The Irrationality of Rational Recruiting
As the pandemic took hold, many people thought that higher unemployment rates would lead to a deluge of candidates vying for only a few openings. Others recalled the Great Recession when there were hundreds of applicants for every job posted, expecting that 2020 would look and feel almost the same. But it so far it hasn’t. Quite the opposite, in fact.
Many companies are reporting that application numbers are actually down year over year. Or consider the nearly 17,000 Southwest Airlines employees who seemed to surprise leadership when they signed up for leaves of absence or early retirement, rather than wait things out. What gives?
Many of our theories about the talent market are based on our understanding of supply and demand. Using it, we typically do a pretty good job of anticipating what will happen in the job market because the forces at play are usually constant. After all, everyone wants a job. Until they don’t.
This is an easy trap for people to fall into. Trying to create a narrative based on top-down analysis using general principles and the same sets of assumptions we normally use. But when we don’t recognize that these assumptions have changed, we end up surprised by the results and lead to believe the market is behaving irrationally.
In ‘uncharted waters,’ it is important to revisit our beliefs and see if they still hold. A good way to do this is to take a bottom-up approach to interpret the job market. Start by looking at what individual people are doing and why they’re doing it. When you extrapolate those specific cases into a trend, we’re more likely to arrive at a valid insight.
But that’s just the beginning. Figuring out the way forward is the tricky part. Especially when it comes to recruiting. But maybe, just maybe, this is the time to go against conventional wisdom and track down the point of destabilization and fix it.
The Heart of the Problem
Back in March of 2020, clinical psychologist Steven Taylor wrote, “The more I read about pandemics, the more I realized that pandemics were essentially psychological phenomena. The more I researched the psychology of pandemics, the more I realized that psychology is important in how society reacts to pandemics. It became apparent that psychology was extremely important in understanding how people cope or react to the threat of pandemic infection.”
The problem is, few, if any of us, alive today have direct experience living through a pandemic. As a result, we have no idea how to act or what to do under these circumstances. When the human brain doesn’t know how to process what’s happening, people act irrationally. But even within illogical behavior, there’s logic. It’s up to us to identify the underlying actions and organize around what’s happening now. Why is it that during a pandemic, some of the people who wanted jobs before no longer do?
Where Irrational Meets Rational
With uncertainty in mind, we have the opportunity to re-imagine recruiting for pandemic times and beyond.
Starting with how we interpret metrics. For years, we have looked to employment metrics as a bellwether, but there’s usually more hidden below the surface. There are factors at play that aren’t as obvious as, say, a global pandemic.
Take the “quits rate,” which, according to Reuters, is “viewed by policymakers and economists as a measure of job market confidence.” That figure actually increased to 2.1% in July, up from 1.9% in June. Lydia Boussour, a senior U.S. economist at Oxford Economics, posits, “More quits during the pandemic are probably a reflection of virus fear and challenges related to childcare given the current weak state of the labor market.”
Note Boussour’s use of the word “probably,” telling us that even her assessment backed by a professional understanding of the numbers isn’t a sure bet.
Getting to the Root
Nothing is guaranteed anymore. And so, while some of the issues are out in the open, we need to acknowledge that applying our old assumptions while trying to rationalize peoples’ behavior won’t necessarily yield the expected results. It’s time to rethink our toolset and how we use it.
This is when metrics become indicators rather than anchors. Particularly that cost per applicant holy grail. Yes, it’s important to know what’s happening and how much we’re spending. But numbers can’t be the end-all, be-all of our recruiting strategy. We need to make space for insecurity. Space for what’s in between the data.
Of course, this is not to say that we throw out the idea of data-driven recruiting altogether. Instead, we amend our understanding of what this information provides. Data provides critical insights into the health and viability of our efforts. But when there is no rhyme or reason for what’s happening in the world, that can only take us so far.
We need to look at the cost per applicant in today’s context and factor in new variables. If the number of applicants doesn’t correspond with unemployment rates, there’s something else going on. Something else we need to incorporate into our outreach.
At this moment, we need to approach recruiting with flexibility and agility. Evolve with the markets rather than fight to make the pieces fit.