I had a rather interesting conversation with Industry Icon, Doug Beabout, the other day. He let me know that approximately 1/2 of our industry has vaporized over the last 12 months, with many more recruiters to leave by the end of the year. As he comically put it, “A large majority of our industry will now go back to whatever in the world they were doing before the recession started.” However, he was also sure to let me know that while the current recession has been particularly painful, the massive influx of recruiters (during a boom) and coinciding mass exodus (during a bust) is actually a quite predictable phenomenon.
So I reflected on this for a while and have concluded that the ‘normalization’ or ‘purging of the excess’ is good for the Recruitosphere. Don’t get me wrong – I hate to see anyone lose their job or have a contract come to an end. However, if you’ve recruited beyond a few years, you probably know what I mean when I say there were truly some characters that parachuted onto to our scene before flopping out shortly thereafter. “Jokers to the left of me, Clowns to the right . . . Here I am, Stuck in the middle with you.” [Compliments to the band, Stealers Wheel strumming in the background way back in 1972.]
See, during boom-times, companies hire and hire and hire. They get fat, just like the average American’s credit card bill before the bottom fell out of the market and we realized that operating in the red doesn’t make good financial sense. And as the company gets fatter, so does the Recruiting Department. “Thought Leaders” start suggesting that you don’t need to lean out — nope, you need more division of responsibilities. You don’t need better recruiters — nope, you need people good at doing individual functions, just like Henry Ford popularized with the Assembly line in 1908. “Hey, you don’t need better full-cycle recruiters — nope, you need dedicated sourcers and researchers and candidate contractors and candidate developers and professional appointment setters.” That’s right, somewhere we were told we needed people good at doing only one thing all day long – “If they hate speaking to candidates, no problem – just place them at station 7.” Then, when we last expect it, we’re offered all types of services, tools, technologies, training and additional contractors to increase the efficiency of each resource and/or station of the assembly line. “Yeah, we understand your total staffing expense just ballooned up 300% Mr. Talent Acquisition Leader, but if you want to get the most out of your newfound investments, you’re going to have to spend another 50% on this Recruit-O-Meter Flux Capacitor.”
Well, sorry. That ship has sailed. We never needed the assembly line, and we didn’t need the coinciding bloat, either. It’s as if we just ate that triple cheeseburger super-sized with a large fries and 100 oz. Coke, at which point we sloth down into the couch because we’re too stuffed to move . . . wondering why we just did that to ourselves.
So this is what I’m getting at: We needed then what we still need today – Peter Drucker’s notion of “knowledge workers” who specialize in tacit interactions; intelligent people who can handle multiple moving balls in the air, yet have an instinctive ability to understand human psychology . . . and sell all at the same time. Isn’t it funny that every once in a while, the very industry that focuses on people (who have the ‘talent’) needs the old, “It’s the people, Stupid!” wake-up call?
So that’s why our current Recruitosphere detox has been a good thing. It might be like eating a lemon, or going on a grapefruit diet . . . but the weight-loss is necessary and needed for us to maintain our health, not to mention our sanity.
The HR take on what you just said.
1st rule of HR. Find out the sales in the company and plot them on a graph. Find out why they go up and down (volatility).
Now match HR supply to that volatility in sales.
Sales jobs are matched to volatile sales by low basic pay and commission or no basic pay and commission. The expectation in slow times is that we are not going to pay you! So in slow times you leave – and not necessarily 2nd rate guys. In fact the energetic and able have proably fled ahead of the down swing.
Real estate, cars, – anything directly related to the swings and roundabouts – good money in good times, no money in bad times. Average= normal salary.
A few people stay in because there is enough work for a few. It’s just business and the choices we make about where to fit ourselves into the ecology.
Josh,
great article. A great analogy of what you speak of are actually Countrywide, and several of the other mortgage companies. They had a tendency of overhiring/overstaffing – which meant lower pay, lower employee morale, with higher quotas, which ultimately meant that there was an anything goes attitude to make that increased overhead.
Though purging of any industry is a wonderful thing, as the Cream Rises to the top, and the curd goes to the bottom.. but I unfortunately don’t think that this industry will purge as strongly as it did as in other recessions – unfortunately the industries that many fell back on – auto and real estate are also hurting.
Also, the internet has changed this industry tremendously. For every person who leaves it, there are at least 2-3 who are entering, believing that because they have a phone and computer they can “do” this job..
It will be interesting to see what will happen in the next couple of mths.
KM
Josh,
I’m living the other end of this right now with my sales staff. We are doing very well and growing within our firm, and with all the staffing firms closing up shop – what a perfect opportunity to expand and build market share. Getting them to see this as an advantage has been difficult to do. When is the best time to sell someone something – strategically – when everyone else isn’t trying to sell them the same thing! Build the relationship now, and when there fortunes change (which will happen) and they have to hire again (now with less available worker pool do to aging demographics) you set your firm up nicely to be in position of picking up a ton of good work.
Hey Josh, Michael keeps a good list of people who write recruiting related blogs. which people have left?
JD, great question – you know, in terms of recruiting-related bloggers, I’d be surprised if any have left. I would imagine that most bloggers are pretty passionate about our space, so I’d be surprised if any are no longer here.
However, as you know, the remaining 99% of our space doesn’t blog (assuming that 1/100 actually do, in fact, blog . . . which might be a stretch as I’d guess it’s more 1/1000). Anyway, assuming 1/100 blog, which works out to 10 recruiters per thousand, I’d be very, very surprised if this 10 had left the industry. What I will tell you straight-up is this: Blogging and presenting at conferences doesn’t make the majority of us a penny . . . but actually recruiting and filling critical assignments does.
Gore Vidal made the following quote prior to our recent pres election: “Half of the American people have never read a newspaper. Half never voted for President. One hopes it is the same half.” My guess is that, when it comes to the recruitosphere, it’s the recruiters who have never read a recruiting-related blog who are more likely to be gone already.
Anyway, this is a moot point because my post here is about overall headcount, not overall headcount of people who have written a blog post in the last 12 months. I better run so I can go get another sip of the Kool-Aid . . . I mean Grapefruit Juice
P.S. Michael who? Michael Clayton? Michael Jordan? Micheal Jackson? Michelangelo?
Diet has a great influence on one own life and personality. It is the diet which makes the person fit and healthy.
Mark Alter
mayo clinic grapefruit diet