A recent Santa Rosa Press Democrat article suggested that even though July featured a slight uptick in unemployment from June’s 4.3% to 4.6%, Sonoma County is essentially at full employment. According to the article, full employment is somewhere between 4% and 6%.
Obviously this has a powerful impact on the Sonoma County labor market. The effect is even stronger on Marin at 3.7% and Napa at 4.4% unemployment.
We can confirm the change from our office experience. As recently as 2012 there were an abundance of job seekers. This no longer the case. “Employers face a major shift in the dynamics of the labor marketplace and it has been so rapid that many are caught in a mindset that no longer works,” says Joanne Sanders, BOLT’s President.
As welcome as it is, the area’s economic turn-around has come at a dizzying pace. Not long ago the challenge facing employers was sifting through the mountains of resumes resulting from a single ad. These days, not only are the resumes gone, candidates are becoming ever more scarce.
Today, Sanders is seeing employers make mistakes in their hiring practices that suggest they are stuck in an era that no longer exists. “Some employers waste precious time with multiple interviews. While there are certain positions where this is necessary, we are recommending HR people carefully evaluate whether or not it is appropriate for each position.”
Sanders finds some potential employers busy scheduling follow-on interviews while their candidates are talking to other employers. More than once she has seen competing companies hire away talent while the first company continues their interview process in vain.
“It’s natural to use interviews to increase your comfort level with a potential hire. The costs of a bad hire are so high that many employers use them as insurance. When there are plenty of candidates it makes some sense. However, when the available talent supply dries up it’s time to adapt.”
Staffing services like BOLT have a traditional hedge against a bad hire that does not involve the opportunity costs of scheduling follow up interviews for people who’ve already taken another job. By using the temp-to-hire option, employers can put promising candidates to work in their facility rather than leaving them to talk to competing employers.
With a shrinking pool of candidates, temp-to-hire allows employers to see how candidates perform on the job, not just in the interview. “The temp-to-hire is like a contingent offer in a tight real estate market. In either case the buyer is only committed when all the conditions are satisfied,” says Sanders.