Predictions for 2023; Recruitment Edition

Anyone else still think it's 2020?

If you do and are still using the 2020 Playbook in 2023, you are in for a rude awakening.

Gen Z will account for as much as 27% of the workforce by 2025, a number that will only continue to grow as the most populace generation comes of age. That's significant. Rolling into 2023, finding ways to attract and retain this talent will be crucial to organizations success. This is why I think Gen Z will be a leading factor to the Recruitment trends of 2023.

More Transparency

We've already seen a major shift to pay ranges on job descriptions, some geographies requiring it by law. Pay transparency is going to be on the rise in 2023. Not including a pay range on job postings is going to become a major red flag for applicants, to a point where they might not even apply to these postings. With pay transparency, what will this do to salary levels? Because employers are going to be able to advertise their salary ranges, they are effectively the ones setting the price. Some talent will be able to negotiate above the range, but publicly displaying salaries will give some control back to the employers thus bringing down or at least slowing down the recent rise in pay rates.

More Hybrid, Less Remote

No need to panic. Remote is here to stay, but not for all. As the honeymoon phase of the remote work lifestyle begins to wear off, I believe 2023 is the year people start to crave that human face to face interaction and we see an uptick in hybrid work models. The failure to launch of the Metaverse is a great indicator that we just aren't ready to cut out physical interactions yet. People will still want the flexibility to work remotely, but will become far more open to periodic on-site work. This will limit talent pools once again back to local geographies, shrinking the candidate supply, and raising difficulty levels to fill these vacancies.

More AI Technology

While Recruiters will always be around... I hope... AI is going to continue to make a push in the world of recruitment. Rumours and myths of the infamous "ATS bot" could suddenly become very much a reality. Now, there are many industries where such technologies couldn't offer the same results as a human recruiter, but for higher volume and simpler requisitions, AI could most definitely become a larger player in the recruitment industry. Unlikely to phase out recruiters all together, these technologies will become a more common tool. Companies like Amazon already rumoured to shortening their Recruitment teams as they look at alternatives.

"According to an October 2021 internal paper labeled as “Amazon confidential,” the tech giant has been working for at least the last year to hand over some of its recruiters’ tasks to an AI technology" - Jason Del Rey

Less Hours

As the shift to work-life balance continues, I believe we are going to see more companies experiment with things like Unlimited PTO, half-day Fridays (or 4 day work weeks), reduced weekly hours, or project/task based commitments rather than hourly based commitments. Candidates (Gen Z or not) want it and will move to companies that offer it. I also think that more employees will feel empowered to take their vacation days. With such a focus on mental health, people in general have become more aware of their limitations and learning to rest when they are nearing them.

Less Boomers

It's simply a fact. As Gen Z roll in, Boomers roll out. Boomers were notorious for the live to work mentality, climbing the corporate ladder by working in overdrive, and sticking with the same employer for their whole career. In Canada, the average tenure across all industries has been hovering around the 100 month mark (approx 8 years) between 2001 and 2021 . As Boomers begin to move on, I see a dramatic shift here as Millennials and younger take over more of the workforce. As 2021 was coined the Great Resignation, we'll continue to see shorter tenures to become the norm.

Less Layoffs

Could it be so? Call it optimism, but I'm crossing my fingers that come the latter half of 2023 will see the mass layoff trend begin to slow down. It's no secret that tech companies went through some serious hyper growth throughout the pandemic to then being absolutely decimated in 2022. While a number of the organizations have cut staff, we'll likely see some more early in 2023 before finally slowing down by summer of next year. Will we see the pendulum swing back to rapid growth again? Likely not. But will we see hiring pick up?... time will tell.

What does this mean for Recruiters?

Whether you are internal or external, Recruiters will still be needed. As tech companies went through mass layoffs, internal recruitment (50%) and HR non-recruiting (48%) departments were the most impacted. This has caused a huge surplus of available recruiter talent, where I see majority likely to make career pivots sooner than later. Because these departments have been severely impacted, as companies look to hunt out new talent, I believe we'll see a rise in the use of external recruitment services. It'll be more important than ever for organizations to partner with the right resource. When using outside talent, companies are relying on these agencies to represent their brand, culture, values, and process.

Because of the great shift to Gen Z talent, just like organizations in general, recruiters are going to have to adapt. They will have to be more in tune with DEI practices, become more transparent with salaries, take on more of a consultant standpoint, utilize AI and agile workflows, and focus on asking questions about what the candidate truly wants.

Most of this newsletter was written based off my personal thoughts and opinions after 4 years experience in the recruitment industry. I try to back my opinions by supporting articles and statistics. I say this because I enjoy hearing other perspectives, as it's impossible to accurately predict the future. This is an open invitation to share your thoughts and hot takes for 2023.

What do you think the recruitment industry will look like?

Do you agree with me or am I still stuck in 2020?

Signed,

Jesse.