:
We’re seeing positive job open trends across all functions – with the most dramatic jump in Customer Service from -19% in October to 17.8% in November (perhaps due to increased shopping for holiday season?). Health care also spikes again from 1.7% in October to 27% in November.
But we really want to point out the consistent increase in the job open trend in Human Resources at 27% in November (from 1.4% in August, 8.3% in September, and 17.2% in October).
Why? The developments of 2020 and 2021 have also trickled into companies, with an increased awareness of DEI, emphasis on salary and benefits, remote work trends, increased compliance considerations, and higher turnover – much of this falls on HR’s shoulders.
So, it makes sense that employers would add to the HR payroll – and for SMB employers to make their first hire in HR earlier in their business tenure than previously.
Candidates per Hire
Finally, let’s look at Candidates per Hire across these functions:
The big change in CPH is, again, in the health care provider function, with a staggering 50% decline in the average number of candidates per job in October compared with the three previous months. Perhaps health care workers – bless ’em – are burning out and shifting their priorities in terms of work. Perhaps it means the function has stabilized and that there isn’t as much movement – or hiring – as there was before, meaning fewer candidates out there in the job market.
But then again, we know that job opens for health care providers is on the rise. That suggests that it’s more about the burnout and change in priorities than it is about stabilization. They’re leaving, but they’re not moving to other roles in health care.
Meanwhile, we also see an equally sharp decline in the CPH trend for those in accounting / auditing, from 41.4% in August to 24.5% in September to -11.9% in October. Above, we mentioned the increased demand for fiscal wizards as year-end budgeting looms; that may be the factor.
Those in marketing are also at a premium – going from .9% in August to -21.7% in September to -36.1% in October. Businesses recover and grow, meaning increased marketing spend, meaning more marketers are being hired? Perhaps; lots to talk about there as well.
We’ve mentioned in a previous Hiring Pulse that the onset of Delta would rock the hiring world. While it didn’t have the impact that March 2020 did, it did shift a few things. Now we have Omicron – but it’s still early to gauge what, if any, influence that will have right now. One thing we know: it’s normally flu season at this time, and COVID had a marked impact last year starting at this time, and people are bracing for a sequel.
We are also approaching the end of the year. As we delve into increased holidays for many workers and businesses, and therefore slowdown in processes and logistics combined with torrid consumer activity during the traditional holiday season. It’s also a fiscal crunch time for businesses who are thinking about plans for 2022 and doing a postmortem of 2021.
That spirit of a postmortem and thinking carefully about plans and strategy for 2021 also involves futureproofing. That’s what C-suiters and executives do – they look to maximize potential and minimize risk for as long a period as possible. Snap decisions will not do, even as businesses do look to be nimbler and more agile than ever before.
This mindset must also apply to recruitment in the SMB space. You can’t afford to make snap hires every time because, as stated above, it’ll come back to bite you in terms of turnover and workforce disillusion. It’s worse during tumultuous times. You need to build a stable ship – a strong, well-thought-out strategy that’s prepared for shifts and bumps in the road ahead.
When hiring, think like a strategist:
Do all that – and more – and you’ll find that this “Big Quit” may not be something to worry about in the long run.
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 January!
The Hiring Pulse: Methodology
To bring the best insights to small and medium businesses worldwide, here’s what we’re doing with our data: when looking at a specific month’s trend, we’re taking the numbers from that month and comparing it to the average of the three previous months – and showing as a percentage how that month looks in comparison.
For example, if July shows an average Time to Fill of 30 days for all jobs, and the monthly average for the three preceding months (April, May, June) is 25 days, we present the result for July as a 20% increase.
The majority of the data is sourced from small and medium businesses across the Workable network, making it a powerful resource for SMBs when planning their own hiring strategy.