Employers - Plagued by Talent Shortages - Must Shift Focus to Front of Hiring Funnel

February 8, 2019

 

iCIMS Staff

4 min read

Imagine employers’ frustration. Employers invest an estimated $200 billion on recruitment worldwide, according to Josh Bersin, the founder, president and chief editor of Bersin by Deloitte, an analyst firm that covers the recruiting industry. Of that amount, employers will increase their spending on recruitment solutions and services by 16 percent to $8.5 billion by 2022, according to International Data Corporation, another analyst firm that covers the space.

Yet, they find themselves scrounging for a dwindling supply of job seekers to fill a rising number of job openings as they try to stave off crippling talent shortages, which diminish productivity, force wages higher and jeopardize delicate bottom lines.

How can employers survive, let alone thrive, despite the talent odds so heavily stacked against them? They need to get recruitment technology that lures job seekers to the front of the hiring funnel before they worry about software for funneling candidates through it, which will give them the advantage over their competitors amid the tightest labor market in decades.

Talent Shortage Projected to Worsen

No matter how much employers spend on recruitment, they cannot buy a more favorable economy. A look at data from the U.S. Bureau of Labor Statistics reveals the increasingly dire economic situation that they face as the Great Recession further fades into the rearview mirror:

• The unemployment rate fell to 3.9 percent by the end of 2018, down from 4.1 percent in December 2017 and the 20-year high of 10 percent in 2009.
• At the same time, the number of unemployed persons per job opening fell to .9 through November 2018 from 1.1 in November 2017 and a far cry from the peak of 6.6 in 2009.
• The number of job openings, however, grew by 16 percent through November 2018, up from 5 percent through November 2017 and a long way from shedding jobs during the recession.
• Meanwhile, wages grew by 3.2 percent in 2018 after hovering around 2.5 percent from 2015 to 2017 and 2 percent from 2009 to 2014.

The numbers neither lie, nor discriminate, as talent shortages plague employers of every industry and size around the globe, and projections indicate that they will only get worse with time. Employers will face a total shortage of 85.2 million workers and a loss of $8.5 trillion by 2030 worldwide, according to Korn Ferry, an organizational consulting firm. That includes:

• Finance, which will face a shortage of 10.7 million workers, amounting to a loss of $1.3 trillion.
• Manufacturing, which will fall short by 8 million workers, costing $607 billion.
• Technology, media and telecommunications, which will lack 4.3 million workers, resulting in a loss of $450 billion.

Employers Need to Turn Attention to Front of Hiring Funnel

Employers previously needed recruitment software to funnel an abundance of candidates through the hiring process, but the new economic reality requires that they use technology to lure now-picky job seekers to the front of it.

They should begin by optimizing their job descriptions for Google now that the search engine indexes job openings shared on the internet. Those that do so will help their job openings rank higher in Google’s search results and drive more traffic to their career sites, a critical concern as 69 percent of job seekers use the search engine to look for open jobs and research employers, according to iCIMS.

More importantly, employers will no longer need to advertise their jobs on costly job boards, as many job seekers will not need to look further than Google. For example, traffic to iCIMS’ career site skyrocketed by 90 percent after the company optimized its job descriptions for Google while that from Indeed kept declining year after year, its Chief Marketing Officer Susan Vitale told CNBC.

However, employers run the risk of losing job seekers’ interest if their career sites offer a poor search experience in stark contrast to the easy Google search that brought them there. They should look forward to iCIMS’ recruitment-marketing solution launching this year, which will include:

• Job-discovery features that will improve the search experience on career sites by using Google’s cloud-based machine-learning capabilities to enable acronym and seniority recognition, geographic-proximity consideration and spelling forgiveness.
• Tools that will allow for branding, the ability to feature high-priority job postings and direct control over other types of content on career sites, eliminating the need for costly-and-unreliable handling by third parties.
• Mobile-application functions that will make it easier to attach resumes and other supporting documents — such as certifications, portfolios and videos — to decrease the number of candidates who abandon applications due to difficulty applying on mobile devices.
• Performance analytics that will measure candidate-to-applicant conversion rates, the effectiveness of recruitment marketing campaigns based on the number of talent pool members and applicants that they generate, and more.

Employers need to realize that today’s selective job seekers may not want to immediately apply regardless of great career sites, though. Again, they risk the possibility of letting job seekers slip through their fingers unless they use a candidate-relationship management solution, which allows employers to build talent pools of job seekers and regularly communicate with them to nurture them into candidates. More importantly, job seekers value the ability to stay in touch with employers, too, as 55 percent of them joined talent pools run by employers that interested them, according to iCIMS.

Only after following those steps that address the front of the hiring funnel can employers finally turn their attention toward technology that smoothly funnels candidates through it.