Over 1,000 tech companies cut upward of 260,000 jobs in 2023 alone. Thousands of layoffs in the past few years have meant companies faced uphill battles with public and candidate perception. This is especially true for the layoffs that were handled poorly.
Employees today want companies that bring more than just job satisfaction through pay. Candidates seek value-driven companies that affirm their values. According to Gartner, 82% of employees surveyed say it’s important for their company to view them as a person – not just a worker. However, only 45% of employees believe their organization actually sees them as such.
Especially during layoffs, companies need to uphold their values and be empathetic to what employees are experiencing. Data shows that transparency during layoffs builds trust. A PwC survey found that 58% of employees say encouraging managers to increase communications with remaining team members fosters trust during reorganization.
Related: Why You Should be Recruiting Laid Off Talent (+ 3 Key Strategies)
The key to creating trust and building a positive image of the company is employer branding. According to a recent Hired survey, 41% of employers plan on increasing employer branding in their 2024 hiring strategy.
Employer branding helps talent pros attract and retain top. A positive and well-defined employer brand enhances reputation, boosts employee engagement, and leads to higher productivity and lower turnover rates. Strong employer branding becomes more important than ever when companies implement layoffs.
Hired predicts TA will feel the heat as companies that handled layoffs poorly struggle with recruiting and feel tension with managers over the cost of vacancy.
“Companies that were quick to downsize are beginning to realize the negative ramifications, as evidenced by recent headlines about hiring boomerangs. Organizations that laid off staff empathetically, offered severance packages, and helped workers land on their feet will have an easier time hiring and winning back talent, compared to those that face reputational issues.” Samantha Friedman, Hired SVP People Strategy.
Biggest change to hiring strategies for 2024? Surveyed employers say it’s a greater emphasis on employer branding. When asked if their company’s growth has been hurt more by layoffs than the economy, 41% of employers said yes, while respondents at medium-sized companies (300-9999 employees) were most likely to agree.
If their company experienced layoffs and made headlines in the news or chatter on social media for poor execution, companies will need to repair the damage through employer branding. If response rates or acceptance rates were low before, imagine what they’re like after negative publicity from a poorly executed reduction in force.
Efforts to repair reputations and employer brands will be especially valuable to technical sourcers, recruiters, and TA teams, who are on the front lines and often the first point of contact with a candidate.
Hired’s CEO on companies mishandling layoffs
In a recent Talk Talent to Me episode, Hired CEO Josh Brenner discussed layoffs and how companies choosing to handle them would affect their success in rehiring.
A Hired survey revealed 68% of tech employers would feel confident rehiring employees they laid off. However, only 15% of unemployed workers would definitely accept a job from an employer who laid them off.
Reflecting on these stats, Josh explained, “One of the key pieces of that connection talent has to companies when looking at the values is trust. They want to feel like they can trust their employer… The companies that handled those layoffs poorly will have a very small chance of getting any of those employees back. They have their challenge cut out for them. Not only are they not going to be able to get the boomerang employees back, but they really need to focus on their recruiting efforts.
Those companies now have employer branding issues. People talk, use social media, and check company review sites like Glassdoor and Blind. Talent teams now have a hard job within those companies to rebuild trust with jobseekers.”
What can companies do to address that? Josh suggests they be transparent in the recruiting process. They should share why things happened the way they did, what they learned, and how they will adhere to their values going forward.
Related: Transparency is one of Hired’s vision values, so each year Hired recognizes companies who demonstrate it (and equity and efficiency) in their hiring processes and activity. Check out the 2023 List of Top Employers Winning Tech Talent.
How companies are strengthening employer branding
Whether companies are rehiring post-reorganization or looking to build general brand awareness, investing in employer branding is a strategic move. Bark, Chase, and Wayfair turned to Hired as a solution to strengthen their brands in tech and increase awareness among highly qualified software engineering talent.
Bark wanted greater brand recognition among experienced Front-end, Back-end, and Full Stack Engineers. Hired Events hosted a virtual candidate event (VCE) for Bark featuring their CEO, Tech Leadership, and Talent team sharing how they navigated through adverse times and exceeded business goals.
Offering the opportunity to directly connect with the tech team and showcase the company’s ability to adapt and excel through diversity boosted Bark’s appeal to engineers. Nearly 90% of attendees opted in to learn more about life at Bark!
See how Hired helped Chase and Wayfair through similar Virtual Candidate Events hosted by Hired.
The cost of vacancy as a key concern
As companies struggle with rehiring after layoffs, we found that 63% of employers say the cost of vacancy (CoV) is a key cause of concern.
Our survey also revealed that 70% of mid-market or scale-ups (vs 61% SMBs, 58% ENTs) expressed this concern. Data also showed that 76% of hiring managers have this concern as CoV affects their teams and project deadlines the most. This is compared to 63% of executives and 49% of TA/recruiters.
What is the cost of vacancy?
The cost of vacancy is a figure expressing the dollars lost due to leaving a job position unfilled. The costs may be hidden in inefficiency, training hours, knowledge loss, and further attrition from team members taking on more work. Especially concerning is the lost opportunity for research and development along with potentially hindering the ability to capture growth or market share.
Related: Less Competition, More Talent: Here’s How to Recruit in an Economic Downturn
In the longer-term view, an open position may lead to:
- loss of productivity and revenue,
- the slowdown of goals and projects’ roadmaps,
- the negative impact on deadlines and employee morale,
- retention issues, and
- even a loss of market share.
The ripple effect of vacancies is damaging to business. Here’s what organizations can do to calculate the costs of vacancy reboot hiring.
Related: Restart Recruitment Guide: How To Reboot Tech Hiring Post-Freeze
Source: Employer - hired.com
