How To Hire The Right Team During A Market Downturn
Learn how to attract and retain top talent with these seven strategies.
Hiring and retaining quality teams is one of a company's most pressing issues today. According to a study tracking 17,000 workers, Millennials are the largest group facing layoffs due to the market downturn, while Gen Z leads the movement in the Great Resignation. For companies that retain their staff, employee engagement remains a longstanding issue that demands a solution, with only 34% of employees feeling engaged at work.
As the CEO of a recruiting service, I've seen firsthand how various factors determine whether or not companies achieve sustainable growth backed by the right human capital. During the pandemic, my company faced those issues head-on and was able to triple our revenue, retain an engaged staff and hire more divisions by addressing these key components that ensure you hire and maintain the right team and culture.
Here are the seven areas you must prioritize to scale with the right team.
During times of upheaval, your team may feel nervous. To maintain employee engagement, involve your team in your decisions and let them know what to expect. During the Covid lockdown, my partner and I told the team exactly what we were thinking and what was to come. We were very honest about not knowing what to expect as neither none of us had ever dealt with a pandemic like Covid,
We told them, "You are in good hands. We are not panicking. We will not only survive this, but we will thrive, and we have a specific plan for how to do that". This put our team at ease as they knew they were in good hands.
2. Proactive engagement
During a volatile market, many companies may feel tempted to take on any business, quality or not. But in recruiting, especially in contingent search, it's never the volume of positions but more about the commitment and quality of search assignments. Hence why we had very honest meetings with our clients to see if they really needed us or not. For those who weren't sure, we moved on and gave them space; our business dwindled by 80%. In doing so, we had the team only focus on the clients we did have and provided them with the white glove service they needed.
3. Increase goodwill
During uncertain times, increase goodwill and trust amongst your clientele and staff. For example, don't lay off staff, stop paying vendors, defer rent payments and reduce benefits. Instead, maintain integrity, pay your staff salaries and bonuses on time, and pay your partners, vendors, and rent.
At my company, certain people even received promotions and raises, keeping morale and trust high and turnover nearly zero. Doing this meant my co-founder and I had to go without salaries for four months. As Simon Sinek says, "Great leaders…understand that the true cost of the leadership privilege comes at the expense of self-interest."
4. Adaptive risks
Studies show that 55% of workers in America are planning on looking for new jobs. Attract top talent by offering the right qualities employees are looking for and draw them into your company or encourage them to stick around.
In response to the market uncertainty of the pandemic, we moved into the offensive. After four months of hunkering down, we decided to hire an entirely new group of recruiters and account managers and have them become market masters in specific technologies. We tripled our revenue in one year by planning to serve the upcoming pent-up demand and focusing on the long-term vision of growth trajectory for the coming years.
5. Hire right
Too many companies use the "post and pray" method to hire, which leads to misalignment. The price of a bad hire is at least 30% of the employee's first-year earnings. Beyond the monetary costs, a bad hire can lead to culture disruptions, lost customers, process inefficiencies and possibly the resignation of great employees you don't want to lose.
To set our teams up for success, we streamlined our interview and onboarding process to make hiring more consistent and aligned with our vision, mission and values. We also hired groups of three new staff members at a time to get more economics of scale with training time.
6. Culture is key
According to the U.S. Bureau of Labor Statistics, over 47 million Americans have quit their jobs, marking a huge departure from the workforce. Positive team culture is easy to foster when the economy is booming and companies are growing, but how do you keep it up during tough times, so your team stays committed?
Even during the market downturn, my company continued to invest in having fun. We went wine tasting and go-karting. We stopped off at a local casino and relaxed together on picnics. We had weekly happy hours and catered lunches and game nights. We smiled, took care of each other and stayed positive. This built trust across the team and helped us stay resilient. By focusing on culture fit, you can keep your teams engaged and connected to each other and your company. We were able to weather the storm, stay together and scale during the boom in 2021 and 2022.
7. Retain and sustain
Many companies, a recent example being Coinbase, hire at a pace that outdistances their company needs and then lets them go when they no longer need them. Instead, think long-term before getting rid of good people just because they're struggling or you don't need them right now. Keep one year's worth of operating expenses so that you too can weather storms and not make short-term decisions based only on current needs.
Focus on the human element and see your employees as people, not as assets you can buy, sell and trade. This builds loyalty and trust on both sides. If you have good people, you need to do everything you can to keep them. It will pay off for everyone in the long run.
In today's economic climate, companies must focus on meeting the needs of their staff, attracting top-quality human capital, and retaining them through market downturns. Doing this will ensure the company remains healthy and grows sustainably yearly.
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