Well 2022 has been quite a ride! We’ve been watching the pendulum swing from feast to famine and back again as far as the hiring front goes. Economic forecasts are all over the map as well, from the ultra optimistic to the ultra pessimistic. Is it a recession? Are we poised for growth? And how does the Seattle/PNW market differ, (or does it?) from the national landscape.
To make sense of this, we turned to Shannon Anderson of Madrona Venture Group, one of our most trusted colleagues in the area. She has a first-hand view of what hiring looks like for many of Madrona’s portfolio companies, and has advised countless human resources executives. She is an excellent source of knowledge on what to expect in hiring in the next few months.
While people can debate on what to call it, clearly we’re all experiencing some economic woes on a global basis.. “There’s lots of discomfort with the idea of what happens in a recession. For many, this is their first economic downturn or recess,” says Anderson. “This is my seventh.”
She notes that it is key to be flexible and be able to pivot to address new circumstances, as companies and individuals did as a response to COVID. Employers have to react to current inflation, social unrest and other factors when making hiring decisions.
“Right now things that are not critical to maintaining and growing the company are getting deprioritized. Managing costs and moving high performing resources to highest impact projects,” she says. Inflation impacts hiring because people are feeling a loss of income. And with the stock market downturn, stock as compensation is worth far less. Yet companies must remain competitive and make sure they are acquiring and retaining really great people. But now, things that were strengths two years ago are not necessarily strengths now. New times call for new skills.
However, growth must continue for top companies, but not growth at all costs. Companies who raised millions of dollars and had billion dollar valuations now will need to grow into their valuations. Prior to this downturn, companies got really good at a certain kind of recruiting. There was a volume solution, throwing money at problems and more people at business challenges. “Now we need to get really good at being efficient with the talent we have,” says Anderson. Retention is more important than ever. But now, “We need people who can grow durable companies,” she says.
But besides focusing on retention, it is a great time to pick up phenomenal talent. Some of the largest local employers are implementing layoffs which creats an unprecedented opportunity for the employers who hadn’t been able to compete with those big players.
As times change, so do opportunities. As some businesses fade due to the new economic circumstances, new ones arise that match the needs of the times. Anderson and her team are always on the lookout for rising companies that are adaptable, relentless and creative. No matter what the economic times, there is always a need for companies that deeply understand customer pain points and human problems that need solving.
So what is Andersen’s advice to HR execs? “People are worn out. We have to make sure we keep our best people feeling safe, appreciated, paid well and we’re being fully transparent about what needs to be done.” She believes creating ownership and commitment to developing talent will lead to retention. It’s time to double down on taking care of the top performers, and investing in relationships. But recruiting and hiring can’t stop. Top talent are not getting deluged with inquiries from recruiters right now, so it’s a great time to stand out by reaching out. “There is no better time than now to get to know talent. Always be recruiting, even if you’re not hiring right now,” says Anderson. Because when your company does need to fill crucial roles, those top performers will remember.
TalentReach is looking ahead to 2023 and will be ready for whatever challenges our clients have. We’re grateful to have Shannon as a trusted resource!
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