Read If You Wish To Be Scared - The Employment Outlook For The Rest Of The Year (June 2010)

The Employment Outlook From A Recruiter

As of the past few weeks, owning a recruiting firm, I have seen a dramatic shift in the job market and it’s not pretty. I do hope that this hiring downturn is partly due to the fact that it is summer; however this does not seem to be the case. It is in my strong opinion that this unemployment wave is the real-deal.

The main reason I can judge this quite accurately is that, statistically speaking, my agency (and I’m sure my competitors as well) is still receiving the same amount of hiring inquiries from employers. Though, the quality of leads coming in the requests we’re receiving from employers shows that it is a bad job market…again. For instance, in a good market, 40%+ of incoming leads from a new client are worth a recruiter’s work effort, in a bad market it’s more like 15%. Right now, we’re pushing towards the latter.

Though, as I will do my best to explain, these leads and the quality of them, tell a lot about the job market both currently and in near the future. Again, this is from the sales and marketing job market as it is what I know, though it is probably indicative of the overall employment scene.

1. The “I’m Not Sure What I Want” Client Is Making a Comeback – many clients who come to recruiters these days are not 100% serious about hiring a sales or marketing professional. There are a few tell-tale signs of this. First, an employer will not know what background they want in the person. Yes, everybody wants someone who is intelligent, well-spoken, etc., etc. Conversely, when a potential client gives these very broad mandates to a recruiter, it means that they, more than likely, want to see what is “out there.” Since a lot of recruiting firms work on contingency fees which means that they are only paid when somebody is hired, it is of no cost to the employer.

2. The “I Want An Employee, But I Don’t Want To Pay” Client – these too, are slowly poking their heads out of the ground. People have this very peculiar thought process which consists of the presumption that people would want to work for them for free (no base salary – commission only). There is an inverse relationship between a good job market and the number of “free employee” calls a recruiting agency receives. After all, if there weren’t so many people out of work and hiring was still going strong, nobody would get the melancholic idea that people want to offer free labor.

3. The “And The Base Salary Is…” Client – these are the firms who want to pay their employees under $50,000 per year. This is a bad sign as it tells a recruiting agency that salaries are going lower and firms are set on what they want to pay. The amount of jobs which are paying less than $100,000 on the base salary, has drastically declined. To any recruiter, this is scary.

4. The “We Want To See More Applicants Crowd” – again, since most recruiters work on contingency fees, companies can feel free to see as many applicants as they wish (or until that recruiter gets fed-up). As of the past two months, companies have been consistently asking to see more and more applicants prior to filling a job. Again, this is quite negative.