As we inch closer to what is shaping up to be an impactful economic downturn, many questions and concerns have arisen. Layoffs have been on the minds of many, along with what hiring will look like in the possible recession. From shifting the focus inward to weighing the pros and cons, here are insights from recruiters, business executives and HR leaders into the hiring market during a recession as well as their personal plans for 2023.
Incentivizing Existing Employees Instead of Recruiting
Hiring during a recession is certainly more difficult, as employers search for capable and available candidates who often overlook such opportunities while they wait for the economy to pick up again.
An uncommon approach to recruiting in 2023 could be to focus less on job seekers and more on talent retention—by providing better incentives than the competition for current employees, organizations could ensure a steady pool of talent ready for new responsibilities, regardless of the economic climate.
CEO, Museum Hack
Focusing on Entry-level
Typically, it is a lot easier to hire people during a recession. Since a lot of businesses want to minimize their costs by cutting down their workforce, it means that there are a lot more candidates than there are open positions. Hence, even if you simply stick with your current recruiting approach, you should be able to pool a significantly greater number of applicants compared to normal.
However, while recruiting talent is easier during a recession, retaining talent is much harder. During this time, there is a lot of movement since people are constantly seeking companies that offer better pay or a better work environment.
To address this, our recruiting strategy for 2023 would be to hire more fresh graduates or candidates with minimal experience. Since not a lot of companies are willing to hire these types of candidates during a recession, we’ll face no shortage of applicants, and we can make sure that they will stick with our company in the long term.
Chief Operating Officer, Financer.com
Proving Your Company Is Recession-proof
People often transition from one industry to another during economic downturns. They see that certain industries suffer the most during recessions, and on top of that, never bounce back. Lots of people have left print journalism because of declining revenues and resources. Lots of people left the real estate and retail industries during the Great Recession. Many others left the food-and-beverage industry during the throes of the COVID-19 pandemic.
As one industry diminishes in terms of manpower, others show signs of growth. Consumer habits also change a lot during a recession—and many of those changes become permanent, often bolstering entire industries. If you’re in a space that shows signs of being recession-proof, the public is going to notice. Job seekers, in particular, are going to notice—and they’re going to want to apply for jobs at your company. You can use that to your advantage.
Co-Founder, Pocketbook Agency
Viewing Recessions as Opportunities
While some companies are starting layoffs and hiring freezes, others see it as an opportunity to bring in skilled staff members. On the verge of an impending recession, a large number of Silicon Valley businesses are suspending hiring and implementing mass layoffs.
For instance, in a note, Andy Jassy, CEO of Amazon, stated that the layoffs would continue throughout 2023. Tech behemoths like Apple, meanwhile, see the economic downturn as an opportunity. For instance, Apple hired top engineering talent during the economic downturn following 9/11, which allowed the company to introduce the iPhone and iPod in the following years. Business executives must therefore see the recession as an opportunity for long-term growth and act accordingly.
Founder, United Medical Education
Increasing Digital Marketing and Virtual Tool Usage
It is not necessarily easier to hire during a recession, as there is likely to be more competition for fewer jobs. During a recession, it is important to focus on recruiting the right talent who are driven and have the skills to help your business succeed.
My recruiting strategy in 2023 is to focus more on digital marketing to reach out to a broader candidate pool, and use targeted outreach to find the best talent. Additionally, I will be utilizing virtual recruitment tools to streamline the interview process and enable more efficient decision-making. I will also be leveraging data-driven insights to ensure that my recruiting strategy is aligned with my business goals.
HR & DEI Consultant, Sporting Smiles
Optimizing the Candidate Experience
The candidate experience will continue to be a deciding factor in competitive hiring. Over the past year, we saw that candidate experience was a critical, deciding factor in the overall success of the recruitment process.
From recruiting to screening to interviewing, providing constant communication, and building a positive candidate experience can make a significant difference in the candidate’s perception of a company and their decision to accept a position.
As the labor market continues to be in turmoil in the coming year, hiring teams will need to build brand-rich candidate experiences that include opportunities to demonstrate their skills through ethical, science-based job previews and/or simulation assessments and offer personalized feedback—as close to real-time as possible—while also providing an opportunity for the candidates to experience what the job is really like.
EVP of Innovation, Modern Hire
Leaning into Remote Hires With Diversity and Inclusion
It can be easier to hire during a recession, as there may be a larger pool of unemployed or underemployed individuals looking for work. When there’s a recession, people are more likely to take whatever job they can get—even if it’s not perfect for them or their needs—because they need the money.
This means that companies can find great talent at a lower price point than usual. However, it also depends on the specific industry and job market conditions. Recruiting strategies are constantly evolving and can change depending on economic conditions. We are focusing more on virtual recruiting and remote hiring due to the shift towards remote work. Additionally, we aim to build a diverse and inclusive workforce as part of our recruitment strategy.
VP, Strategy & Growth, Resume Worded
Involving the Extended Team in the Process
During a recession, the job candidate pool gets bigger, which is both good and more challenging. An attractive job opening will generate more interest, more candidates and a bigger pile of resumes and cover letters to wade through. You will probably need more people to sift through all of the applicants.
Finding the standouts becomes more labor-intensive, so you will need to devote more resources and personnel to assist you in compiling the best group of candidates. Sometimes, you may need to ask non-managers to help you with that. Call on your top producers to help you, as they know better than anyone else what skills are required to excel at your company. Seek feedback and assistance from them. Hiring during a recession typically calls for more manpower.
Juan Pablo Cappello
Co-Founder & CEO, Nue Life
Finding the Pros and Cons
Yes, it’s a great time for individuals who have taken the plunge to explore something new, such as freelancing or side hustles. This is how startups are born.
Right now, we are seeing Microsoft investing $10 billion in OpenAI but laying off 10,000 staff at the same time. Freelancing opportunities work well during recession times for those who take the brave decision because it pays well and, for the employer, it’s a low-risk strategy.
On the employment side, hiring during a recession can be tricky, and it really depends on the situation. Companies may have limited resources and budgets, so they may have to be more selective in whom they hire. On the other hand, there could be a large pool of qualified applicants, which gives employers plenty of options to choose from. Ultimately, it’s important for companies to carefully assess their needs and figure out what hiring approach works best for them.
Weekly news and industry insights delivered straight to your inbox.