When did hiring get so complicated?

When did hiring get so complicated? Has it always been a struggle for both sides?

Today, more than ever, there seems to be a widening divide and disconnect between businesses and job seekers. Businesses generally exist and grow by conceptualizing ideas to solve customer problems, providing value in exchange for compensation. As companies grow, they need to hire people to help solve more complex problems—whether those are customer-related or internal issues resulting from growth in sales, marketing, operations, accounting, HR, legal, etc.

The problem is that the true business math around profitability and the true cost of employment aren't widely taught. They’re certainly not being shared by the government or through the public education system, and it doesn't seem like they’re even being shared through post-secondary institutions. A Harvard Business Review study showcased that a $55,000-a-year employee has an approximate operating expense and net cost to an organization between $75,000 and $100,000. This includes government burdens like CPP, EI, WCB, vacation pay, employer health tax, benefit plans, health and wellness plans, government-mandated sick days, statutory holidays, training, onboarding, performance management, coaching, technology, and a prorated calculation of general business costs.

In retail, for example, an item purchased at $1 is generally sold at a minimum of $2, carrying a 100% profit margin. Depending on the organization, a 100% to 200% margin on sales is required to achieve a 10% to 20% profit margin on goods sold. With this in mind, an individual earning $55,000 a year needs to directly generate more than $100,000 to break even and likely needs to generate $200,000 to $300,000 to ensure their employment is profitable for the organization.

I work with hundreds of organizations every year and we've placed people with over a thousand Vancouver-based companies since our inception. For the most part, companies want to hire great people. They may have some non-negotiable expectations for a particular position requiring a certain skill set, knowledge, and background, but they are generally open to hiring good people. The challenge is that employee expectations continue to evolve, and what were once viewed as significant perks and benefits are now seen as entitlements and expectations. This further increases the net cost of employment, making organizations second-guess the needs of the business, which in turn increases the requirements and expectations of potential candidates.

The world is changing rapidly. The pandemic was a catalyst, social media has created greater transparency, and organizations innovate at record pace as technology advances. The recruitment process itself hasn't changed drastically in the past 15 years. What has changed is how badly companies have been burned by bad hires, how easy it is for people to apply, how the view of employment has shifted, and how the expectations of job seekers have shifted. As a result, companies have had to invest much more to protect themselves, building barriers with hoops and processes that job seekers need to jump through—processes that may or may not add value.

What remains the same today is the need for laser clarity on the needs through a very focused and detailed intake process, and then running the recruitment process with rigor and urgency to ensure that great candidates aren’t missed.

Companies want to hire great people, and job seekers want jobs. Companies are fighting every day to adapt and meet the needs and expectations of the market, and job seekers are struggling to keep up. If you're a business out there that's hiring and having a hard time finding the right people, you're not alone. It’s harder than ever to find the right people. Job seekers are struggling just as much.

The process hasn’t changed, but the most important thing I share with our clients is getting clarity on your direct and indirect competition when posting and advertising for a new hire, understanding your company's marketability and social presence, the available talent pool you’re targeting, and what the ideal candidates are looking for when making a change. This is a critical first step before posting a job, screening applicants, interviewing, and making an offer.

I offer free market analysis sessions—no bait and switch, no sales pitch, no expectation of doing business with us. In 15 minutes or less, I can help companies understand the factors they’re up against, whether they hire through us or not. If you're hiring, thinking of hiring, or struggling to hire and might benefit from some market visibility, don’t hesitate to reach out. We’re on a mission to help companies hire great people.