When Demand Ignores Supply

By Brittany Jones posted 07-25-2019 13:11

TechServe Alliance Sales & Recruiting Management Program Director
Founder/President Harvyst Consulting Partners

Think about these facts:
  • There is already a significant shortage of talent in the workplace (specifically in IT).
  • Every day, 11,000 more "Baby Boomers" retire (4,000,000 per year).
  • The unemployment rate is at 3.6% (lowest since 1978), Tech sector unemployment rate is 1.9%.
  • The US birth rate continues to decline (3.78M born in 2018) and is at its lowest rate since 1986. Couple this with 4.0M Baby Boomers leaving the workplace and the shortfall grows exponentially.
  • Nearly 50% of all hires fail within the first 18 months ("Dr. John Sullivan study - 2017")
  • Washington continues to limit entry into the US for work related visas.

And yet, companies continue to self-inflict hiring wounds. How?
  • By insisting on bill rates and salaries that are considerably below the going market rates.
  • By dragging out the hiring process to timespans that exceed the patience (and shelf life) of the most talented candidates.
  • By limiting access to those (i.e. hiring managers) who can best explain the "must have" skills and highlight the "nice to have" skills, which will ultimately expedite hiring decisions.
  • By failing to understand the cost associated with not filling jobs (yes, that is a real cost - lost productivity).
  • And finally, by not holding accountable those responsible for poor hires - both average performers (rating of "7" or less on a scale of 1 - 10) and those that quit or are terminated for performance.

CEO's will certainly attribute a company's good results to the outstanding people that they have brought into the organization. However, ask them what their "hiring failure rate" is, or ask them the "cost per day to the organization for each job that goes unfilled" and you will likely get a blank stare.

If you are employed in the staffing business (either contract or permanent placement), what are you doing to help reduce the overall inefficiencies of hiring? When was the last time you educated buyers on the impact of some of the poor practices they deem necessary? And when was the last time you played the role of consultative business partner by showing your client how to calculate the real dollars lost for every job that needs to be re-filled or re-placed? Great people drive outstanding organizations. So as the shortage of workforce talent continues to increase, attracting the best talent will become exponentially more difficult. And by implementing any of the damaging practices listed above, the best talent will opt to go elsewhere.