The hiring process is broken, failing to successfully respond to labor shortage

Hiring talent today is the number one concern of CEOs and the entire C-Suite, according to a recent Conference Board Annual Survey. Businesses are struggling to successfully hire needed employees against a back drop of significant labor shortages in the United States.  

Unfortunately, the hiring process is broken at a very critical time when the approach and process need to be strategic, efficient and agile. There is major criticism of the hiring approach and process and its failure to provide successful results. 

The “Old School” Approach 

A detailed job description was prepared after determining what tasks the job required and what attributes a good candidate should have. Next it was determined how the job fit into the organizational chart and the pay grade. Ads were posted, applicants applied and were vetted by skills tests, reference checks, other tests, and extensive interviews to learn more about them as people. Then a person was selected and offered the job and hired. 

Today’s Approach 

Today’s approach is vastly different. The majority of people who took a new job last year were recruited and they were not looking for a new job. The recruiting and hiring function have been gutted. About 40% of U.S. companies, according to research by Korn Ferry, have outsourced much if not all of the hiring process to “recruitment process outsourcers,” which in turn often use subcontractors, typically in India and the Philippines. 

What’s Wrong? 

Employers are complaining loudly about their difficulty hiring talent. There may be many explanations, including being very picky about candidates. Ironically, they are hiring much more than at any other time in modern history, for two reasons. 

The first reason is openings are now filled more often by hiring from the outside than by promoting from within. In the era of lifetime employment, from the end of World War II through the 1970s, corporations filled roughly 90% of their vacancies through promotions and lateral assignments. Today the figure is a third or less.  

Less promotion internally means that hiring efforts are no longer concentrated on entry-level jobs and recent graduates. Today, companies must be good at hiring across most levels, because the candidates they want are already doing the job somewhere else. These people do not need training, so they may be ready to contribute right away, but they are much harder to find. 

The second reason is that retention has become very challenging. Companies hire from their competitors and vice versa, so they have to keep replacing people who leave. Census and Bureau of Labor Statistics data shows that 95% of hiring is done to fill existing positions. Most of those vacancies result from voluntary turnover.  

Here are some of the current failures in the hiring process. 

1, Posting jobs with misleading and unrealistic requirements 

Determining the requirements of a job and the corresponding must have attributes of candidates are a bigger challenge today because there are fewer internal recruiters whose function includes pushing back on hiring managers’ wish lists. Reducing the number of recruiters with expertise in hiring and handing the process over to hiring managers is a prime example of a failure in the hiring process. 

2. Posting phantom jobs 

It costs nothing to post job openings on a company website. The postings are pushed out by Indeed and others to potential job seekers around the world. And unfortunately, some of these jobs simply do not really exist. Employers sometimes may be fishing for candidates. Sadly, ads are sometimes posted by unscrupulous recruiters looking for résumés to pitch to clients elsewhere. Phantom job postings are questionable and unethical to many and are very frustrating to job seekers.  

3. Obsession with new technology to reduce costs from employee turnover 

 A different approach for dealing with retention is to attempt to determine who is interested in leaving and then intervene. Vendors like Jobvite crawl over social media and public sites for clues, such as LinkedIn profile updates. Measuring “flight risk” is one of the most common goals of companies that do their own sophisticated HR analytics.  

4. Refusing to revise the interviewing process 

Interviews are the most difficult technique to get right, because interviewers should stick to questions that predict good hires (mainly about past behavior or performance that is relevant to the tasks of the job) and ask them consistently across all candidates. Being unprepared and asking whatever comes to mind will enable biases to easily show up as the interviewer tries to interpret the answers. Employer interview time has almost doubled since 2009, according to Glassdoor research.   

5. Age Discrimination in the hiring process 

Every hiring professional knows it is illegal to discriminate against a candidate based on age. Yet, a recent survey revealed that many hiring professionals find they inadvertently engage in age discrimination during the hiring process.  

Some of the ways this appears is asking for candidate photos, graduation years and the entire list of positions held in an applicant’s career. Asking about hobbies or other leisure time activities also may present a connection to certain age groups. 

6. Failing to track & measure outcomes 

Few employers know which channel produces the best candidates at the lowest cost because they do not track the outcomes. For example, college recruiters calculate which schools send it employees who perform the best, stay the longest, and are paid the lowest starting wage. Other employers should follow suit and monitor recruiting channels and employees’ performance to identify which sources produce the best results. 

“Hiring people is an art, not a science, and resumes can’t tell you whether someone will fit into a company’s culture.” – Howard Schultz, American businessman and author. 

Glenn Ebersole is a registered professional engineer and the Director of Business Development at JL Architects, a nationally licensed commercial architecture firm based in West Chester. He can be contacted by [email protected] or 717-575-8572.