Hiring isn’t a straightforward process. It demands a coherent strategy based on the company’s vision, mission, and of course, the market dynamics. For a recruiting team, the hiring strategy varies based on whether they are operating in a client-driven market or a candidate-driven one.
In a client-driven market, companies call the shots. They hire at their own pace, can focus wholly on their needs, and face little or no competition from peers in the industry. On the other hand, a candidate-driven market is driven by stiff competition in the job market. Hiring becomes a challenge for companies owing to the high demand for specific skills.
Talent and benefits go hand in hand. The rapidly-changing industry weighs heavily in favour of skilled candidates. Clients are prompted to raise compensation and entice good candidates with better benefits. So strong is the candidate-driven market that it can become a key strategic risk. Silicon Valley offers the clearest example: Companies in the Valley battle to offer the best compensation and benefits to attract and retain top technology talent.
Time and money are of the essence in today’s hiring scenario. With increasing demand and an expanding talent pool, companies are forced to close interviews quickly. Candidates these days have multiple opportunities, which brings a sense of urgency to the hiring process. It costs thousands of dollars for a company to fill an open position.The more they delay a hiring decision, the costlier it gets. According to Talent Acquisition Factbook 2015, U.S. companies spend $4,000 on average to fill an open position, and that doesn’t include training or ramp up. This situation isn’t a pleasant one for companies, as they are also forced to invest heavily on candidate retention strategies after their well-directed efforts in attracting talent.
Client- or candidate-driven economy—the economy determines it. Hiring in a client-driven market is an indicator of surplus in the talent market. This could be a sign that the economy is stagnating, thereby muting hiring intensity. It could also be a direct consequence of a turbulent economy, where job losses and unemployment make it easy for companies to hire the best talent. A candidate-driven market, however, presents a different picture. It points to the fact that there are fewer available candidates coupled with more job opportunities—usually a sign of a booming economy. According to the MRINetwork Recruiter & Employer Sentiment Study, 86% of respondents called the labour market candidate-driven in 2016, compared to just 56% who said the same in 2012.
Whatever the market scenario, executive recruiters have their tasks cut out. Hiring senior executives can be a long process. Executive recruiters have to balance both the client and the candidate’s timeline expectations. But it can’t get too casual, as there is inherent risk of losing the candidate to a competitor. Recruiters must be highly efficient and be in touch with the candidate at all times. This is in stark contrast with a client-driven scenario where they are not in a pressure-cooker situation to help close a position.
The candidate-driven market has become a challenge for companies looking to hire top talent in recent years. Executive candidates are usually passive job seekers who are well settled in their roles. Hence, recruiters must adopt better employer branding strategies and streamlined hiring processes to overcome the marketplace challenges.
Author: Liam Copsey