3 ways talent teams can use an economic downturn to their advantage
There is no better catalyst for positive change than an economic downturn.
A slowing economy has a pervasive effect on all types of organizations. It forces them to pause and take stock: what’s working, what isn’t working, and what needs to change.
In most instances, this can lead to bunkering down - going lean, paring back, and riding out the storm. In other, rarer instances, it can be a catalyst for powerful change that becomes the driving force behind an organization’s growth for years to come.
Netflix has famously driven product innovations during times of economic challenges. Their streaming service began during the Great Recession - and was even launched resourcefully. Instead of investing in new channels to try to tap into their target users’ homes, they formed partnerships with the products that their target users were already using, such as Xbox. Meanwhile, companies like Mailchimp pivoted entire business models and took the previously unfathomable bold step of adopting a “freemium” option that ended up growing their user base five fold.
Growth, progress, and success are all still possible during economic downturns. It just requires reframing the experience as an opportunity to drive change.
So, what does this all have to do with the world of early talent recruiting? A lot, actually.
For too long, talent teams have been experiencing a recurring theme of challenges, such as:
- Maintaining an adequate and sustainable pipeline of great candidates;
- Justifying the costs and resourcing that go towards the various efforts to attract, engage, nurture, and hire talent;
- Overcoming lower than expected retention rates; and
- Navigating the growing sensitivity and scrutiny over hiring practices that are not considered to adequately empower DEI&B initiatives.
Some of these challenges are inescapable. Talent teams cannot control the shifting values of a new generation of talent that has a more transient view of their future employers than previous generations. Others, however, are ripe for an overhaul - and making the changes are easier than you think.
What can talent teams realistically do?
1. Use virtual platforms to reduce your in-person expenditure - while expanding your reach and engagement with early talent.
In-person events and activities can be incredibly expensive. In 2019, NACE found that talent teams were attending on average nearly 50 on-campus events every year. When considering the combined costs of flights, accommodation, time, and materials - it gets a bit eye watering.
Yet, multiple studies continuously show this generation of talent prefers to access information and form connections online, rather than in-person. This means that while we (as, perhaps, the slightly older generation) crave the in-person experience and feel exhausted by all things virtual, early talent does not. Talent teams can use this to their advantage in lean budget environments by shifting in-person investments to virtual ones that provide a scalable and interactive channel to early talent. There are many platforms that provide this (including Forage). And not only do they provide 24/7/365 digital brand presence, they also enable employers to tap into a broader range of talent that might not have otherwise been able to afford to attend or travel to in-person events.
Employers like Walmart, SAP, and Cognizant do this through virtual job simulations. Through interactive and simulated experiences that demystify the work they do, they form an always-on connection with early talent. And, conveniently, the simulations are integrated into coursework across hundreds of colleges around the world - creating on average nearly 5 hours of employer brand immersion per simulation (which is a lot more than a booth at a career fair!)
2. Improve retention rates through positive friction, not swag.
There’s nothing worse than thinking you’ve met your hiring numbers, only to have a handful of new starters opt-out at the last minute. This is particularly the case when they’ve turned down the offer to go to a competitor. And unfortunately the answer to this issue isn’t swag (as much as we’d like it to be). The answer is focusing on the candidates that truly want to work for you. They’re out there - they just need the opportunity to stand out amongst the ocean of candidates (and employers need the tools to find them).
This is where positive friction helps. Talent teams shouldn’t be afraid to incorporate hurdles into their application process that provide an opportunity to identify candidates truly interested in and committed to their workplace. We all need something to quieten the noise created by one-click applications.
At Forage, our partners like JPMorgan, Deloitte, and BCG use positive friction. They use the completion of their virtual job simulations as a signal of someone who is genuinely interested in their workplace. Because if someone decides to spend 4-8 hours completing a simulation in their very limited free time - and still applies, they are a high-intent candidate.
We call it ‘positive friction’ because:
- The candidate chooses to take part in the simulation. It’s not compulsory nor treated as a form of assessment
- If they complete the simulation and choose not to pursue the role, they walk away with real-world tangible skills that they can apply elsewhere. And when considering that early talent today is as, if not more, anxious than employers about the skills gap (and how this impacts their employment prospects), this creates everlasting goodwill towards the company that provided the simulation. And this word-of-mouth spreads to other candidates.
This is why Forage candidates are:
- 4x more likely to receive an offer
- 4x more likely to accept an offer.
By prioritizing high-intent candidates, employers benefit from higher retention rates.
3. Preskill to easily and scalably build a pipeline of high quality candidates.
The growing skills gap doesn’t go away with an economic downturn. In fact, tackling the skills gap in the next few years remains a critical priority across not just employers around the world, but also global institutions like the World Economic Forum. And the stats continue to speak for themselves:
- By 2025, 375 million will need to be upskilled and we will see $8.5 trillion in unrealized revenue because of the skills shortage
- In-demand skills will no longer be widely available by 2030 - even though by 2025, $500 billion will be spent on upskilling.
All to say, there is a powerful financial incentive behind continuing to prioritize solving the skills gap - even during economic downturns - and talent teams are uniquely placed to make a major impact. How? Through preskilling.
Talent teams across the globe from employers like HSBC, AON, Lululemon, Electronic Arts, GE, and the big four consulting firms are using preskilling to bridge the gap between the world of study and work, and benefit from candidates that are better equipped to hit the ground running from day one.
You can learn more about preskilling here. TL;DR:
- Preskilling sits at the intersection between the workplace, career exploration, and gaining skills
- Forage preskills using simulations of actual roles within an organization to train early talent before they even enter the talent pipeline
- The simulations are free and open-access - meaning employers benefit from a diverse range of candidates
- Skilling opportunities are now open to the masses, meaning employers benefit from candidates that are 99% more skilled in the role.
Economic downturns create opportunities to innovate. Talent teams should feel empowered to use this time to make real changes that will set their team, and broader organization, up for success.
If you want to learn how major global employers are doing this right now, you can schedule a consultation here.