Conventional wisdom says that recruiting software might be one of the worst types of technology to be selling to businesses during an economic downturn. After all, you might assume that all recruiting tech leaders are probably looking at more ways to optimize and reduce their tech stack than looking for new tools and technologies.
But like everything else in 2020, it’s time to throw out that conventional wisdom. The unevenness of the effects of the pandemic and economic fallout have left us a world of haves and have-nots.
As you can guess, it’s still not business as usual. In fact, there are two areas where I see some fascinating trends in TA technology.
According to our own internal tracking, the second quarter of 2020 showed a little over $180 million invested in TA technology, down just slightly from the first quarter. That’s remarkable since most of the first quarter of the year was left relatively unaffected by the pandemic while the second quarter took the brunt of it.
What’s more interesting isn’t necessarily the amount of funding, but where it’s going in talent acquisition.
For instance, Berlin-based Zenjob raised $30 million in May to continue connecting organizations to students looking for temporary, flexible work. They are focused on a few locales in Germany and plan to expand nationwide in their home country in the coming months.
In the United States., Atlanta-based startup Steady raised $15 million more in June. Their app helps connect primarily hourly workers with additional or better-paid opportunities based on their skill set, while predicting whether they have a good chance of getting hired.
Yet another company, Workstream, is focusing primarily on deskless workers, who make up a significant majority of the global workforce. They raised their first significant round of funding, $10 million, in May as employers in retail, hospitality, and logistics were retooling their own businesses.
Sure, traditional recruiting-operations software — like ATS and CRM tools or job boards — hasn’t seen significant funding, but that doesn’t mean it’s not there in talent acquisition. You just have to look at non-traditional solutions during a very non-traditional time.
Investors may be looking to make long-term plays in a market that may not see substantial hiring numbers for months or years. For recruiters in the trenches trying to make hires, they are looking for solutions to deal with the realities of today. That means remote interviews and, often, fully remote hiring.
When I asked on Twitter which technologies recruiters are using now that they weren’t using six months ago, the number one answer I got was Zoom video conferencing. Mollie Bentley, a Kentucky-based HR consultant, wrote on Twitter, “I’ve hired 10 people 100% virtually. Had to get used to the video interview to make this happen. Working out way better than I imagined.”
“[B]eing able to use a variety of virtual meeting platforms from Zoom, Teams and Google Meet is crucial in reaching hiring managers and candidates,” wrote Garry Olive, a Los Angeles-based recruiter. Olive also mentioned that he’s intentional about keeping his video on to connect with people.
Christina Ramirez, an Arizona-based recruiter, mentioned virtual events they’ve held for candidates. “We’ve done employer spotlights, virtual campus events, and virtual conference events,” she wrote.
Others mentioned a variety of other solutions, like Microsoft Teams, to facilitate communication among employees and with candidates.
Of course, other people mentioned niche recruiting technologies like AppCast, RepVue, and TapRecruit. But for coping with remote recruiting and hiring, recruiting leaders are turning to the tools that they’ve used to unlock their own workplaces while working remotely.
This trend of using consumer-friendly tools is appealing to candidates who are still trying to limit contact, though. And while candidates are also learning to use new ways to communicate with recruiters and hiring managers, tools like Zoom and Microsoft Teams are still getting positive results for recruiting and hiring managers. Bentley mentioned that they just promoted their first 100% virtual hire.
After the mass adoption of consumer-friendly communication tools in organizations, it’ll be interesting to see where technology in recruiting goes next. Companies in industries less affected by the economic downturn still have significant skills shortages and challenges. Those in industries more affected will need ways to optimize hiring once they start again.
Job boards and ATSs may be more established, but where we’ll likely see growth in the future is at the intersection of hiring managers, recruiters, and candidates making established systems work in a post-pandemic reality.