Saturday, April 30, 2011

Memo To Hiring Executives: The Market Has Shifted

While the national unemployment outlook teeters at 9.2% and California's unemployment rate "improved" by dropping from 12.4 to 12.0% in between January and March, there are indicators in the technology sector that the talent pool is contracting and it is becoming a "buyers" (candidates) market. We are even seeing companies do unnatural things to keep key employees. No, I am not talking about Google's $5,000,000 retention bonus package to keep an engineer from going to Facebook. Not an urban really did happen. I am not talking about Google giving every employee a 10% raise last November in addition to the free food. 

What we are seeing at TVG Executive Search is that progressive companies are locking down key talent by offering more incentives (options and or cash). They are promoting key employees because these are the valuable people that most likely survived the meltdown in late 2008 and now the companies are hiring back people in every department. These new employees need to be managed and many of these management positions are being filled from within. These are defensive moves to prevent experienced producers from leaving. Is it working? Yes, in many cases. In many other situations the candidates are going on the offensive.

The "passive" candidate of yesterday is now the aggressive candidate in today's market. If they don't see more upside with their current employer, they are willing to take more risk and move elsewhere.  Two years ago it was hunker down. This year it's saddle up!

What is an employer to do? The first step--face reality. Accept it. The market has shifted and you are behind the curve. Now, catch up. Don't listen to that Board Member who continues to blather on that "Unemployment is so high! Everyone is out of work! You can get people on the cheap!" Politely smile, tolerate the same bad joke he tells at every board meeting and get back to the business of building a world class company.

The second step--develop specific talent retention and acquisition plans.  What should be in these plans? This will be the subject of my next entry. I don't want to give you too much at one time. Accepting the market reality will be challenging enough. So, let's do a quick meditative exercise. Close your eyes. Repeat after me..."I accept the market as it is today, not what thought it was or told that it is...but what it really is now". Now, don't you feel better!?  

Your new motto is "Get over it and get on with it!"

Until next time.....