If you google ‘job market in 2024’, you’ll find conflicting opinions on where hiring will be in 2024.
Some sources, like Forbes say it will get better. Others that hiring will slow down.
Across the board the feeling is that the worst is over. Hiring data and the Fed not raising interest rates suggest that. After hitting the bottom in April, open jobs have started increasing again, although at a slow pace. Vacancies have fallen 65% since 2022. Now they sit at -61%.
In the last 6 months layoffs have fallen to 2022 levels. That’s a better hiring predictor, since with less layoffs, job openings will compound.
Higher interest rates are forcing companies to rethink their tech & digital strategies and I doubt we’ll go back to 2022 mass tech hiring. From what I’ve seen companies haven’t taken a “quality over quantity” approach either. At least not yet.
In the last 10 years, they have copied successful approaches. So once a company gets big with a quality over quantity approach to hiring, they’ll all go for it. Will it happen in 2024? I think it would be too soon. We could see it begin at the end of the year though.
Talent will remain scarce
Even if we are in a downturn, unemployment remains low. Most western countries are around their 10-year minimum.
Look at this chart of UK unemployment, which is reportedly having a bad year.
Other european countries follow a similar pattern - a 10-year low in 2022 or 2023, followed by a small increase. The US, however, experienced a smaller increase, and is in a downward trend again.
Low unemployment is not the only reason though. Companies continue to prefer people with similar profiles and rule out outliers. The downturn provided an opportunity to rethink that. Instead, they’ve doubled down on hiring more of the same.
This hurts hiring particularly in tech. I don’t have a chart for it, but I recall reading a statistic that IT junior openings have disappeared. It’s not hard to imagine that when demand will rise, finding engineers will be impossible.
There’s one more reason talent will remain scarce. The gap between what top talent and companies want. You’ve seen it in the form of remote work vs hybrid, but that’s just the most common point of discussion.
Companies will have to be more flexible
Unless a company offers what they want, it will feel more like headhunting than recruiting. I’ve seen the shift already.
Consider this. Factor in a location, 2-3 skills with few years of experience and a salary range. Then filter it down to people that want to change job and remove those that don’t answer. How many candidates are you left with?
Companies remain picky though. And since the talent pool isn’t going to double overnight, companies will have to be more flexible. If you know a company is picky about skills and experience, you might want to pass.
Candidate experience will be even more important
2023 saw recruiters reputation take a hit. It was already poor, but the tough market made candidates even more annoyed. They have realized how important working with a good recruiter is, particularly when things are hard.
It’s not like recruiters didn’t do their worst either. In 2023, I’ve seen some of the worst of recruitment practices of the last few years.
Even if you’ve been on the good side and didn’t ghost anyone, it will be hard to get the candidates’ trust. Recruiters will have to put active effort in their branding - and deliver on what they promise.
Companies might end up short of recruiters
A lot companies, including Google, laid off their internal recruiters, the expectation being that their hiring needs will remain low.
That may be true in terms of volume. However, with time to hire increasing across the board, recruitment will remain a significant effort. If there will be a modest increase in openings, they will be short of recruiters.
The downside is that some of the laid off recruiters have switched to freelancing, so until that increase happens you might face more competition.
How Rune HR can help you in 2024
At Rune HR we just got started and we have big plans for 2024.
In December we have collected feedback from recruiters on what would they would like in an ATS. Over the next months, we’ll add the most requested features. We have some cool ones of our own too.
If you want to know more, reach out and we’ll be happy to see if we can help you.