Another groundbreaking year in HR is coming to a close. Venture Capital (VC) firms are investing more money than ever into new technologies and we are reaching a point of inflection for HR and Recruiting as these technologies flood the market at a rapid pace. Let’s not forget about the tech giants who officially put the legacy HR players on notice. Just a short year ago, Microsoft acquired LinkedIn for $26.2 billion. Facebook announced they were offering Job Search through their Business pages and Google made the biggest splash as they announced Google for Jobs in May. We now have the 3 of the 4 largest technology companies in the world making major moves in the HR space. Even if you remove the 3 big dogs, VC investments have already exceeded a staggering $825 million in 2017 and that’s only through the end of Q3. Throughout this article we will evaluate some of the recent investment trends with an emphasis on how technology is impacting the recruiting landscape.
It’s no secret, HR is a billion dollar business that is ripe for disruption, yet so many challenges remain for companies looking to acquire new talent. Recruiting is one facet of HR that has been remarkably resistant to innovation. The process and workflow within recruiting has hardly changed, despite the significant investments from VCs. Recruiters still need to post jobs, source talent, schedule and conduct interviews, make hiring decisions, and efficiently manage the entire process in a compliant manner. It’s a cumbersome process which is difficult to scale effectively, especially for large enterprise organizations with hundreds of locations, different departments, and varying challenges.
The vast majority of these new technologies are designed to attract high paying and highly skilled salaried workers. However, there are still 80 million hourly workers in the US and few solutions are designed to target the experience of hourly candidates. So, what are the new trends and technologies that can help enterprise companies find hourly talent, and where is all the money going?
2017 HR Investment Trends (Through September 2017):
- Talent Acquisition companies have received the most VC money in 2017 with roughly $475 million in funding.
- Human Capital Management (HCM) made a big jump in funding as companies continue to move to cloud solutions and focus on platforms-as-a-service (PaaS) vs. on-premise or point solutions. VC investments in HCM are north of $235 million.
- Talent Management solutions have received around $125 million as they focus on employee engagement and the employee experience.
Here are some of the areas where money is going within the Talent Acquisition space:
- Job Board Innovation
- Company Branding and Marketing
- Candidate Engagement
- Automated distribution of job postings
- Pre-Hire Assessments and Psychological Testing
- Interviewing Technologies
- End-to-end recruiting management solutions (ATS 3.0)
- Big Data and advanced analytics
It’s a demanding task for talent acquisition leaders to navigate through the sea of new solutions and find technologies that can truly impact their hiring process. First, address your problem and try to fill the gaps that exist in your recruiting process such as; candidate volume, candidate quality, and getting in touch with new candidates. Few solutions exist today that specifically address these gaps, which brings us to one of the important trends highlighted above: Candidate Engagement. Let’s take a look at how improving the Candidate Experience can ease the burden for your recruiting team.
Gap #1 – Getting Candidates through the Door
Employers want new candidates to have a great experience and first impression of their company. However, this isn’t enough to keep candidates coming through the door. Job boards have come a long way and are by far the number one source for finding candidates. That said, it’s a highly saturated market and more often than not, companies are forced to work out of multiple systems and post jobs manually. Additionally, when employers have locations spread throughout the country it’s difficult to know which job boards perform best in each market.
Once a candidate finds a job and clicks “apply” on the job board they are often directed back to the company career page and expected to apply through an Applicant Tracking System (ATS). This is when hourly candidates are asked to create a username and password, provide resumes and cover letters or complete lengthy applications. One fact remains: 95% of hourly job seekers acknowledge that they search for jobs on their phone. Uploading a resume and cover letter from a cell phone is nearly impossible and the vast majority of hourly workers don’t use LinkedIn or have a resume on social media. Additionally, if the candidate makes it past the resume section they will most likely be asked to fill out a lengthy application that’s not optimized for mobile.
What does this lead to? Application abandonment. On average, ATS applications have a 90% application abandonment rate in the hourly space. This leads to inefficient spend on the job boards and a poor application experience for your candidates. More importantly, you are potentially missing out on great candidates.
So, what do you do? Incorporating a Candidate Engagement Platform, such as Jobalign, is a great solution to drastically change application abandonment ratios. By simply giving candidates a great application experience through features like mobile apply, text-to-apply, Facebook apply, and bilingual apply, you can see tremendous improvement in candidate volume. Let the candidate apply on their terms, in ways they’re comfortable. On average, customers see around an 80% application completion rate, which is a complete flip on the spectrum of engagement.
Gap #2 – Keeping Candidates Engaged and Reducing Candidate No Shows
Getting candidates to apply is not enough. You have to keep them engaged with your company and interested after they apply. The reality is, when an hourly candidate starts a job search, they are typically applying to many different jobs. Generally, the first company to reach the candidate has the best opportunity to make the hire. Communication after a candidate applies is an extremely important contributor to your hiring success and it could be costing you considerably if not managed efficiently.
So, what do you do? Reach out immediately, at the very least within the first 24 hours. Send automated messages thanking the candidate and set proper expectations for next steps. From an hourly candidate’s perspective, nothing is more frustrating than applying for a job and not getting a response back from the company. Don’t just call or email a candidate one time and expect a call back. Keep in mind candidates may need to be contacted after normal business hours as they may have existing employment obligations.
Jobalign allows its customers to send out custom messages via text or email to candidates. Jobalign is also developing new functionality which allows recruiters to engage in a text conversation between the candidate’s mobile phone and the recruiter’s browser chat window inside their ATS. It’s a great communication tool for recruiters so that they don’t have to send text messages from a personal device and most importantly, they can communicate with candidates that prefer to text.
Every large organization has its own unique set of challenges and business objectives. Managing the demand for new talent will continue to be a challenge for many of them, especially for those that hire hundreds or thousands of hourly workers per year. Which is why we can expect Candidate Engagement to be a major technology trend in 2018. If you are able to address the recruiting gaps highlighted above, your talent acquisition teams will be able to manage turnover more efficiently and fill open roles faster. Using a Candidate Engagement Platform, you can begin to transform the recruiting workflow that has been so resistant to change.