US.Jobs site with social elements displayed

In a blog post about yesterday’s DirectEmployers meeting, publishing industry analyst and consultant Peter Zollman called it “a valuable information session.”

Recruitment consultant Gerry Crispin, who attended this morning’s second session, described it as a useful meeting that left him “very satisfied that the intent (of the creation of the dot-jobs domain) I have consistently written about … is reflected in what DirectEmployers is doing.”

The meetings they and a few others — perhaps a dozen in all — attended in Indianapolis were called by the DirectEmployers Association to answer questions and explain the non-profit recruiting consortium’s plans to build-out tens of thousands of recruitment sites all with an Internet address ending in .jobs.

Zollman reports in his blog post that next week 25,000 of the sites will go live. The “number will increase exponentially on an ongoing basis,” writes Zollman, until every community in the U.S. over 5,000 population has a job site for itself.

Those geo-focused sites will be supplemented by occupation-specific jobs and, where there is demand, geo-occupation-specific sites. The number could potentially reach the millions, says the information site for the project, Universe.jobs. Some of these sites launched a few months ago in beta. Here’s one for Atlanta and one for sales jobs. Other sites are detailed here.

Crispin, an early supporter of the creation of the .jobs domain, said he was encouraged by the focus of DirectEmployers in the development of the recruitment sites. “DirectEmployers intends to focus in on how to build it out as to how ICANN intended it,” he said.

(ICANN is the Internet group that decides naming conventions and authorized .jobs, a top-level domain. Details of the request by the Society for Human Resource Management and Employ Media to ICANN to create the domain can be found here.)

Crispin explained that the job listings on the DirectEmployers sites will all be real jobs from real companies, which was one of the goals in creating the .jobs domain. Another was to make it easy for job seekers to find corporate career sites. But in all cases, in order for a .jobs address to be awarded, the company had to agree to abide by an ethical code.

While what DirectEmployers is building looks and sounds like job boards, Crispin said it’s not. “At the end of the day, it’s not job boards … It’s something more.”

He was boarding a plane out of Indianapolis (where the meetings were held) so he didn’t have  much of a chance to explain. But looking at the .jobs sites, it’s clear they have evolved from their first iteration back in October. There’s a social element to them and a connection into social networks. Click into the FOLLOW tab in a job post and you can get a listing of employees on LinkedIn.

The project may well continue to evolve. Crispin said its future is “not set in stone.”

At the same time, CEOs and VPs of HR complain about how hard it is to find good employees and retain them. It seems obvious to me that we need to invest more in employee education and less in other areas.

It is a strange and almost uniquely American trait to dislike learning and limit an employee’s ability to learn by not providing time or money.

In most other countries, organizations or governments subsidize or reimburse employee education to some degree. They almost all provide significant internal development even when times are tough. Toyota and many Japanese, Chinese, Singaporean, and Korean companies increase spending on developing employees during bad times because there is slack time to do so.

Moreover, American firms almost universally limit the amount of money that can be spent, they require the employee to pay back the expenditure, or they demand a minimum length of service before eligibility.

This has always seemed strange to me. Learning improves the entire workplace and cxreats more skilled workers. If everyone developed employees, losing a few would be offset by the ones you hired to replace them.

But let’s take a look at this whole concept in some depth.

First of all, there is no doubt that historically a degree has made a difference in the level of the position one could attain, as well as in total lifetime pay. And, the higher the degree obtained, the higher the status and often the pay (teachers and professors excluded).

As that is still true for the most part, wouldn’t it make sense for employers to encourage employees to get degrees so that they could earn more, feel better about themselves, and potentially contribute more to the organization? Any employee who voluntarily decides to go back to school must be motivated and capable. Many of them may not have had an opportunity to go to school when they were younger for economic or family reasons, or they may have now become more mature and motivated to learn.

In fact, they may be the best employees a company has, as they have tons of energy, are motivated, and seek to contribute more to the company. Organizations that recognize this and encourage and support the ongoing development of their employees have the lowest turnover and highest productivity.

And, what does this cost an organization? Perhaps in an extreme case, where an employee has to go to the equivalent of four years of college to get the degree, the total cost might run as high as $75,000 — roughly what a mid-level manager gets in a large national corporation in a year. Roughly what the executive search fee is for one senior level executive. Roughly what it costs to replace a $30,000-a-year employee (using a standard of replacement cost equaling 2.5x salary).

That doesn’t seem like a lot to me, and more importantly, it seems like a fair trade. The organization gets to keep and nurture an existing employee, making them more productive, useful, and loyal, and avoids the need to use recruiters or search firms and then assimilate a new employee. The chance that a new employee will not succeed is high as are the training costs. Yet, if a new employee quits, no one asks them to pay back the costs involved in recruiting them. Search firms may refund their fee, but more likely they will bargain to refill the position at no additional cost.

So in my way of thinking, organizations should encourage all employees to continue their education. They should offer internal programs and make attending them part of the performance appraisal process. If more organizations focused on promoting internally, rather than going to the outside except for entry-level people, they would have a much stronger and more capable workforce. I frequently use IBM as an example of this. It has spent billions of employee development and prides itself on allowing employees to move internally easily and often. And IBM is thriving despite a recession and despite having changed its entire business model.

By encouraging people to pursue degrees, a company gets the benefits of their increased skill and motivation while they are in school as well as after they complete the degree. The employee doesn’t magically become smarter or more useful to the company only after completing their studies. The skill growth is incremental and takes place over the entire time they are students. Forward-thinking organizations recognize employees at the beginning of their studies and strive to find challenging positions for them in the organization. They may offer rotations or other opportunities for these students to contribute right away.

Companies could work with the schools and tailor degrees to their needs. They could work out ways that student course electives could actually become internal projects that would benefit the company. Or they could work to get term papers and theses written that would be of interest and use to them. Most schools that I have worked with will consider these things when approached by responsible and caring internal representatives. I have set up numerous degree programs with local universities and colleges that provided the employees with course content that they could immediately use on the job. Professors were encouraged to learn more about the company and about its needs so that they could tailor content and even create case studies based on the events in the company.

In most of these programs, the organization assumed all the costs for the education, including books, fees, and tuition. If several students were pursuing the same degree, the company purchased books for them through wholesale channels and even negotiated reduced tuition fees. There is a lot a determined and resourceful human resources group can do to lower costs and improve the quality of the education the employee gets.

Organizations that are positive, encouraging, and supportive of employees who are trying to better themselves will have lower turnover rates, make more money and have a better public reputation than those who don’t. The cost of tuition reimbursement programs is small compared to the benefit and a more liberal approach to tuition reimbursement and on-going education, especially when recruiting new college grads, is a powerful recruiting tool. It’s a way to differentiate your organization from others.

Investing in education should be a priority and should supersede other benefits and bonuses.

I get nearly free health care and pay only a pittance (relatively) for great child care. My cost for education is small. Since I work on average, 35 hours a week, I have time for my family and recreation, which includes free gym access and a summer camp for the kids. Oh and I have no fear of being laid off.

So who am I? Did you say citizen of Sweden or some similar place? Nope. I’m an employee with SAS, America’s best place to work, as declared by Fortune magazine.

Fortune’s annual list of the “100 Best Companies to Work For” was announced last week and is published in the Feb. 8th issue of the magazine. Not a lot of surprises on the list, though NetApp dropped to seventh place, probably because of its layoffs. That opened the way for SAS, which has never had a layoff, to claim the top place.

Fortune has been producing this list for 13 years and SAS has been on it every time. It’s the first time SAS was ranked #1, though the company is regularly in the top five or 10 best companies.

Last year’s second place winner, investment firm Edward Jones, held onto the spot. One of the few financial firms not to have had layoffs, it did sell its British unit and froze salaries, but managed to continue profit sharing.

The listings and the short corporate synopses highlight benefits and pay. Fortune doesn’t forget to mention the little things that help define a company culture. Things like executives at Nugget Market washing the cars of associates at an employee appreciation event, and how loyal animators are to the collaborative spirit and openness at DreamWorks Animation, which, incidentally, catapulted from 47th last year to 6th.

Fortune also highlights six of its top 100 companies that have never had a layoff.

Monster ad from Wired

Monster fired the first shot in the ad wars Sunday with a commercial during the AFC championship football game featuring the Boogeyman and a new tagline.

Bad at his job scaring children, the Boogeyman searches Monster and finds his perfect fit as an accountant. As he settles into his cubicle, the words “New precision job search” appear followed by the tagline, “Get a Monster advantage.” The new tagline replaces “Your calling is calling.”

Precision Job Search is the branded seeker product powered by Monster’s overhauled back-end search engine. Power Resume Search is the recruiter version. Both come out of beta on Feb. 2, the official launch date of 6Sense, the branding Monster is applying to the semantic search engine it built out of technology it acquired when it bought Trovix.

Over the last year+ Monster has been introducing new career-focused tools and features, like its career-mapping service and social communities organized around professional careers.  Over the summer, it tested its semantic resume search with a number of recruiter clients, then began offering it and the seeker search as options in the fall.

After a demo of the search tools in November, I wrote “Power Resume Search is stunning.” On the seeker side, I’ve found Precision Search (Or is it PrecisionSearch. Monster references it both ways.) to be an equally big improvement over “Standard Search.”

Now, Monster is making a full-court press (or should that be a blitz) to promote 6Sense and the other features. Monster will air a second commercial, this one featuring a beaver, during the Super Bowl, and will also announce its choice of a new Director of Fandemonium during the game. Print ads in tech and business magazines like HR Executive, Wired, and Fast Company have already started running.

“This isn’t just the launch of an advertising campaign. It represents a commitment to help people make clear progress in finding the right job,” says Ted Gilvar, executive vice president and global chief marketing officer at Monster. “We know that people want help — whether it’s a more efficient way to search for jobs or helping them connect with others through specialized career networks.”

CareerBuilder will make its sixth Super Bowl appearance with an ad selected from among those submitted in a contest. Three commercials were eventually picked out of some 1,000 entries and were each awarded grand prizes of $100,000.

The idea was that the public could then vote for their favorite, which might be selected as the one CareerBuilder airs as its second quarter commercial. However,  one of the three — Worst Seat — has been nixed by the network. The commercial is pretty gross, showing a cubicle worker entertaining (some) of his colleagues by passing gas. So, of course, that’s the video embedded here.

“CareerBuilder has had a very successful track record with advertising in the big game and we are confident that all three concepts selected would play well with the big game audience,” said Richard Castellini, the job board’s chief marketing officer. “We made a strategic decision to change our advertising approach and leverage the creative minds of consumers across the country. Our decision paid off when we were flooded with a large number of very high caliber ideas, which played a major role in our decision to pick not one, but three.”

A company spokesman told me, “We have not announced any plans for our marketing past the big game.”

Again, change comes in a variety of forms:

• New technologies (like job boards or applicant tracking systems) can shift the relationship balance between employer and employee
• New techniques (like behavioral interviewing and Internet sourcing) can change the selection process
• New ways of doing business (like outsourcing) can change the volume and complexity of recruiting relationships
• Shifting economics can change the demand equations, making some skills more valuable than others
• Demographics can alter communications goals and processes
• New information management Ideas (like open source, wikis, or public resume databases) change the competitive intelligence aspects of the game
• Technology disruption can eradicate an industry, creating a surplus of potential employees who don’t quite fit
• Fads and voodoo (handwriting analysis is a popular assessment tool in some places) shape some companies perspective

There is a Darwinian process for figuring out which technologies work and which fail. The team that fields the best technology, marketing, and sales combination gets to fight the next battle. Market dominance is rarely evidence of product quality alone. It’s usually a blend of of a pretty good product, super marketing, and relentless sales that distinguishes the winners.

As we start to look at the ways in which recruiting might change, it’s important to have a shared perspective of the market. The following map is one way of looking at all of the possible recruiting entities in the domestic American economy. It’s a grid representing all of the establishments in the United States that hire people. There are about 7.5 million of them. (The number is somewhat smaller due to the downturn so I’ve used percentages.)

The vertical axis is marked at the 80 percent, and 95 percent points. Eighty percent of all companies have fewer than 100 employees; 15 percent have between 100 and 500 employees, and 5 percent have more than 500 employees. If you squinted, you could see the 1,800 companies with more than 5,000 employees. Each of these groups handles recruiting in relatively different ways.

The sub-100 crowd rarely uses formal systems to recruit. For many, it’s not really very likely that there’s an HR system much beyond payroll and benefits. Word of mouth and local referrals dominate the hiring process. This is one of the arenas in which Craigslist is very strong.

The sub-500 group is where formal systems start to matter. The recruiters are as likely to be an HR generalist as they are to be a competent professional recruiter. Much of the mom-and-pop contingent search business operates in this sector.

Above 500 employees begins to be enterprisey. As companies get larger, procurement processes become more formal, HR gains authority and credibility and IT infrastructure begins to be a serious investment. The squint level (5,000 and above) companies are a rarified environment.

The horizontal axis is marked at 60 percent and 90 percent.

Sixty percent of all companies (more or less) use reactive street-level HR structures that are designed to solve crises. Almost perfectly administrative, these operations are the holdouts from the era of the personnel department. HR is for payroll, absolute minimum regulatory compliance, time keeping, benefits administration, and old-fashioned hiring methods. The bottom-left-hand corner of the matrix is darkened for two reasons. First of all, this is where most job creation happens. Second, recruiting, as it is described in any sort of professional literature, basically doesn’t happen here. Hiring is done by word of mouth, local bulletin board advertising, Craigslist (maybe), and asking around (the low-level referral system).

Thirty percent of all companies have SHRM members. HR and Recruiting work hard to be proactive and strategic. This is the world where the HR person aspires to a seat at the table. In the sub-100 companies, recruiting is done by the executive team and HR means a good work environment and great benefits. For the smallest HR operations in this category, SHRM is the HR training department. Above 100, the HR department is earnest and hard working with a new found tendency to focus on measuring and improving their processes.

The final 10 percent on the horizontal axis are the places where the human capital function is transformative. The recruiting and other HR functions deliver business results and impact. They expect to be involved in executive decision-making and wonder what the all that fuss about the table is about. They do their work in the golf cart. In this segment, analytics is catching on and people are starting to wrestle with data-driven, evidence-based systems. Below 100 employees, much of the HR function is outsourced and key hires are handled, with a good chunk of analysis, by the executives. Between 100 and 500 employees, the systems formalize and, again, resources are expended to make sure that the best systems and tools are used. Above 500 employees in this sector, things get really interesting. When human capital is seen and used as a business weapon, remarkable things happen.

The employment marketplace is vast. Over seven million firms employ 120 million people (the rest of the workforce works for the government). The black square represents the 24 million people in about 4 million companies who don’t use recruiting per se. The rest of the market is the ‘formal’ recruiting market.

So, how’s the picture? Do you think this is an accurate picture? Is there another way to portray the market?

I find the picture useful as a way of explaining how some things work. Economic pressure bears down on the top of the matrix. One way of thinking about the economy is that the thin strata of big companies are where money flows from into the smaller establishments in the food chain.

Technology adoption is a different story. It comes into our market from the right. The companies with transformative HR are almost always early technology adopters. The next 30 percent follow the best practices of the innovators. The remaining 60 percent buy technology when there is a rational dollars and sense argument.

Make sense?

I hope you’re enjoying this buildup to the ERE conference. Pinstripetalent has been kind enough to sponsor the work and research that makes the project possible.

But the participation of Hispanic-Americans in the federal workforce is a different story. According to the latest data (2008) from the U.S. Office of Personnel Management, Latinos make up barely 8% of the Federal workforce. In recent years, a number of high-visibility initiatives have been directed at the challenge of Hispanic participation, but the numbers continue to lag. Despite their seeming best efforts, Federal agencies have generally made little progress in recruiting and retaining Hispanic employees over the last decade.

At TMP Government, this situation has puzzled us as well. In the March Journal of Corporate Recruiting Leadership (ERE’s print publication geared at recruiting leaders), we lay out a seven-step suggested solution to the problem.

For now, though, we’ll kick it off online by suggesting a few possible causes and symptoms of the government’s apparent failure to make headway on this challenge.

Statistics Tell the Tale

Again, Hispanic-Americans are the largest and fastest-growing minority segment in the U.S. By all predictions, this trend will continue at least through the first half of this century. As of its last estimate (2007), the U.S. Census Bureau pegs the median age of U.S. Hispanics at 27.7 years, compared to 36.8 years for the rest of the population. And almost 34% of U.S. Hispanics are younger than 18; for the population as a whole, only 25% of Americans are under 18. By 2050, again according to the Census Bureau, Hispanic-Americans will make up nearly 25% of the total population.

These predictions promise significant implications for our culture and economy — not to mention the U.S. labor market. Overall employment numbers in the U.S. are already showing the impact of this accelerating demographic shift. Since 1980, the American labor force has grown by more than 41%. Fully a third of this increase is accounted for by Hispanics.

Human capital professionals in the corporate world appear to dealing effectively with this groundswell of Hispanics in the general workforce, and are diligently preparing for the new HR imperatives it will bring in its wake. But this is not the case with government human capital leaders. We have one question for them:

Why is the Federal government’s track record of recruiting and developing Hispanic employees so bad?

Across the board, the feds have managed to achieve only 7.8% participation by Hispanics in the government workforce. And the news gets worse: Hispanic men and women today represent only 3.6% of individuals at federal senior pay levels — a proportion that drops to 2.5% when you take political appointees out of the calculation.

These numbers are puzzling, to say the least. The government has traditionally been the standard-bearer for minority participation in the workforce. Consider African-Americans: they make up 13% percent of the U.S. population and — according to the latest available count (2008) — more than 18% of the Federal workforce. Certainly we should credit most of this progress to vigorous initiatives by Federal agencies, beginning in the early 1970s, to recruit and retain talented African-Americans.

But when it comes to leveling the playing field for Hispanics in government, today’s recruitment initiatives appear to be yielding only marginal gains at best, and in some cases they are barely holding the line against attrition.

We’re prepared to suggest several factors that may be diminishing the government’s success in making recruitment gains among Hispanic-Americans. At the same time, we are identifying a number of technical and strategic measures that in our view can go a long way toward helping the government succeed in this mission. Moreover, these innovations have the potential to enrich other dimensions of Federal human capital management substantially — beyond recruitment and beyond the Hispanic-American segment.

What factors influence the government’s disappointing track record in recruiting and retaining Hispanics?

Here, in brief, are a handful of factors that may be contributing to the Feds’ apparent lack of success with the Hispanic-American segment.

Competitive Barriers From Industry

The corporate community has seemingly mastered the Hispanic recruitment challenge. Indeed it may hold the trump card here, both by reason of the resources it can devote to Hispanic engagement programs and the pay premiums it can offer to talented Latino candidates. The government simply can’t keep pace on either score. The Feds aren’t empowered to offer pay incentives based on minority status, and most agencies today don’t have the budgets or staff resources to build comprehensive recruiting/retention programs targeted at the Hispanic segment.

“Geo-Demographic” Barriers

Most federal entry-level positions tend to be in the national capital region. In the District of Columbia and the two adjacent states (Maryland and Virginia), the population of Hispanics is well below that of many other regions, especially in the Southwest and California. The “hire-able” population is simply not that deep in Washington, despite some clustering of Hispanic blue-collar workers in Washington and its near suburbs. Compounding this difficulty is a disconcerting “psychographic” factor suggested anecdotally by many recruiters: young, job-seeking Hispanics in general are less inclined to relocate, because it means leaving their extended families for new positions away from home. In the absence of family ties here, a move to the Washington area for a government job may be inherently less attractive for some Hispanic-Americans.

Lack of High-level Commitment and Resources Among Individual Agencies and Departments

Let’s face it: campaigns to improve Hispanic participation in the Federal workforce simply cannot draw on the same driving momentum in society as the widespread movement for civil rights and equal opportunity for African-Americans. From the 1960s on, in fact, the federal government was the primary institutional driver behind this movement, and a natural leader in the crusade to roll back hiring barriers impeding black Americans.

But when it comes to Hispanics and other underserved minorities, there’s neither the degree of enforced commitment nor even (so far as we can tell) a deeply felt personal commitment at high levels. Without the visible presence of management champions of the cause, there’s little incentive to build real momentum for Hispanic programs within agencies. By the same token, agency funds are rarely available to mount Hispanic programming on the same scale as earlier equal opportunity initiatives centering on African-Americans (except, perhaps, where Spanish language skills are a job requirement).

Misleading Emphasis on Recruiting for Spanish-speaking Positions and Bilingual Skills

Break down the government’s current roster of Hispanic employees and you will find a disconcerting reality: they tend to cluster in public interface positions that call for fluency in Spanish, as well as in low-paying service jobs, like maintenance and food service. In the first instance — although it’s anything but pleasant to contemplate — we’re suggesting that some agencies that need to recruit aggressively for bilingual positions may unconsciously put bilingual qualifications first when they evaluate any Hispanic-American candidate. The result: they may unconsciously filter non-Spanish speaking Hispanics out of consideration for ‘mainstream’ positions that don’t require Spanish-language skills.

We realize that this element is potentially controversial, and are not suggesting that conscious prejudice plays any part in this cycle (if it exists). But we are suggesting that maybe, just maybe, unconscious habits of mind among hiring officials could be channeling Hispanic candidates into the constituent interface track and not considering them carefully enough for mainstream positions if they don’t — or even if they do — fit the bilingual mold.

Scarcity of Agency Resources to Take Comprehensive, Top-down Action

It’s the rare individual agency or department that elevates the full cycle of Hispanic recruitment, retention, and development to a top-level institutional initiative. We have encountered few agencies that have set out to elicit engaged participation from senior leadership, the agency management team, hiring managers, and their operating components, and all units in the agency HR infrastructure. An agency that adopts this kind of vertically integrated organizational strategy would have an advantage ion recruiting all diversity classes, not just Hispanic-Americans.

There’s another flavor of integration that might also help at the agency level: effectively integrating its recruitment outreach thematically by underscoring:

• the full employment life-cycle at the agency, and
• the agency’s commitment to productive inclusion of all diversity classes in the workplace community.

Agencies that approach the Hispanic/diversity recruitment challenge from all of these integrative perspectives, it seems to us, stand a much better chance of success than agencies that revert to standard “checklist” practices of minority hiring.

Lack of Concrete, Government-wide Initiatives for Meeting This Challenge

Up until now, agencies have tended to go it alone rather than teaming with other agencies in the Hispanic recruitment mission. While surely this is due to budgetary constraints (as well as something of a competitive dimension, owing to the perceived scarcity of Hispanic candidates), it’s a less-than-effective way to tackle the challenge. In the typical agency HR infrastructure, recruiting resources are limited and/or distributed across multiple initiatives. The result: Hispanic recruitment and retention (despite the current hue-and-cry) may not attract the urgent managerial, budgetary, and strategic attention they deserve. And while a given agency may have its share of individual champions for the Hispanic cause, it can find itself without the resources and allies to gain real purchase on the initiative.

The alternative is collective effort across agency boundaries. If insularity and inter-agency competitiveness can be set aside and budget barriers cleared, this approach could create empowering economies of scale, not to mention bringing individual, agency-based champions together on the same team, where their collective talent, energy, and enthusiasm can be harnessed and channeled.

Of course, government-wide taskforces to analyze the challenge are a critical (and-all-too familiar) first step, but up to now they haven’t demonstrated the power to implement collective solutions. Luckily, today’s Office of Personnel Management is a leading champion of collective government-wide common action among agencies. OPM is developing similar programs to coordinate recruiting pools of special talent, like technology and finance, for multiple agencies to draw on for new employees. A similar initiative for Hispanic recruiting could go far to address the current challenge.

We realize that many of the influential factors we suggest above will likely stir discussion and controversy. It’s important to regard them as topics for consideration, not hard formulas. We want to inspire more dialogue on this topic, and ultimately spur progress on this very serious challenge. Again, check out the March Journal for our proposed solutions.

The parallels between that movie and the current jobs crisis are getting to be uncomfortably close. We may be heading for own version of the big W — a double-dip recession. That is, a brief recovery followed by another downturn.

The reasons are simple. Much of the current growth is fueled by government spending — which will dry up at some point. Unless the power behind the expansion switches to the private sector the economy cannot continue to grow. And that is far from certain.

The U.S. Bureau of Labor Statistics estimates that 8.6 million jobs have been lost since the recession began, and while layoffs are slowing, there’s no sign that hiring is growing at anything close to the levels needed to make up for the loss. About 1.3 million people enter the workforce each year, so that many more jobs need to be created annually — in addition to the ones lost.

History in the Making

We have not seen anything like this before. In past recessions the speed of the recovery equaled or exceeded the speed of the downturn. Based on past experience the economy should have been in overdrive by now, with unemployment in full retreat. Following the dot-com bust in 2001, the number of jobs lost had been made up in about two years. This time we’re seeing a sluggish recovery and no jobs growth.

The last time unemployment hit 10.2% was in 1981. Back then the government’s response was aggressive tax cutting and deregulation. This resulted in employment reaching its previous peak within two years. This time the size of employment decline has been nearly twice as large as in 1981 (5.3% vs. 3%) and the policy response so far has been the opposite — increased taxes and regulation.

We’re in a spiral that’s getting hard to break out from. The simple fact is that much of the growth in jobs has to be driven by consumption, most of which is done by consumers. That cannot happen unless people have money to spend, and when people are not employed they don’t spend much money. Whatever benefits the stimulus packages have had, they cannot be the solution. And all the programs that have been the focus of the administration and Congress for the last year (cap and trade, healthcare) require spending money that must be borrowed and will eventually have to be paid back, i.e., taxes will have to rise, further reducing the money available to consumers for spending.

The Secret of Happiness

The secret of happiness is to lower your expectations to the point where they’re already met. That’s going to have to be the mantra for a long time. With so many unemployed workers employers have every incentive to underpay qualified workers. And with credit scarce and people increasingly focused on reducing their debt, there’s little chance that spending will recover. We may be in for European-style unemployment where 10% is the norm.

Recruiters looking for opportunities should look to service industries – retail, healthcare, government, and education. About half the jobs lost were in manufacturing, construction, and finance, and most are not coming back ever. But healthcare and education are growing. Geographically, opportunities will be the most in the states with the lowest tax burdens and most business-friendly, i.e., least regulated, environments: Texas, Oklahoma, Virginia.

It’s a mad, mad, mad, mad world starts out with the person who had the money driving off a cliff, after which everyone else comes up with wacky ideas to get it. They find the big W but end up without the money and badly hurt. I just hope we don’t see a documentary with the same title.

Two months later, Tiger still is still as skilled, but due to some turmoil in his private life, the number of opportunities available to him has dwindled and less well-known firms that he would never have considered could be his only suitors.

Tiger has a history of “snapping back” from major obstacles, like major knee surgery last year, so there should be little doubt he will return to the game in top form. That said, this is not an article about hiring golfers!

The focus of this article is advanced recruiting and Tiger Woods provides a great example to illustrate a recruiting strategy that you might not be aware of. It is variation of off-cycle recruiting that I call “recruit down, but not out stars.”

A Rare Opportunity to Recruit a Star

Recruiting down but not out stars during a short down period in their life provides a firm with a rare opportunity to hire a top performer when competition is not as intense. At first glance, this might seem like a high risk approach, but the rebound rate of stars is actually quite high. Examples abound: in sports you have Brett Favre, Drew Brees, and Kobe Bryant; in entertainment you have Julia Louis-Dreyfus, Tom Cruise, John Travolta, and David Letterman, and in the corporate world Steve Jobs is a great example. The key with this approach is to determine when a bump in the road is just that and not something more, and to make your move when they are on their way back but before too many notice.

Advantages of Hiring the Down but not Out

Before you reject this strategy out of hand, consider some of the key benefits of pursuing this approach for a percentage of your hires:

• You land a star — you get a recognized star with superior capabilities and a long track record (with only one short interruption) of producing superior results.
• Easy to recruit — because you’re recruiting these individuals when there is little demand for them, it doesn’t take a sophisticated recruiting process or a great hiring manager to capture them.
• Lesser firms have a chance — because the individual’s choices are limited during this brief period of time, they will likely consider work, firms, and industries that they would’ve previously brushed aside. They may even have empathy and therefore consider firms that have also gone through a recent downturn.
• No repeat downturns — you will find that these individuals, because they are smart and they hate failure, will learn from their downturn, and in almost all cases, will never make the same mistake again in their career.
• A loyal employee — although there are no guarantees, it is unlikely that the stars will forget the fact that you helped them when no one else would. They are likely to return the favor by working extremely hard and by staying longer at your firm than you might expect.
• Low cost — although I don’t recommend that you purposely lowball them, it is highly likely that they will work for much less guaranteed compensation than they were previously paid.
• Speed — because they are likely to be currently under or unemployed, they can make a job acceptance decision rapidly and start right away.
• Now’s a great time — because of the down economy, currently, there is literally an abundance of down but not out stars. In addition, many executives are currently unwilling to take risks on these individuals, which means that there is little competition for them.
• Learning opportunity — in addition to their superior on-the-job performance, these individuals are knowledgeable and well-connected. Hiring them will allow your firm and its employees to benefit from their knowledge and connections.
• Visibility — even though these individuals might not be highly respected at the moment, they are still well-known, and as a result, people will take note when they join your organization. When they return to high status, your firm will get additional positive employer brand and product visibility.
• Additional customers — recruiting someone with a great track record and a loyal following will likely also help you land some new customers.

Action Steps to Implementing a “Down but-not-Out” Recruiting Strategy

Define “down but not out”

Start by clearly defining the type of individuals you are targeting. Make sure that the individual has an exceptional record of performance and that whatever bumped them from their perch is most likely only a short bump in the road.

Identify unacceptable transgressions

Clearly spell out what transgressions or errors are unacceptable, such as theft, repeated substance abuse, felonies, etc. Also identify acceptable causes of career downturn, such as business closure, unfair competition, being caught by a manager in the process of looking for another job, or budget freezes that led to talent stagnation. As in Tiger’s case, the cause may be personal problems, i.e. a family breakup as a result of the economic crisis that might have little or no long-term impact on their work.

Conduct a comprehensive assessment

Obviously you need to begin with a detailed professional reference check, but those executing the check should revise evaluation criteria so that “down but not out” stars are not blackballed. I further recommend that during your interviews, you also make sure that they understand what they did wrong, that they regret it, and that they show what steps they are taking to ensure it will never be repeated.

How to “identify” them

Remember that these individuals are stars, so they are well known and well connected in their industry or function. In addition, their individual downturn may also have been publicized, so they are not difficult to identify. The most effective sourcing tools for finding these individuals are employee referrals and social networking. I recommend that you specifically ask your managers and employees to be on the lookout for these types of individuals. Educate your employees to look specifically for individuals who are leaving consulting, have been part of a recent project/product failure, or who worked at firms that have completely shut down.

Additional sources include professional events, “boomeranging” corporate alumni who experienced their own downturn, outplacement firms, and executive recruiters (who over the years may have established a personal relationship with them.) If your firm has already cataloged or inventoried the desirable talent in your industry, use Google alerts and searches to keep track of them.

Initial screening process

Even if you don’t implement a formal process to proactively seek out these down but not out individuals, make sure that your screening process at the very least is capable of identifying them, should they apply at your firm. Work with your resume screeners to ensure that their resumes are not rejected solely because of recent issues.

Onboarding

There is a high probability that these individuals will need some special treatment during onboarding. If they’re currently depressed for example, counseling or coaching might be necessary. Their coworkers might need to be provided with the true story about what happened to them, in order to squelch or prevent rumors. The hiring manager might need to spend more time with them in order to help them understand how your company’s management approach and culture varies from what they’re accustomed to.

Yes, There Are Risks Involved

Let me be clear: all recruiting strategies that focus on top performers will have a high failure rate, so don’t be frightened away because there are risks associated with this approach. Some of the key risks that you need to develop a plan to assess and mitigate include:

• Bad PR — hiring an individual when they’re down may, in the short-term, generate some bad press. It may also cause some of your customers to re-think their relationship with your firm. You will likely also encounter internal criticism from managers and employees.
• Legal issues — you need to make sure that the transgression that led to their downfall will not expose your firm to legal issues.
• Another error — don’t forget to calculate the probability and the related costs if they slide backwards and repeat the same transgression (especially if the cause was substance-abuse).
• Slower assimilation — it may take time for the individual to snap back or to acclimate to a less prestigious firm that moves at a slower speed.
• Resistance — some employees may argue that you should not be rewarding bad behavior. Such employees should be made aware that the risks and the pressures associated with being a top performer cause almost all “stars” to eventually fail at least once. Managers should be reminded that the cause of their turmoil may be personal issues, and as a result, privacy and legal constraints limit their consideration in the hiring decision.

Final Thoughts

This article was published in January 2010. If you’re reading immediately upon publication, you will likely think that it would be crazy to hire Tiger Woods when every other firm is clearly distancing themselves from him, but mark my words, by June Tiger will be bouncing back and everyone will be courting him. His case will most likely mirror that of Kobe Bryant, who rebounded quickly from a similar transgression.

Down but not out stars are not limited to sports and entertainment. They can be found in every industry and within every function. Fortunately during these tough economic times, there are significantly more of them available than during any time in recent memory. If you want to do something bold and strategic in recruiting and you have limited budget and resources, consider recruiting the Tiger Woods of your industry. It’s easy, cheap, and it can have an immediate and measurable strategic impact.

• Sign up for this week’s free webinar on Wednesday at 2:00 p.m. ET titled Workforce Planning: Connecting Business Strategy to Talent Strategy. This session will be led by Ed Newman of The Newman Group. Ed will provide insight into what makes an effective workforce planning strategy and how workforce planning fits into overall talent strategy.
• This Friday is your last chance to register for SourceCon 2010 at the best discounted rate of just $795. If you haven’t yet checked out everything that will be taking place in San Diego from March 14-15 go to www.sourcecon.com/2010. This is a unique & rare opportunity to learn the secrets from some of the worlds best sourcers, and one you won’t want to miss!
• San Diego is also home to the 10th Annual ERE Expo 2010 Spring conference, taking place right after SourceCon from March 15-17. The agenda is brand new and better than ever, so if whether or not you have ever been to one of our previous Expos, don’t expect a repeat performance! Check out the agenda and speaker roster at www.ereexpo.com. And let me know if you would like to come to both SourceCon & ERE Expo, as there are discounts available.
• During breaks at the Expo in San Diego, we’d like to show some of your videos. Make a 1-minute or shorter video of you telling your favorite recruiting story — it could be the most heartwarming advice or experience you’ve had, one that made you proud of the profession — or, it could be bad behavior by a candidate (or a manager!) during an interview, an employer brand gone awry, a botched recruitment ad campaign, or something else. Email Todd Raphael (he prefers PG-13 or cleaner) the Youtube embed code and we’ll pick some of the best to show at the upcoming conference.

If you have any questions about anything I just metioned, please leave them in the comments below. Have a great week!

The financial cost of hiring a walking lawsuit is probably 10-100 times their compensation.

Assuming the duds and the stars represent 10% of your total hires, it’s what you do with the other 90% that really matters.

To get a sense of the enormous financial impact of shifting people from the bottom half into the top half, first categorize the 90% into three big buckets — the Best, the Not Quite Best, and the Least-best. Based on these definitions they should be of equal size:

1. The best, or upper-third. These people represent the foundation of your company or organization. They work hard, frequently exceed expectations, do more than asked, achieve high-quality consistent results, can always be counted upon, need little direction, never make excuses, work extremely well with everyone, and can take over projects even when they have less expertise than normal. As a result they get promoted at a faster rate. If your hiring process is flawed, you won’t have enough of these people to grow your company.
2. The not quite best, or the middle-third. These are the partially competent. Generally they’re strong technically, but missing a key ingredient or two. On the other hand, they get the job done with limited direction, can be counted on in a crisis, work reasonably well with others, and get promoted when there’s no one else around, but they’re generally not the first choice. Sometimes they get hired because they seem safe.
3. The least-best, or the bottom-third. These are the people who just don’t fit somehow. Sometimes they’re good people in the wrong jobs. They need extra coaching and supervision to achieve average results. Often they cause unnecessary conflict. They are often hired because they interview well, are enthusiastic and affable, and have the requisite experience. If this group represents more than a third of your workforce, you have a real problem.

What’s surprising about the middle and bottom groups is that when they were hired they all seemed fully qualified. They all had the right experience, the right academics, and the right skills. Many of them even had the right behaviors and competencies specified on the job description. However, something happened after they were hired that caused a great many of them to underperform. This is typically due to lack of interest in the work, weak relations with the hiring manager, lack of team skills, poor cultural fit, and inconsistent work habits.

The cost of hiring these least-best people is enormous. To gain a rough sense of this first calculate the average profit per new employee (APE) for your company by multiplying your revenue per employee (RPE) by a reasonable estimate of contribution margin. This is probably around 30-40 percent.

So if your RPE is $400,000, your APE at a 30 percent margin is $120,000. This means that on average, each new employee should generate $120,000 in pre-tax profit if as a group they’re doing work similar to your existing employees. Of course, this doesn’t take into account different jobs and different salaries, plus a lot of other missing stuff, but it’s still useful for making a point.

Now assume the top group is 20 percent more impactful than the middle group and the least-best is 20 percent less impactful than the middle group. This means the top group generates $144,000 each in profit (120*1.2) and the least-best group generates $96,000 each. The difference between the top group and the least-best group is therefore $48,000 in pre-tax profit per person per year. This means that for every person you replace in the bottom-third with a top-third person you’ll make an additional $48,000 profit. If you do it 100 times, you’ll earn $4.8 million in additional pre-tax profit. (Here’s a summary graph of this for a number of companies ranging from Goldman Sachs at the high-end to government contractors at the bottom.)

Using this macro-level analysis, it’s pretty easy to justify implementing a top-third hiring strategy. Pulling this off, however, is not that easy, and there are no silver bullets, other than being best-in-class. So if you’re not in this category and if your supply of candidates is far less than your demand, you’ll have to reengineer most of your processes to hire the top-third. Here are some quick ideas on how to get started.

1. Sourcing. The top group doesn’t look for new jobs the same way the bottom group does. Most likely they initially heard about your openings through a referral, recommendation, or by networking with a recruiter or current employee. If this is the case, it makes sense to expand these efforts and minimize efforts on those channels that attract the bottom-third. Before eliminating job boards altogether, however, find out what kind of messaging appeals to the top-thirders. Generally this involves career growth and learning opportunities, challenges, and the chance to make an impact. Write some ads emphasizing these points, use search engine optimization to make sure they’re found, and track the performance of different major and niche boards. Then keep the ones that actually attract the-third. Of course, in the future, make every new sourcing vendor prove they can attract the top-third. The key to all this is to use top-third decision-making and consumer marketing to drive your sourcing channel strategy, not some new vendor of the week.
2. Recruiting. In general the least-best are looking for jobs and those in the top-third are looking for careers. (This is probably the primary reason for variations in on-the-job performance, too.) Looking for a job is much more transactional than looking for a career. Those looking for a career have more informational needs and questions than the bottom-third, yet they’re often overlooked in the rush to start posting boring jobs and arranging interviews. To allow more top-thirders into the process a new and formal information exchange step needs to be inserted before the application process. Good recruiters do this naturally, but formalizing it would increase the number of top people involved by widening the top end of your prospect funnel. At the back end, you can increase the number of top-third hires by providing finalists a score sheet that allows them to formally evaluate your opportunity across a broad range of short and long-term criteria (e.g., growth, learning, impact, team). (Email me if you’d like a sample form.)
3. Assessing. While you can eliminate most mistakes using traditional behavioral interviewing, discerning the differences between the top and bottom thirds takes more investigation. Being fully qualified doesn’t mean being fully motivated, or being able to work in your environment, or working well with the team and hiring manager, or being well-organized, timely, committed, consistent, or flexible. These are the typical causes of underperformance, and ignoring them is a setup for failure. To determine if someone is in the top-third I suggest creating a performance profile to define real job needs, digging deeply into comparable accomplishments using the one-question interview, and using the 10-factor talent scorecard to collect and assess the evidence.

From a practical standpoint it’s unlikely you could ever successfully implement a hiring process to hire only the top 5 to 10 percent. However, hiring the top-third is a reasonable and sustainable target. It would certainly raise the talent bar at an insignificant cost and a huge ROI. It all starts by letting the needs and decision-making criteria of the top third drive your sourcing, recruiting, and interviewing processes. As far as I’m concerned, being in compliance doesn’t mean being ineffective. In most cases, this is just an excuse to maintain the status quo.

Although the program has been underway since October, the meeting later this month is described as an informational session. The invitation that was emailed last week says the intent is to answer questions that have come up.

In an email Q & A, Direct Employers Executive Director Bill Warren says the Jan. 28th meeting will show some of the sites, describe the analytics that are built into the job board platform, and answer questions.

Bill Warren

Warren asked me not to disclose the names of the 29 invitees, but it includes many easily recognizable names of recruitment leaders, as well as several job board CEOs, a few industry writers, and others, including ERE’s CEO David Manaster.

Since industry launches and new product introductions are commonly handled by webinars and previews in advance of launch, I first asked Warren what he’ll be showing and doing at the in-person event.

ERE: What’s the purpose of the meeting? What will you be showing?

Bill Warren: The purpose of the meeting is to answer any and all questions a group of industry experts might have about the .jobs build-out. We are not so vain that we think anyone really cares about what we are doing. However, we have had many phone calls with questions about what we are doing and how we are building out the domains. We will be showing not only how the domains are being built out, but also the analytics platform and how we are integrating with social media. Two long-time, well-respected industry experts suggested that we do this.

ERE: Since your .jobs buildout is well under way and ads have been appearing on the sites for months, why do this now?

Current Boston .jobs job board

Warren: The .jobs build-out is far from being well under way. It was suggested that we invite a group of industry experts to Indianapolis to demonstrate the .jobs platform after we had a working model to show them. We should have a working model with a significant number of domains built out by January 28th. The ads have been on the sites about 30 days. Why do this now? Again, it was suggested that we do it after we had a significant number of domains up and running.

Initial version of Boston .jobs job board.

In a follow-up asking for clarification Warren wrote back, “When I said, ‘The .jobs build-out is far from being well under way’, I meant we had only built-out 200 geo-specific domains thus far. The .jobs platform is still in ‘Beta’ and ads were put on the ‘Beta’ URLs in November for testing purposes.”

ERE: The personal expense to the invitees to attend includes hotel and airfare. What’s the value to them to attend this meeting? Why is it necessary to do this in person?

Warren: Each invitee would of course have to make their own decision as to whether or not their attendance is worthwhile. I’m sure some will not attend because they do not consider it worthwhile and I certainly respect their decision. Because of all the questions we have received, we wanted to offer these individuals the opportunity to see the same presentation, to ask questions, and to hear questions from others. It could have probably been done as a webinar; however, I thought a webinar would be too impersonal for the level of this group.

ERE: What are you expecting in the way of outcomes?

Warren: Nothing more than industry experts having an opportunity to see a demonstration, ask questions, hear questions asked by their peers and, most importantly, get answers to any questions they might have. Again, the meeting is in response to the suggestion of two individuals who have a long-term investment in this industry and for whom I have tremendous respect.

ERE: How will whatever feedback you get affect your rollout and plans?

Warren: We are always interested in being good stewards of the .jobs platform and would carefully consider any and all recommendations we receive. These individuals are experts with a tremendous understanding of, and respect for, our industry. We value their feedback and will try to work with them in any way possible in the future.

ERE: How was the list of invitees decided?

Warren: It was based solely on the recommendations of the two individuals who suggested we have the meeting. If anyone was left off the list that should have been included, I’m sure it was nothing more than an oversight.

The old line, often attributed to Eisenhower, is “The plan is nothing, the plan is everything.” That means that the plan will always fail in the field. But, the planning process is the only way to come close to guaranteeing preparedness. Planning is essential. Believing the plan is folly.

That’s where scenario planning takes its cues. A scenario is never designed as a way to get to a precise prediction. Rather, it’s the only successful method for making the planning process account for the stuff outside the envelope.

The way to use a scenario (or, a set of five) is to suspend belief and assume that what you are reading is an accurate description of the future. From there, you consider your current view and examine it to see if the scenario sheds any new light. This is how Shell Oil, alone amongst its competitors, was able to profitably navigate the oil crisis of the 70s. Since then, the technique is widely used in situations where making future plans is important.

Scenarios are supposed to help you think outside of the box.

Scenarios emerge from a ground of current trends. While the economic situation dominates the public consciousness, a large number of things are undergoing structural change. These trends will drive the evolution of recruiting into the future.

Here are the major trend areas and their key sub components:

Demographics:

Overall — The northern hemisphere is getting older; the southern is getting younger

• Guild cities: Increasingly, people move to cities where other people in the same profession work
• Aging Boomers: Career changes in light of a realistic retirement age of 75
• New work styles: Telecommuting, independent contractor status, portfolio jobs
• Educational choice: Fewer and fewer technologists, more and more liberal arts
• Supervision: Increasingly younger workers are supervising their parents’ peers

Organizational Design:

Overall — The post-industrial organization is emerging; it looks more like a coral reef than a supply chain

• Flattening: Networks obliterate hierarchies
• Synergies: More and more work is hard to describe and multifunctional
• Contract management: The key to intra-organizational communications and vendor management
• Matrix management: More bosses for everyone is becoming the norm
• Culture: Recruiting and mobility programs that favor culture over expertise

Globalization

Overall — Regardless of size, all companies are global

• Work hours and work week: redefined to customer/colleague convenience
• Talent: Finding the right person is no longer a “single origin” question
• Value: Created in the place with lowest cost/highest effectiveness
• Culture: Sensitivity is a technical issue. Naming data properly is critical in cross-cultural workforces
• Economic environment — Some reason to believe that the New Normal means slower growth

Technology

Overall — The flow of technology not only remains overwhelming but increases

• SaaS: Zero external investment and the promise of technology agility make SaaS the tool of the time
• Search: Emergence of recruiting databases that precede the applicant tracking system
• Mobile: Sourcing is a mobile business
• HTML5: Websites fight back; the future is not all social media
• Implementation: Contract administration is a core HR discipline
• Acquisition: Requirements documentation and internal change management are core HR capabilities
• Enterprise: Unwieldy ‘big iron’ systems take heat from more agile SaaS tools
• CRM: Recruiting workflow is about maintaining relationships; plucking the fruit out of the orchard

Social Media

Overall — Twitter nation or twitterbation. The jury is still out

• Blogging: Preceded the rise of the kind of journalism that isn’t so ‘ism’
• Death of publishing: The niche editor is the new power broker
• Social graph: The new background check and referral system
• Collaboration: The promise of a voice for everyone is overextended
• Job boards: Finding their ground. Job boards aggregate opportunity and opportunists in a way that has no peer

Search for Better Returns

Overall — Leaner, meaner businesses pursue effectiveness relentlessly

• Outsourcing: If it’s a process, it will be outsourced. Cost always wins when value is equal
• Definition of employment: 40% of the workforce is independent by 2020
• HR metrics: Emergence of proactive HR metrics that drive organizational performance
• Lean disciplines: Ever-increased focus on bottom line results

Energy and Sustainability

Overall — Energy and sustainability practices will shape the workplace

• Energy choice: Determines where we work
• Energy source: Shapes technology
• Telecommuting: Perfected through globalization
• Foundation: Many trends (above) depend on energy price and availability

The first step in getting this process right involves getting your help to cover all of the important underlying trends. What did I miss? What do you think should be on the list?

Trends are one part of the equation. Next week, I’ll draw a very simple map of the marketplace that allows us to have a conversation about how the future impacts specific areas.

The Five Scenarios project is sponsored research that ends with a presentation, a conversation, and a white paper. PinstripeTalent is our first sponsor.

Out of 2,900 respondents to the survey, only 45 percent reported being satisfied with their job. In 1987, when the question was first asked, 61 percent reported being satisfied.

By now, the numbers may have changed. The survey was conducted last summer when huge monthly job losses were being reported and the unemployment rate was climbing. I should also point out that the survey is not without its challengers and that the results are at odds with other polls, notably the Gallup and University of Chicago, which found workers much more satisfied with their work.

Still, The Conference Board survey shouldn’t be dismissed out of hand. Its other surveys, including the much-watched Consumer Confidence Index, supports the suspicion that many of you have of a general worker malaise. A Salary.com survey released a year ago reported similar, though somewhat less dramatic, results.

In any case The Conference Board survey clearly touched a nerve. Since its release there have been hundreds of blog posts mentioning it. And many more discussing a CareerBuilder survey conducted in November and released on Jan. 7 that says 19 percent of workers will jump ship in 2010.

ERE blogger Rob Jannone talked about this a few days ago in a post he headlined “The Mass Exodus of Talent.”

“Halfway through the 1st month of 2010 and a theme emerging in the blogosphere and social media as it relates to Human Capital Management, is that the mass exodus of talent is imminent,” writes Jannone, who goes on to suggest three steps that might help to improve morale and reduce the potential exodus.

There’s one more bit of data to consider: least satisfied with their job are workers under 25 years of age.

What does this mean to recruiters? Depending on which side of the fence you happen to be on at the moment, it can be a boon helping you attract better talent. If you’re the one losing the workers, it means the internal pressure will go up as the remaining staff, already piled on with the workloads of the previously departed, have to cover, if only for “a while.”

The surveys, and a reading of the blogs and observations by recruiters and HR thought leaders, offers some scenarios for the coming months:

1. High achievers, your best talent, will be the first to leave since they are in demand. Even now they’re doing their networking due diligence, waiting for the right opportunity to come along. That wasn’t so easy in 2009 when 4.2 million jobs disappeared. But in 2010, with every indication pointing to recovery, opportunities will begin to turn up.
2. Young workers, many of whom took any job they could find, will bolt when they can. Some may be excelling in the careers they fell into and may stay because they’ve discovered they like it. The majority — 64 percent — are not happy. In such a large percentage inevitably will be good workers, performing well, who you would like to keep.
3. Older workers who are in the age group typically most satisfied with their jobs, aren’t. They stay because the value of their investments and 401(k)s have fallen so far they can’t afford to retire,; they have fewer options due to age, and are less likely to relocate for work.

The implications of these scenarios, if unchecked and unaddressed, can easily lead to a workforce imbalance with dire consequences. I haven’t seen any of the bloggers predict imminent corporate collapse or anything but a slow, if mass, exodus. However, an incremental workforce change may mask its very effect.

Put those three scenarios together and you get a slow ebb of talent, beginning with the loss of promising young talent first. (Statistically speaking, based on The Conference Board’s demographic breakdown of dissatisfaction.) Simultaneously, top talent will leave. Not all of it, of course. But enough to have a noticeable effect. Finally — and this may be two or three years or more from now — older workers who have recovered financially will retire, taking with them the experience and knowledge that otherwise would have been passed down the line to the up and comers.

How likely is this picture of the workforce future? It is certainly a possibility if you do nothing. And there will be employers who do nothing. They will end up being among those who find themselves having to quickly fill vacancies, if only to keep the phones answered.

For everyone else, take a look at Jannone’s suggestions at the end of his blog post; see how your own workforce compares to the results of The Conference Board survey; and, do some workforce planning with your own scenarios.

Last week, as she was looking forward to her first day on the job today with the international recruitment advertising and acquisition firm, DeVaughn was all excitement and, well, as befits a CEO, enthusiasm.

“My heart is in social media,” she says. “The people at Hodes are incredibly smart about using social media and they are working with some of the biggest and best companies. That’s what’s so exciting about what I’m going to be doing. I can have a bigger, broader impact and work with really great people.”

She actually said a lot more about her new job, but, like trying to sketch the scenery from a bullet train, the best I could do was catch every third or fourth sentence. It was enough, though, to get a sense that DeVaughn preaches what she practices.

She is one determined woman who knows how to set goals and achieve them. Too many people, she told me, “not-work instead of network,” playing Farmville or Mafia Wars on Facebook.

It’s not a strategy, she says, if you don’t have goals that can be measured. Whether it’s candidates that apply, conversions that occur, hires that are made, or relationships established.

When she launched her own short-lived social media consultancy last summer, she wrote that she “stayed up many nights actively net-WORKING in-person, not social NOT-working. My activities were aligned with strategic business goals. Also, I was fortunate to have mentors who gave me honest advice.”

It was that grit and determination — plus, of course, the smarts to make it happen — that lead her to switch from a career in hospitality, to start over learning the ropes in recruiting.

DeVaughn grew up in a large family in Iowa, the daughter of a Korean mother and business owner father. She left after high school to seek her fortune, eventually landing in Phoenix where she worked as an executive assistant to the owner of a small chain of sports-themed restaurants and night clubs.

Along the way, she discovered recruiting and it was love at first sight. Determined to learn the craft and become a career recruiter, DeVaughn moved to Atlanta and a job as a receptionist with a legal, finance, and professional staffing and search firm that promised her the chance to recruit.

“I came here (to Atlanta from Phoenix, where she began her recruiting career) and I didn’t know anyone,” she recalls. “I had to quickly learn and build a network. I did and I’ve learned from every person I met.”

She learned quickly, building a LinkedIn network that now numbers more than 19,000 connections. While she’s proud that her network size has enabled her to source candidates without ever paying a fee, DeVaughn talks about the personal relationships that are at the heart of a core network.

In building her Atlanta network, DeVaughn would attend professional and social HR meetings, especially SHRM-Atlanta, where she is now executive vice president of communication and PR.

“I would do research,” she explains. “I knew who I was going to meet before I went to those events. And I knew something about them.”

By 2006 she had won the Rookie of the Year award, was officially named a Rising Star and moved on to Atlanta’s Talent Connections where she met her mentor, Tom Darrow, the company’s founder. DeVaughn credits him with nurturing her passion for networking and encouraging her entrepreneurial drive, supporting her launch of Social Precision.

A blog and a consulting sideline at first, she made Social Precision a full-time consultancy last summer with her as consultant, trainer, and chief enthusiast officer.

In an email before we spoke, DeVaughn wrote:

“Many people didn’t know if it was the best idea to leave a successful and wonderful recruiting firm where I was still generating commission with stable clients. There were several recruiters and HR professionals in transition. Why would I volunteer to join them?”

Darrow encouraged her to follow her heart. And that lead to a chance meeting with some Bernard Hodes executives who attended a presentation she gave on LinkedIn. One thing lead to another and the offer was made to help lead social media strategy on an international scale.

“How often does this kind of opportunity come along,” DeVaughn says. “I’m just so very grateful to all those people who have helped me so much. I would not be where I am without my network. By network I mean my family, my business family, friends, savvy colleagues, all the people I meet.”

Looking forward to the start of her new job DeVaughn said, “Social media is one small part of a comprehensive recruiting strategy, but it is such an important part that I don’t think you can really say you have a recruiting strategy without it.”

by Dr. John Sullivan and Master Burnett

On January 13, 2010, nearly 800 ere.net community members converged online to participate in a webinar (embedded at the bottom of this article) discussing the trends Dr. Sullivan predicted will impact the talent acquisition profession in 2010. Over the course of that webinar a number of questions were raised, each of which is addressed here.

Q1. Your trends article highlighted what is likely to happen during 2010, but you can you go further and tell us what are the top 10 overall actions steps that you would recommend for corporate recruiting leaders take?

To summarize, we would recommend the following actions in 2010:

1. Plan for a turnaround — assume that a turnaround will begin mid-year, but also look internally for indicators of when your organization is likely to rebound. Next, build an “explode-out-of-the-box” plan so that you are prepared to act quickly when the turnaround begins.
2. Develop an agile plan — assume that there will be simultaneous growth and shrinkage within your organization. Plan for job growth in some departments, but also assume that additional cost reductions in other departments will be needed. Prepare a plan that includes agility and flexibility in all programs.
3. Prepare action step outlines — it’s not necessary to complete a detailed written plan for every possibility, but you should prepare an action outline highlighting the key steps that you would take for the most likely upcoming events. Develop these steps using if-then scenarios (i.e. if this happens, then we will take these actions or steps).
4. Prioritize jobs — because you will be operating with limited resources, focus your recruiting resources on the most important jobs. Start by prioritizing revenue-generating jobs, mission-critical jobs, and jobs in rapid growth business units.
5. Prioritize tools — an increase in the competition for top candidates will require you to shift away from active candidate tools and instead concentrate on the tools designed to attract and land employed top performers (passives). Focus on reinvigorating the employee referral program, recruiting at professional events, boomerangs, and mobile platform recruiting tools.
6. Social media tools — this category of tools require special attention because it is still evolving. The key is to manage the social media initiative and to take advantage of the time of your employees when they are on social network sites. Also, broaden your perspective beyond LinkedIn, Facebook, and Twitter and use other social and internet mechanisms like videos, wikis, talent communities, and online forums.
7. Integrate contingent labor — the most effective strategy for rapidly increasing or decreasing labor capability is the use of contingent labor. Identify the jobs where contingent labor is appropriate; then set a contingent labor percentage target that is equivalent to your projected maximum labor cost-cutting targets.
8. Dollarize recruiting impacts — work with the CFO’s office to build your business case and to dollarize the impact on corporate revenues that can be attributed to delayed or poor hiring.
9. Speed up internal movement — moving internal talent to where they can do the most good often costs less and has a more immediate impact than external hiring. The internal movement process at most organizations must be updated and targeted, so that the needed talent is more rapidly guided into the right jobs. (Improving Internal Movement article.)
10. Retention and blocking — expect your turnover rates to increase by as much as 50%, as the job market opens up. Start by identifying what excites those most likely to leave and then develop a corporate-wide blocking strategy to make it more difficult for recruiters to poach away your top talent.

Q2. What role will contingency recruiting play as we approach a recovery?

Because market volatility is likely to be a characteristic that defines the business environment for months and years to come, organizations must develop a process that guarantees flexible labor costs. If you count all types of labor in use today, contingent labor already exceeds 30% of the workforce in many organizations. The key is to integrate contingent labor management so that labor solutions that look at labor holistically can be presented to managers. Contingent labor should also allow you to rapidly increase labor capabilities that may only be needed during short growth spurts.

Q3. Managing all labor via one function is a topic that has been discussed in my organization for several years, but no action has ever been taken. Can you tell me more about how other organizations have gone about establishing a holistic talent acquisition function that oversees recruiting, contingent vendor management, outsourced vendor management, and consultant engagement?

Understanding the total labor picture is a dictate that has been emerging for several years, particularly in high-tech industries. Organizations like Microsoft, Valero Energy, and Qualcomm come to mind as benchmark firms. Developing a holistic approach generally entails putting all related functions under one leader, developing a methodology to determine in which jobs contingent labor works best, and including contingent labor in broader talent management activities like workforce planning, redeployment, and knowledge development and capture. The key to convincing executives to reorganize is to make the business case demonstrating the increased productivity and labor savings that could result from an integrated process.

Q4. What are some of the best ways to market to passive candidates to increase predisposition to working at your company?

The underlying premise here is that top performers who already have a job are not likely to entertain just any potential job opportunity. “Employed top performers with choices” (passives) have a significantly higher threshold that must be reached before they will consider a company or a new job. The starting point is to identify the job-switch decision factors that would peak their interest. Unfortunately, the attractors used to lure active job seekers (pay, security, and benefits) rarely impress these individuals. Factors more likely to work include working with an industry star or a great manager, exciting job challenges, access to new technologies, exciting learning opportunities, and a chance to lead.

You can identify job switch criteria using three basic approaches:

• ask prospects individually to list their decision factors.
• ask your own top-performing employees in similar jobs to list their job switch factors.
• ask newly hired top performers during onboarding to list the decision factors they used.

The job switch factors identified should then permeate your branding and employment marketing communications and be reinforced during every interaction with potential hires.

Q5. Several industry pundits have predicted that 2010 will be the year that sourcing as a profession dies and becomes a $10/hr job. Do you agree with those pundits, and if not, how do you see the role of the professional sourcer changing/evolving?

No I don’t. There will always be a role for top quality niche sourcers. The role of sourcing will certainly change, so that corporate sourcers evolve into network managers. Instead of doing transactional sourcing, they will use the time of others and focus their time on educating and helping employees and others to more effectively use their social networks. Having thousands of individuals source for you (crowdsourcing) is a powerful and cost-effective tool.

Q6. What do you see as the best use of third party recruiters as this market rebounds?

The ROI of third party recruiters is greatest when organizations need to shift rapidly into entirely new areas or geographic regions where recruiter and employee networks are less likely to be as developed.

Q7. What was the 2009 turnover % and what is the expected 2010 employee turnover? My organization saw no significant change in turnover. Were we an exception?

The current economic downturn has not impacted all sectors in the same way. While some industries were negatively impacted, others grew tremendously. However, numerous studies show that a majority (75%) of employees in nearly all industries are dissatisfied and open to new opportunities. No change in your turnover rate could be an indication of strong employer desirability or lack of alternate opportunities.

Regardless, targeted retention efforts that include employer branding, pre-identification of who is at risk, and redesign of jobs to make them more challenging, rewarding and flexible will be needed throughout the recovery. (Retention Strategy article.)

Q8. Could you detail different blocking strategies?

There are four categories of blocking strategies that prevent external recruiters from poaching your best employees:

• Blocking contact or access — limit access to contact information, train gatekeepers to identify inbound recruiting calls, and block known recruiter phone numbers and e-mail.
• Information gathering approaches — identify who is recruiting and what methods they are using by using poaching incident logs, post-exit interviews, and debriefing during new hire orientation.
• Training and awareness — train employees on what to expect and how to act when a recruiter calls, and continually drive awareness among employees about why your organization’s jobs are superior.
• Metrics and rewards — measure and distribute ranked turnover metrics in order to embarrass managers with high turnover. Institute manager rewards for low turnover among top performers in key jobs.

(Read more on blocking strategies.)

Q9. Haven’t heard of Green Recruiting. What does that refer to?

Green recruiting is the general term for employer branding and marketing efforts that emphasize an organization’s greenness or sustainability initiatives as a key selling tool. Highlighting greenness is important because it is often ranked in the top half of potential candidate’s decision criteria. Among college grads it’s even more important. GE, Google, and Timberland are all benchmark firms in this area. (Green Recruiting article.)

Q10. After two years of budget cuts, three-fifths of my non-labor budget is allocated to technology maintenance contracts and long-term tool/service subscriptions, leaving just 20% of my budget to deal with fluctuations in demand. How are other organizations becoming more agile when budget flexibility is almost non-existent?

In a world that requires flexibility, fixed costs are your enemy. The key is to negotiate flexible contracts based on usage, so the costs go down when your usage goes down. Some outsource vendors offer flexible SLAs, so that your firm can reduce costs rapidly when necessary and increase capabilities rapidly when sudden growth requires it.

Q11. How do you use credit card info for recruiting?

It is not really credit card data that recruiters can use, but rather consumer data that is derived from financial transactions and sold as sales leads by marketing services companies like Acxiom. Consumer profiles often include recruiting relevant fields such as employer, profession, location, annual income, etc. While not appropriate for all recruiting functions, sales lead data can be very useful in high-volume staffing environments. (Years ago such data was dismissed because it was often inaccurate, but today most data providers refresh each field at least once a year.)

Q12. Can you elaborate on the growth of ATS alternatives?

As employee referral programs, dedicated sourcing initiatives, and other forms of talent sourcing that introduce non-applicant talent to the organization grow in popularity, organizations need to build data stores on people who have not completed an online application and are not likely to. The online application is well known as a black hole, so insisting that all people who have engaged via social networking, offline networking, and high-touch referral go to your website and apply is like putting talent in a bus moving at 100 MPH on a freeway overpass that has not yet been completed: i.e., certain death.

For this type of talent, many progressive organizations are embracing CRM solutions and collaboration platforms that enable piecing together of non-applicant profiles over time by a defined group. Possible solutions include:

• CRM Platforms — Recruiting-specific CRM platforms are emerging that let organizations capture small bits of information from scalable web forms that can be embedded almost anywhere, including social network profiles and search-engine-optimized landing pages that bring search engine traffic not likely to explore your online career portal. Additional fields can be captured via follow-up interactions that ultimately help you produce a complete profile. Lead segmenting and integrated activity scheduling can help organizations craft specific interaction plans designed to drive conversion of top talent.
• Collaboration Tools — This category of tools includes robust collaboration servers and smaller web services like wikis and blogs. Organizations that use dedicated but dispersed sourcers including third-party partners can use collaborative documents like wiki entries to build searchable profiles of talent of interest to the organization. Every interaction and research find pertaining to an individual being tracked can be documented and shared in real time across the team.
• Social Bookmarking — Special thanks to Michael Specht for sharing this idea during the webinar Q&A. By defining a tagging methodology, organizations can use social bookmarking software to build robust indexes of talent profiles existing across a multitude of internet sites. Employees engaging in benchmarking efforts could bookmark the profiles of those encountered from other organizations, tagging them with their function, management level, specific skill, etc. With an entire organization contributing to the social bookmark index, a crowdsourced directory of labor could be built relatively quickly and cheaply.

These were the top questions that emerged, but we are sure there are more. If you have a question or thought that hasn’t been explored that is related to 2010 trends, share it in a comment, we’d love to hear what’s on your mind.

Convened by President Obama, the forum is focused on the gap in technology between the private and public sectors.

Craig Newmark, founder and owner of Craigslist, Manpower CEO Jeff Joerres, and Monster chairman and CEO Sal Iannuzzi are sharing their suggestions for improving government efficiency, improving customer service, and maximizing the return from the government’s investment in technology.

In advance of the forum, Iannuzzi joined with three other CEOs of leading technology companies in publicly praising Obama for “consistent efforts to ensure that innovation becomes integral to how our country operates.”

Iannuzzi, Steve Ballmer, CEO of Microsoft, Jeff M. Fettig, chairman and CEO of Whirlpool, and Shantanu Narayen, president and CEO of Adobe Systems, in a commentary posted on Huffington Post, say, “It’s time to modernize government — streamline what works, and eliminate what doesn’t.”

The men echoed President Obama’s own lament that government has fallen woefully behind the private sector in using technology to streamline operations and speed the delivery of public service. In a White House statement, President Obama says, “I want us to ask ourselves every day, how are we using technology to make a real difference in people’s lives.”

In their commentary, the four CEOs say, “As the pace of innovation accelerates, so will the distance between the technological promise of the private sector and the practice of the public sector. Along the way, we risk losing billions of taxpayer dollars, opportunities to serve those at risk and in need, and transparent insight into the operations of our democracy.”

“Indeed, the time is ripe for a real public-private partnership initiative aimed at driving innovation and sustainable job growth.”

We (hiring managers, executives, HR folks, and recruiters) set up expectations and define jobs based on what is traditional. We work from habit and past experience. This is not necessarily bad, but may not match our current needs or the available supply.

Some of us say that we cannot find qualified C# programmers, for example, when we all know that there are very few people with good skills in this area. We are left with choices: hunt like crazy on the Internet and elsewhere to find someone we can influence to leave their current position, wait to find a disgruntled one, or decide to do something different. Something different might be to rethink the job entirely so that it more closely matches someone we already know is available. It might be to increase the supply by developing training programs or taking on apprentices. It might be to merge the job with another one. There are lots of possibilities beyond just doing what we have always done.

Many emerging jobs require a new perspective, rather than an entirely new skill set. An interior designer could easily do the new job of home stager — someone who decorates your house prior to selling it — but for a much lower price. Many skills for jobs in the healthcare arena can be learned quickly, but are all based on a common set of skills around patient care, communication, and appreciation for and understanding of technology. The real challenge is perspective, attitude, and sometimes the willingness to work for less.

Developing People is a Requirement for Success

I spent many years working in the semiconductor industry when it faced a labor shortage of skilled process engineers and equipment operators. We eventually devised training programs that took basic electrical engineers and developed them into capable process engineers quickly. IBM trained thousands of programmers throughout the 1960s and 1970s to meet its own huge needs. At the same time, IBM and other companies quietly worked with academic institutions to develop today’s academic computer curricula.

This training and development does not have to be of the same type that a person would receive at an ordinary academic institution. In most every case, corporate training can concentrate on skills that are needed right now and forego the theoretical, the basics, and the nice-to-have-but-not-critical things. Whether or not a person goes back at some point to get those basics remains a question, but I believe that efficient training can address the labor shortage issue quickly.

In both world wars, the U.S. Armed Forces reverted to intensive training programs to fill critical positions. They have learned that this can be as efficient a process as having a huge standing army.

The trick is in accepting that there is a responsibility on the part of employers to develop the people they need. Employers should be willing to provide the training and development for the jobs they have a need to get done. Waiting for the school system or the government to do your job for you has never been a very good strategy.

We Need to Expand the Labor Pool

Many available people are older or retired and have skills that have become obsolete or are not needed right now. However, these people could be retrained for some of the open positions if we took a different attitude. Unfortunately most of us, or most of our employers anyway, would rather spend money on search fees, agency fees, administrative overhead, and advertising rather than on intensively training people with decent basic skills. Granted, we cannot train people for every job because many of them do require experience, or time in the saddle, as they say, in order to be successful. However, I think we could significantly lessen the labor shortage if we were willing to be a bit wider in our job expectations and definitions.

This is why I constantly argue for integrated staffing and development because I believe their functions are inextricably intertwined. It is very difficult to do one without doing the other. If we are to look at recruiting as a process, we are going to have to incorporate development into our staffing thinking and staffing into our training thinking.

Whether this is done through merging departments or whether it is done simply through good collaboration doesn’t really matter. What is critical is that there is a dialogue between the two functions. If you work in a small company where there are no separate training and recruiting functions, then this becomes even easier for you to do.

You need to always think whether an open position is better trained for or hired for. Is it a job that would be impossible to train someone for in a reasonable period of time, or is it a job that someone could be trained to do fairly quickly?

When management and recruiters both develop a broader understanding of the issues and step up to the fact that in many cases skilled people are just not available at a reasonable cost, then developing people becomes sensible and cost effective.

There are no labor shortages or surpluses — there are just shortages of imagination and an unwillingness to accept responsibility for filling our own needs.