By Paul Pompeo
Seems like everyone’s hiring today, doesn’t it? From the plethora of ads on industry websites and in lighting publications, to your local grocery store or Starbucks, it’s hard to go a day without seeing “Help Wanted” signs. For employers, in some ways, it feels like the California Gold Rush in the 1800s.
According to a U.S. Labor Department report, there were 1.8 job openings for every unemployed worker in early 2022. Let’s think about that for a moment—almost twice as many job openings as people out of work. Compare that to two years ago, near the beginning of the pandemic, when the ratio was completely different, with more unemployed workers than job openings. When chief economists (in this case, Stephen Stanley with Amherst Pierpont) use words like “torrid”—usually reserved for romance novels or soap operas—to describe hiring, we realize we’re at an unusual place.
It’s been an amazing and historical two years. As life begins to return to a post-pandemic “normal,” it’s very important to take a moment to be grateful for how much we’ve bounced back after such a tumultuous and unprecedented period of our collective life. In a way, the pandemic has been our generation’s Great Depression—a once-in-a-lifetime phenomenon that will likely influence many of us for the rest of our lives. And how things have changed and continue to change! Two years ago, many companies were reducing headcount, but it is a very different landscape today.
Companies reaching out to executive search firms in 2022 fall into two basic categories: 1) those who have just begun their search, and 2) those who have been trying to look on their own, or have used another recruitment source, without success. For companies fitting in the latter category, we can quickly determine the reason why they have not filled their position during an initial call. While the hiring landscape today is completely different than it was a year or two ago, it’s also different than it was pre-COVID, in 2019. If you’re using the same approach that you did then, that’s a likely reason you’ve had difficulty filling your role. Bottom line? The market for employees has changed significantly since 2019. While some of these changes may not be long-lived, others may actually be permanent.
Whether you’re in the C-Suite of a lighting conglomerate, head up a design practice, are a VP of sales for an electrical wholesaler chain or a HR manager for a small lighting manufacturer, you’re seeing the turbulent atmosphere for employers trying to hire today. So, make sure your seatbelt is securely fastened, and then consider this list of five things you can do immediately in order to compete effectively in today’s ultra-competitive hiring environment:
1. Pay competitively. This may sound obvious, but you’d be surprised how many employers start off with a compensation range that is below the average, sometimes significantly so. And the longer it’s been since the position has last been open, the more likely a company’s concept of what that position should pay is out of date. If you are not sure what the compensation range for your position should be, an executive search firm should be able to give you the going rate. Salary studies non-specific to lighting are often too broad and not very helpful. Strong candidates today will rarely take a lateral move financially, even if your company has a compelling story.
2. Consider alternatives to restrictive non-competes. We’ve written extensively about the restrictiveness of many lighting and electrical companies’ non-compete agreements, and how overly restrictive non-competes are not only bad for the employee, but can also be bad for the company and detrimental to our industry.
It’s completely understandable that companies must protect themselves when a person leaves their employment, but some forward-looking companies use a form of an NDA (non-disclosure agreement)—and often a non-solicitation and/or non-poaching agreement—to prevent a former employee from going after customers they’d just been working with or trying to recruit their former coworkers for their new firm. If your company has a more restrictive non-compete (I call these the “You’ll never work in this town again” type), many savvy potential employees will refuse to sign. At the least, be prepared to negotiate the terms to make it equitable for both parties.
3. Reconsider your policy on remote work. For many employees, remote work is not going away, although many industry leaders wish it would. Many companies are currently testing “hybrid” plans (two or three full or partial days per week in the office). Will that continue, expand to full-time work in the office, or go the opposite way with employees preferring to work completely from home? It’s too early to tell at this point. One of the very first questions our team gets when speaking with a potential candidate is, “Where would I be working?” If the answer is “in the office five days a week,” you immediately lose at least 70-75% of your talent pool.
Granted, many positions must be based in an office. Having said that, even engineering, which many hiring managers have said must be an in-office position, is changing to a degree. We know of at least one respected cutting-edge lighting manufacturer who now has their engineers working remotely. As engineers with other lighting manufacturers see this company allowing their industry peers to work remotely, what will keep them from asking their employer to do the same?
4. Determine your candidate’s “pain.” If a candidate’s only reason for a change is greater compensation, then building a mutually productive and long-lived relationship is unlikely. Often times, that candidate will either simply accept a counteroffer from their current company or go to the highest bidder if they are interviewing with more than one company. You want to identify a candidate’s “pain”—their reason for making a change—and determine their motivation.
5. Tell your company’s story effectively. What makes your company special? How are you different from your competitors or other lighting manufacturers? In today’s competitive landscape, if your opening seems just like a “job” to candidates, you’re unlikely to engage them and are likely to lose them to more compelling companies or companies with more compelling stories. Not sure how to do this, or not sure what your story is? Utilizing the services of a consultant to advise you on branding and/or effectively telling your company’s story can help. You’ve heard the adage, “Insanity is doing the same thing over and over again and expecting different results.” It certainly applies to today’s hiring market. Using these tips when mining for candidates should increase your chances of finding your own piece of “gold”—and decrease your chances of coming away empty-handed.