2023 has been a very unpredictable year for the labor market, and much uncertainty remains as we head into 2024.
Economists have differing opinions about what will happen in the employment space. The Congressional Budget Office is predicting that through the end of 2024, the growth of employment will wane and the unemployment rate, which has been very low from a historic perspective, will rise. Also, the labor force participation rate will decline as more and more baby boomers retire, and the growth of wages and salaries will slow.
Even though the job market has been cooling or loosening over the past few months, a large gap in supply and demand still exists. Recruiting for workers in high-demand areas will still be challenging, even as job growth may slow. Employers competing for hourly talent will still have fierce competition as retail, hospitality, and food services are all vying for similar workers.
This is why companies need to focus on recruitment trends and what they can do to hire the talent they need in the upcoming year.
Due to this, companies will need to evolve their hiring practices to open up key talent pools as the supply/demand gap widens. This is why skills-based hiring will continue to rise in popularity.
Skills are 5x more predictive of job performance than hiring for education. Indeed shared at their Future Works conference that 2 million job seekers were searching for jobs with “no degree required” in the first half of 2023. Opening up the hiring practices to screen in for skills versus a degree requirement (for the positions it makes sense for) can increase a company’s chances of filling the open position.
Attendees of Indeed Future Works or LinkedIn Talent Connect likely noticed that AI dominated the conversation. SIA, which is a leading authority in staffing, also shared during their conference in September results from a survey of industry experts on the topic. Data showed that AI will replace 25% or more of the following activities within the next three years: candidate screening and assessment (91%), matching and selection (91%), and redeployment (82%).
The rise in AI is dominating product enhancements heading into 2024 as well. Companies are aggressively focusing on AI and quickly evolving their offering. Innovations announced at LinkedIn Talent Connect can be found here, and a few of Indeed’s exciting updates include AI-powered candidate highlights (currently in Beta), AI-powered messaging (currently in Beta), and AI-powered job ads. Also, in 2024, additional enhancements to smart sourcing will also be released.
Note: Recruitics is leading the way in the AI space. At HR Tech, Recruitics rolled out an AI chatbot that clients can use to help interpret performance data.
Due to this, it will be important for recruiters to be aware of these changes and how to implement them into their workflows. Also, figuring out how to use AI responsibility will be critical. AI has inherent human bias, so if used inappropriately, it can increase barriers and negatively impact diversity and inclusion. As innovations in the field continue to emerge, it will be crucial for companies to ensure that the data they use to train AI is of high quality.
Candidates care about wellbeing and culture, and industry-leading platforms are pushing companies to care too. Indeed recently launched Work Wellbeing Scores, and they also announced their first-ever better work awards, highlighting the companies with the highest scores. Indeed has also rolled out badges that can be added to jobs. A few badges brought front and center are the ease to request PTO, caregivers being supported, annual floating holidays provided, maternity leave satisfaction, inclusive environment, and supportive management.
Candidates have an increased desire for flexibility and remote work. According to Indeed, Job seeker interest in remote work remains at an all-time high, though the share of postings for remote or hybrid has fallen in most sectors. Also, a Greenhouse report shares that (76%) of candidates say they would actively search for or be open to a new job if their company rolled back flexible work policies, and 42% of candidates will not apply for a role if it doesn’t offer their preferred working model.
Candidates also want to hear back quickly and want the process to be easy. According to Indeed, candidates who hear back from employers within four hours are 95% more likely to accept offers than if reached out a week later. Also, 80% of respondents said they wanted faster response times from recruiters.
JobVite shares that the most disliked aspects of the job application process for candidates are having to redundantly input resume information, the lengthy application process, and the requirement to register before applying. Companies that prioritize sending timely and personalized messages to candidates can significantly improve their engagement rates.
Authentically showcasing the employment brand helps to recruit quality talent and reduce the mis-hire rate. This can be very costly, with the author of TopGrading sharing that the estimated cost of a bad hire ranges from five to twenty-seven times the amount of the person’s actual salary.
Given the evolving expectations of candidates, it's essential for companies to ensure that their brand messaging genuinely addresses the needs of candidates. Showcasing the authentic company culture is what candidates seek. Candidates want to see how the company is mission-driven, what its core values are, and what its stance is on social responsibility. According to Lever, 42% of Gen Z cares about mission and values over salary.
Candidates also care about diversity. Fifty-three percent of US workers say diversity, equity, inclusion, and belonging (DEIB) is a key factor when considering a company for employment. DEIB efforts are substantially more important for younger workers, with Gen Z at 77 percent and Millennials at 63 percent.
Employer brand isn’t just about the top of the funnel – but it needs to flow through the entire cycle. Outside of talent attraction, the EVP needs to shine through during onboarding and reflection after a hire decides to leave.
Bamboo HR shares that 70% of new hires decide whether a job is the right fit within the first month, and companies have on average 44 days to influence long-term retention. Ensuring the EVP flows through the onboarding process is critical for retention.
Workers who don’t have a good experience will talk louder than those who don't. New platforms like Bowls on Glassdoor provide an anonymous space for more conversation to discuss workplace experiences. Having a strategy in place for joining these discussions and monitoring and responding to feedback left on employer profiles is essential.
Source diversification is another important aspect of recruitment strategy that will continue to be important into 2024. It reduces risk on just one vendor and widens the net for the type of candidate companies may be able to reach. Google Job Ads, Bing Ads, TikTok, and hiring events are all top of mind for diversification.
Google Job Ads are currently in Beta and projected to go live for the public early next year. Most people by now recognize how important Google search is to a recruitment strategy, and 73% of job applicants start their search there. Recruitics sees that some clients have CPAs on Google that are similar to what they see on job boards. It’s a foundational source to run alongside programmatic.
Tip: It’s advisable to ensure hiring professionals are set up now for this to go live. This includes setting some budget aside to test it and ensure they have a direct feed going to Google.
Bing Ads are often underutilized by employers. The unique thing about Bing is that companies can pull in targeting from LinkedIn. Its precise targeting and new ad formats announced will be something to watch. The total share of ad spend on Bing is growing, and next year, Bing is expected to see 16.6% YoY growth in revenue.
The growth in TikTok has skyrocketed, and some are using it for search these days over Google. Ad spend is following suit, with forecasted ad revenue jumping from 18 billion in 2023 to almost 54 billion by 2027.
TikTok is becoming more and more foundational to recruitment marketing strategy. Recruitics has seen a lot of success with TikTok campaigns, and recently partnered with TikTok to publish a case study about how TikTok Lead Generation ads can increase qualified leads.
Note: One of the biggest challenges the Recruitics team always hears from prospective clients who are on TikTok is just having the content that performs well. Recruitics offers a workshop for customers on this topic if hiring professionals want to take a deeper dive and learn more.
There’s a resurgence in hiring event success. In particular, running virtual or in person hiring events through the Indeed hiring events platform, coupled with promotion on other channels (first and foremost social channels), but digital if the budget is big enough can help drive success.
Beyond Google Job Ads, Bing Ads, TikTok, and events, new and other ad formats will emerge, and companies should plan within budgeting to pilot. Things like Twitter Job Ads (currently in beta) and other emerging platforms (like Threads) might offer viable options to test.
In summation, 2024 is sure to be an interesting year. Uncertainty in the job market will remain and labor shortages will persist. Responsible AI will dominate many of our conversations, and high candidates' expectations will drive employers to implement positive changes to benefit workers. Branding and messaging to job seekers will be top of mind, as well as diversifying sources to reduce reliance on just one vendor partner.
Are you looking to enhance your recruitment strategy in the current year? Don't hesitate to contact Recruitics, where you'll find a team of industry-leading thought leaders ready to assist your brand in excelling in the evolving landscape. Our approach incorporates real-time data, enabling us to adapt, innovate, and cooperate to make your recruitment process more precise, intuitive, and efficient, ultimately helping you attain your hiring objectives.