Building resilience in recruiting

This article was co-developed with Rod Adams, PwC's Talent Acquisition and Onboarding leader.

2023 continues to be an exciting year for HR functions, who are grappling with downstream impacts of the Great Resignation and increasingly, downsizing, amidst market volatility, continued jobs data, and most recently, turbulence and uncertainty in the banking sector. The impacts of these events will be far-ranging, but the agility and resiliency of organizations will continue to be tested for the foreseeable future.

No HR function has gone through more turbulence in the last two years than recruiting/talent acquisition (TA), catalyzed by the pandemic, the Great Resignation and a strong economy. Finding talent remains a challenge in some industries, while others are experiencing a cooling labor market. According to PwC’s 26th Annual Global CEO Survey of 4,410 chief executives, although 52% of CEOs say they have already begun cutting costs, only 19% are implementing hiring freezes. When asked if they are considering this intervention over the next 12 months, the number rises to 24%. On the flip side, over half of CEOs (52%) cite labor/skills shortages as a key force that will impact the profitability of their industry in the next 10 years, and the majority of CEOs (73%) think current employee attrition rates will either stay the same or increase in the next 12 months.  

So what does this mean for recruiters/talent acquisition at large, many of whom were just starting to take a collective *deep breath* following the busiest recruiting year many have ever encountered? From our own experience at PwC and with clients, we are seeing that recruiting executives remain optimistic as they now have a unique opportunity to reimagine the role of the recruiting function. Most have accepted that job market volatility will be a near-constant for the foreseeable future. Now, is the time to shift to more strategic, flexible recruiting operations, and make recruiting a resilient, adaptable capability. 

To be effective, there are five areas we are seeing recruiting leaders prioritize: 

1. Optimize recruiting technology and adoption — Funds for new investments are limited right now. Rather than make new investments, leaders are focusing on optimizing prior ones. Many are evaluating if additional capabilities within their existing tech stack can be turned on and leveraged, and others are looking at enhancing integrations within their HR tech ecosystem to gain efficiencies. Technology is going to be key in managing higher volumes and navigating the next ‘Great Resignation’. 
2. Explore new talent pools — The data tells us that labor and skills scarcity will remain a top challenge. Leaders are getting creative to fill these gaps by shifting to skills-based recruiting models, expanding their talent pipeline to include those who developed skills outside of traditional routes (e.g., dropping traditional degree requirements), as well as implementing talent marketplaces to tap into the gig workforce. 
3. Building a skills ecosystem is a business imperative — Leveraging existing talent creates a win/win for organizations and employees alike -- internal mobility both accelerates career development and improves retention, while reducing costs related to turnover, hiring and onboarding. But mobility of the future looks different than mobility of the past -- it requires building a skills ecosystem that is underpinned by clear skill definitions, enriched with validated employee data and enabled by digital tooling. We see an opportunity for recruiting to forge strong partnerships with L&D and IT in this space, as well as work at an industry and regional level to create consistent skills taxonomies and portable skill passports.   
4. Anticipate a changing regulatory landscape — A number of new recruiting-related regulations in 2022 left many organizations scrambling to react (e.g., salary range disclosures on job postings, proper controls to mitigate potential bias in AI/ML recruiting). Regulations require a variety of actions for organizations to be compliant, and if not implemented properly, could actually harm versus improve the candidate experience. It is important for recruiting leaders to engage in ongoing dialogue with regulators in an effort to help shape the future regulatory landscape as well as keep their organizations agile, resilient and ready to adapt to further changes. 
5. To drive measurable progress in DEI, efforts need to go beyond hiring to retention — Talent leaders are holding their organizations accountable for creating diverse talent pools. Many have self-imposed stringent slate requirements (e.g., # of female candidates, # of underrepresented groups), particularly around leadership positions. Additionally, partnering with new sources for talent to attract diverse professionals as they enter the labor market (e.g., AfroTech, Grace Hopper, certificate/bootcamp programs, community colleges). But, retaining this talent remains a challenge. We see middle managers as a key opportunity to drive inclusive leadership behaviors and foster belonging, trust and deeper connections in a world of hybrid work.

It’s clear that recruiting functions of all sizes and industries are still adjusting to new ways of working, economic uncertainty, and unforeseen global business challenges. As recruiting volumes decline, we see a tremendous opportunity for recruiters to capitalize on the creative, innovative approaches which emerged over the pandemic – A resilient and agile recruiting function that can quickly adapt will be well-positioned to help drive sustained business outcomes for the long haul.

Thank you to Stefanie Goldberg, Jessica Virtuoso, MBA, SHRM-CP, Jill Kiemele, and Astik Ranade for your contributions to this discussion and holding myself and Rod to putting pen to paper!