A reader asks what will be different in the job market in the June 30, 2020 Ask The Headhunter Newsletter.

Question

The coronavirus pandemic is a game-changer for the job market. What changes do you see coming in the new normal? Any tips on how to be one of those who can get a job again as things open back up?

Nick’s Reply

post-pandemic job market

This could be a long discussion! I’ll try to stick to a few points that I think I’ll be able to defend when the discussion starts in the comments section below. I can’t offer much evidence yet, but my gut tells me employers will be more selective when hiring going forward, so you will have to adjust your job-search methods accordingly.

Why?

Selective hiring in post-pandemic job market

Over 40 million people have lost their jobs and filed for unemployment since the pandemic began. That’s a lot of jobs. I don’t think it’s hard to predict that when employers start hiring again they will re-fill only a portion of them.

It seems Federal Reserve chairman Jerome Powell agrees. He recently told a gathering of bankers there will be “well into the millions of people who don’t get to go back to their old job. In fact, there may not be a job in that industry for them for some time.”

Employers will have to be more selective simply because they won’t be able to hire as many workers. The reason is elementary: In the post-pandemic job market, companies will have to save money, many of them without choice.

Managers will do their own recruiting

Wharton labor researcher Peter Cappelli has pointed out that modern corporate accounting systems treat vacant jobs as a reduction in costs, and thus as an increase in profits. My good buddy Jeff Pierce, an executive in the IT services industry, calls this “junk profitability.” I think he’s right.

UPDATE: The Economic Policy Institute reported on June 29, 2020 that Nearly 11% of the workforce is out of work with zero chance of getting called back to a prior job.

“Of the 164.8 million workers who are either in the labor force or who have dropped out of the labor force as a result of the virus, 11.9 million workers, or 7.2%, are out of work with no hope of being called back to a prior job; 5.7 million workers, or 3.5%, expect to get called back to work but likely will not; and 14.8 million workers, or 9.0%, may reasonably expect to be called back. In other words, even if all workers who can reasonably expect to be called back to their prior jobs were called back, the share of the workforce out of work would still be 10.7% (7.2% plus 3.5%), higher than the highest unemployment rate of the Great Recession.”

As businesses try to recover, I believe they will spend less on staffing. But managers will likely face the same, if not higher, productivity expectations. Managers will have to operate on lower staffing levels, and this will force them to step up to the challenge by hiring more carefully.

I think the best managers will handle more recruiting on their own because they know HR has no skin in the game. Fed up with HR organizations that have always shoveled the wrong candidates into interviews, managers will rebel. They will take hiring into their own hands because not to do so could risk their own jobs.

Job seekers who’ve got game will prosper

Employers will invest their salary budgets prudently and selectively. I believe managers will be much more receptive to job candidates who walk into an interview and demonstrate, hands down, how they will do the work and do it profitably.

In a recent article, Job Search During The Pandemic, Jason Alba suggested that job seekers need to be on their best game: “The pandemic makes it necessary to do more of what we know works best.”

This means:

Job ROI will matter

The University of Chicago’s Becker Friedman Institute projects that up to 42% of the pandemic-related layoffs in the U.S. will be permanent. If you are a victim of these cuts, how will you position yourself for a new job?

If managers have less money to spend, they will monitor hiring ROI (return on investment) much more closely. Every hire will matter more. This means what you can offer employers in the post-pandemic job market will matter more.

I think this will be a smart employee’s market where the best workers will pursue jobs where they show how they’ll make a difference — and thus be able to negotiate good compensation packages. Job seekers who keep dialing for dollars by playing the numbers game with job applications will lose.

We’ll see if I’m right. Now let’s hear everyone’s comments.

What are your predictions for the post-pandemic job market? How will the massive, pandemic-related job cuts affect your ability to get — or to fill — a job? Will those jobs ever come back? What will make you worth hiring in the new economy and job market?

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39 Comments
  1. Nick, your comment about managers having to take charge more directly of recruitment/interviewing/etc. strikes me as 100% correct – I can already see this in my organization, where HR’s headcount is being trimmed, but we certainly continue to post new positions and fill them.

    COVID also seems like it is also going to accelerate some other trends that we saw build momentum prior to the pandemic – like automation, including around HR. For example, my organization is going to start to experiment with a system called “Hello Ezra” as a way to provide internal business coaching to senior leaders.

    If the automation trend starts to focus more on internal HR processes…well, if it simplifies some things, or supports better decision-making, it might be for the good. (I am trying to be open minded here.)

    That’s completely separate from further automating parts of the recruitment process. I think we can all agree that many aspects of the automation of recruitment need to be rethought and reworked, and maybe unwound.

    (PS – I won’t post the website for this automated coaching service, as I don’t want to seem like a shill! Those who want to learn more can look it up.)

    • @Neil H: I agree that HR automation will be a part of what we’ll see post-pandemic. But it’s important to distinguish between automating processes from automating decision making. HR has already gone too far in pretending that A.I. can be applied to making decisions (e.g., selecting job candidates for interviews). Even A.I. researchers warn that this is a bogus application of their work. (Check the News section for articles.)

      • Didn’t Amazon scrap their AI that they were using to help them hire?

        Something about tech being male dominated, so the AI automatically “thought” that it had to look for all males.

  2. I was laid off in 2001 for 27 months. During that 27 months, I diligently looked for a job. I joined a few networking groups, and after awhile, I realized I wasn’t out of a job because of me because there were so many people out and looking as I was. That was an enheartening insight.

    When I found a job it was through the friends I had made in the networking group. We had set up a volunteer project to learn the latest skills and we ran the project using our professional skills.

    It took 27 months because it took 27 montHs to absorb so many people back to the market. A lot of people changed careers or started their own business.

    Because so many people are unemployment now, I have a feeling that it might take you more than 3 years to find another job. If so manage your finances, starting today, very frugally.

    • There’s industry (type) dependency as well.

    • @Lucille: When people ask me when they should start looking for a new job, my answer has always been, “Two years ago!” I may have to adjust that now.

  3. The disruptions in various industries (e.g., food service, entertainment, travel) will provide openings for new ways of doing things. Particularly, new ways that do not depend on serving large numbers of customers crowded together. Combined with the number of people laid off from those same industries, there may be a lot of new small businesses (some very small).

    Some existing slow trends have sped up remarkably, for example, demise of brick-and-mortar retail chains, and shift to remote work and training using video, etc.

    There may be more demand for hands-on skills that provide obvious customer value than for administrative skills.

  4. On June 29, 2020, Nike made a public announcement they are restructuring their entire organizational system. Certain models of shoes are in the process of being eliminated. ALL POSITIONS are being reviewed for continuance or elimination. This despite the fact that Nike has $12.5 billion dollars in the bank. Takeaways from this include: #1. Successful large companies are determining how they want to operate in the short-term future. #2. Many positions are being eliminated due to lax over-hiring. #3. A very profitable bottom line is not swaying the new mindset of restructuring a successful business. Part two of this point is elimination of the cliche, “If it ain’t broke, don’t fix it.” #4. Other companies, big down to small, will look to Nike and others similar to Nike as guideposts for their own restructuring.
    The changes to the various business components are do doubt influenced by the COVID-19 pandemic. Some of these changes will have longer lasting impact than others. For the American worker the focus should be on re-evaluating their job skills (not talents). Obtain training in those areas where change is truly a trend and not merely a temporary fad. This may mean obtaining training for an entirely new type of work. Once this self-assessment is completed, the big aspect of getting hired is for the prospective employee to learn how to effectively sell themselves to the potential employer.
    In my capacity of consulting to various businesses, mainly small to medium sized, these clients lament how little an applicant actually sells themselves for the position. These applicants rely on resumes, referrals from networking or friends but don’t really do the job of convincing the employer they are the right fit for the position.
    It’s now common knowledge companies are and will continue to look for those individuals who have the job skills and the critical thinking capability to not only assist in performing necessary tasks but helping the company stay ahead of market conditions, competition, and innovation.
    My company has devised a program, not computer related, for hiring managers on what to look for from applicants. This is a series of questions during a personal interview process that is effective in weeding the chafe from the wheat. Thus far my clients are quite pleased with the process. I won’t divulge it here but will give you this. At the beginning of the personal interview, the hiring manager gets to within one foot of the applicant’s face and calmly asks the question, “Sell me on yourself and why I should hire you.” Thus far the decision is reached within three minutes, sometimes less. Those applicants who avoid eye contact, stammer, and attempt to process what resume features to say are automatically eliminated. Another aspect my clients are utilizing as part of this hiring process is, “can this individual effectively operate as an independent hire?” Not everyone can, but I guarantee that as time goes on, more companies will utilize this option in hiring. The main reason many haven’t is because they haven’t determined what positions to eliminate, how to classify job responsibilities or fully grasped the benefits of going the 1099 route.
    The competition factor in getting hired is and will continue to be intense. If you don’t have critical thinking ability and can truly sell yourself, you just bought a ticket on the Titanic. Enjoy the ride.

    • nice long-winded advertisement for your business.

      • It doesn’t seem to be an advertisement for his business. He didn’t even give the name of the business.

        I do wonder about the bit about the hiring manager getting within one foot of the applicant’s face. I don’t think that this is the time to try tricks like that. Many folks nowadays are sensitive regarding their personal space with all the physical distancing guideline in place. Also some folks/cultures have a larger personal bubble/space and will instinctively step back if someone unexpectedly jumps into their personal space like that. It strikes me as almost a bullying tactic, taking advantage of the fact that job applicants have been plunged into a decidedly employer’s market.

        • @Borne: You beat me to it. An interviewer getting in a candidate’s face is not just inappropriate, unacceptable and bad advice. It’s stupid because any candidate with sense and integrity would get up and walk out.

          • Nick, unfortunately nowadays with the extremely high number of people unemployed, even candidates with sense and integrity might very well be desperate for a job, perhaps even just any job.

            Certain employers know this and know that they have most job applicants by the short and curlies.

            In the Western world, North America seems to be renowned for providing little protection for employees, for example ‘at will’ employment, meaning employers can even fire someone on a whim. They don’t need to have just cause which is the case in most of the Western world.

            North American employers offer zero job security, yet some behave almost as if they own their employers, even thinking they can demand their livers: https://www.askamanager.org/2016/04/our-boss-will-fire-us-if-we-dont-sign-up-to-be-a-liver-donor-for-his-brother.html

            Another employer fired an employee even after she donated her kidney, for her boss:
            https://www.youtube.com/watch?v=t-KDT5cbzoc

            “Stevens said she did not realize that she was in for serious pain, discomfort in her legs and digestive problems after the surgery on Aug. 10, 2011. She said she felt pressured to return to work Sept. 6, before she was ready — even while her boss was still recovering at home. When Stevens went home sick three days after her return, she said, Brucia actually called her from home to berate her.
            “She . . . said, ‘What are you doing? Why aren’t you at work?’ I told her I didn’t feel good,’’ Stevens told The Post. “She said, ‘You can’t come and go as you please. People are going to think you’re getting special treatment.’ ”
            The boss gave the woman who saved her life less time off to recover than she got… Just incredible. You read the headline and you think you know what a monster she is, but no, there’s more.
            After Brucia returned to work, she’d yell at Stevens in front of co-workers over alleged mistakes, Stevens said.
            Stevens said her office and overtime were eventually taken away and that she was demoted to a dealership 50 miles from her home in a high-crime neighborhood that co-workers jokingly called “Siberia.’’ Experiencing mental anguish, she consulted a psychiatrist, and her lawyers wrote a letter to the company — after which Stevens was quickly fired.”

            • Perhaps some jobs/companies aren’t worth the effort to research or get good at.

              I suspect there will be more of those as employers see and presume on the glut of unemployed people, but that’s a position that may well backfire as people develop other ways to make a living.

  5. It disturbs me greatly to see others pretending that it was a virus that stopped them from working and that the powers-that-be won’t or can’t ever arbitarily force everyone out of work (again). Uh huh. I guess it’s in our nature to readily believe the most outlandish advertisement (“Free beer at (place address here)”) than to accept the most depressing truth (“You have cancer.”). What happened with the states forcing others into unemployment and bankruptcy for their “protection” was monstrous and akin to what we normally see in 3rd-world communist countries, but here we are…blaming it on a bug (which will conveniently disappear after the election).

    Practical advice and predictions for the job hunter:
    -Keep your guard up. Don’t expect contracts to be enforced when mobs on the street are permitted to burn and pillage. Expect far more ponzi-schemes, bait-and-switches, etc, to come out of the woodwork.
    -Legal job market becoming increasingly political and (last I checked) it’s perfectly legal to discriminate against those who vote a certain way. Avoid companies that play this game if seeking a long-term committment.
    -Places where civil-liberties and rule-of-law are better respected will likely recover the fastest. Places where both are poor will likely be decimated for years to come as both investors and skilled workers migrate out for the former. Be prepared to move or stick it out if you’re in the latter.
    -Consider becoming a jack-of-all trades. Reasons should be obvious.
    -Network with your NEIGHBORS. It amazes me to no end why people network with coworkers, yet never with those who live right next door. Truly mindboggling. Skills, experience, trading, job opportunities abound when you simply say “Hello”.
    -STAY POSITIVE. Facing hard truths not only creates real progress, but overcoming them also creates pride that you normally can’t get when things are easy (For inspiration, watch the movie The Legend of Baggard Vance).

    • At DW: You sir are delusional! Your perspective is that of someone with a very slanted political mindset. Your so-called advice is impractical, sophomoric and not in line with what currently is going on in the world. My suggestion is that you take a course in civics and learn how your government works. Now that you’ve vented your nonsense, get real.

      • Mr. “Sanity”????
        More like Mr. Venom Spitter.

        Some posters have received a personal email from Nick addressing alleged negativity less severe than your steaming hot and bothered post.

        So, do tell us, what exactly did your diatribe contribute to the topic at hand?

    • Your post is filled with wisdom. Here are just two reality checks for those that ignore what you posted.

      Reality Check #1: A certain large (~50% +) segment of society lets their feelings decide what the “facts” are. “Facing hard truths…” is difficult, so many default to the knee-jerk (easy, emotional) reaction path – which doesn’t end well (cue the looting and riots).

      Reality Check #2: Many will be offended by what you say. They’ll keep looking for big government handouts and blaming everything and everyone else for their own self-perpetuating entitlement attitude.

      “Consider becoming a jack-of-all trades.” Good one. Although some may argue that this eventually makes one “unemployable” by spreading talent too thin, today’s reality should make it clear that those with v-a-r-i-e-d talents in their career tool box will be better off. Unfortunately, those that drilled their well of talent too deep (silo, vertical) will have more to lose when that niche career/field dries up due to the shutdown and beyond.

  6. trying to predict ahead on this is the sound of one hand clapping. I think the reaction to this virus thingee will accelerate some directions that were evolving as connectivity & related technology tightened, e.g. working remotely, educating remotely.

    One point I remain skeptical about…managers doing more of their own recruiting. Good ones always did their own recruiting.. for the others ..recruiting will hot hit their high priority.

    I expect business will pick up, or new businesses emerge. But executive management especially the bean counters will have become addicted to lower costs..and labor is a big chunk of that..and will resist rehiring in general…and finding or believing they’ve found they can do without certain jobs.

    So the 1st obstacle managers will have is inability to hire..no permission, no reqs. So recruiting won’t overtly enter the picture.

    Managers & their teams will mightily try to pick up the slack. do their functions and services with no added help. the managers that always recruited will be lining up their ducks. The others will work longer and harder, & in so doing demonstrate to executives..they don’t need help.

    The 2nd obstacle will be themselves. If they get permission to hire..they’ll be to “busy” to recruit. they will procrastinate until forced..and likely to knee jerk their hiring

    I do agree that chaos does offer opportunity. The job seeker that does the manager’s work for them and makes a connection with a well thought out value add proposal can make inroads. and as noted if HR is lean, they may find an easier path to the managers.

    They need to start now

    • @Don: I always enjoy your thoughtful counterpoint. Interesting idea that many managers will just try to have their teams pick up the slack while not filling positions. One wonders how (long?) that will play out?

      • As long as they can. There’s a fear factor in play. Fear of job loss in a touch market for job hunters. The execs will play that card with the managers who will play it with their teams. exacerbated by managers afraid to put their heads up and ask for a req. No one will say no..until they do. I’ve always said in times of tight budgets..you have to cause some pain..the pain is not making deliveries. then the light shines on the execs and it hurts the eyes. Then they want instant fixes..and catchup is heavy lifting, especially for those already overworked.

        I also think uncertainty and cost cutting will favor the gig economy. People willing to just work for pay (even high pay) will be attractive. contractors aren’t people..they’re an expense with no benefits.

  7. Some predictions:

    If you’re looking for Tech-related work today, you’re done for 2020. Come back in 2021. The phone won’t be ringing with hot opportunities anytime soon.

    Take a look at layoff.fyi. You’ll be competing with these laid off youngsters.

    If you’re watching your LinkedIn feed, expect to see more in-house recruiters & external staffing recruiters unemployed.

    Expect the tech consulting firms to have additional layoffs. If you work for one of the tech consulting firms & have a high hourly rate, you may be shown the door.

    The booming staffing industry may be under pressure to improve margins. I’d avoid contracting opportunities for the remainder of 2020. Improved margins will be coming out your backside.

    • “You’ll be competing with these laid off youngsters.”

      Gee, ya don’t say. So now people are finally getting it?

      First it was “50 is the new 60” then the scale plummeted to “40 is the new 50” on the age discrimination front. All these employment advisors blaming older employees for not being “positive” as the reason they were shown the door is pathetic.

      As predicted, discrimination continues to grow like a cancer and is now effecting the very demographic (Millennials) that took advantage (shoved out 50-somethings) of it just years ago. So now these “youngsters” are competing against y-o-u-n-g-e-r youngsters – relatively speaking. What comes around goes around.

      Gotta laugh at all the so called “experts” walking on eggshells in an effort to not offend unemployed Millennials still living in their parent’s basement after years of bashing the 50+ crowd.

      • I like to think the youngsters are competing with the rest of us.

        Doesn’t help them to put chips on their shoulders.

    • @Bob: Thanks loads for the layoff.fyi link. I love it! I was thinking about starting a deadpool site listing companies that are folding.

      Interesting list of predictions!

  8. What about those of us who already had the deck stacked against us, before all of this happened?
    I.e. those of us who dare to be 50+

    • Very valid point.
      AARP and other organizations have posted plenty of data on age discrimination (now known as “ageism” in an attempt to eliminate the word “discrimination”).
      In fact, it’s so bad these days that older Millennials (hitting 40) are getting caught early in this discrimination.
      You are correct about this shutdown throwing millions upon millions of younger, underemployed (college degrees working as baristas) workers on top of “old timers” yet all I’ve seen from prior topics on this issue goes something like this: “There is no discrimination of any significance…you just aren’t networking…you aren’t positive…you don’t have updated skills…yada, yada, yada”.
      Now that 40 somethings are being effected, I wonder if the gurus will be telling them to stop whining too?

      • @Chris S,
        Don’t forget this point too in the employers bags of dirty tricks. The narrative goes like this, kick hundreds of older and tenured 50+ workers to the curb, tell them it’s for economic reasons, then in 2 months advertise their jobs on Indeed.com, or start recruiting on college campuses, and hire young folks for less money! Happened to me in 2010, along with 300 other older workers (many with 20-40 years tenure and approaching retirement),and it just happened to a friend of mine (age 64) as recently as April of this year. His former employer told him, and 6 other of his 50+ colleagues, that they were being eliminated due to COVID-19, but ironically, all their jobs are being advertised now on Indeed.com! Talk about smelling a rat in the woodpile.
        There’s a big difference in being a Mr. Rogers rah-rah type, and being a “realist”.
        But, I’m not telling you anything you don’t already know.

    • @Borne: I spoke with a headhunter this morning who told me he’s having no trouble placing people who are 70+ — in the private equity biz. Granted, that’s specialized, and heavy experience probably counts for a lot. But it’s an interesting data point nonetheless. I’m trying to figure out what that tells us.

    • That is my concern as well.

    • @Borne,
      I once struggled with “raining on the just and the unjust”, “what goes around comes around”, “sow the wind and reap a whirlwind”. But now at 62, I believe them, and take some comfort and solace in this. For all the notches I have on my belt, I say this to those who have defecated upon us many displaced older workers, “someday, you might well be older and unemployed, and you might be sitting across the table from some disrespectful and sarcastic young Turk” or “you might be out of work, with the wolves at the door, and sitting across the table from some older malcontent, groveling for a low-level job, and having your nose rubbed in it”.

  9. There is one joker in the big-picture US economic deck and I don’t know how it will affect the demand for workers in several job sectors. I’m referring to the new USMCA trade agreement that will eliminate a lot of goods coming in from Canada and Mexico together with the post-covid emphasis on decoupling and repatriating supply lines for a huge variety of goods. Two questions: will there be a boomlet (or more) in related hiring and, if yes, how quickly will that appear?

  10. @Nick:

    “I think the best managers will handle more recruiting on their own because they know HR has no skin in the game. Fed up with HR organizations that have always shoveled the wrong candidates into interviews, managers will rebel. They will take hiring into their own hands because not to do so could risk their own jobs.”

    I wouldn’t underestimate HR. It’s been my position that many of them have a political/social agenda to transform the workplace through so-called “diversity & inclusion.” So they do have skin in the game, but not in the sense you meant. When they say, “we must, we must hire and promote more of Flavor A,” they mean it and they won’t let go of their power without a fight. They can often be quite open and boastful about it.

    And although it’s unrelated to Covid, the more recent societal upheavals are likely to strengthen HR’s position. I’ve seen a number of posts in my LinkedIn feed from HR people about all the “sensitivity” reeducation they plan to push through in their companies and industries, as well people boasting about the training they just went through (I’m such a sinner but have now seen the light). Somebody has to administer all those programs.

    In many companies, managers who revolt against HR are likely to be subjected to the corporate equivalent of Mao’s Red Guard. In order for managers to revolt, top management may have to first revolt against HR themselves. If they don’t have the guts to do that, the managers will be in a weak position.

    • @Bill: Nobody said this won’t turn into a cluster-F.

  11. Everyone is focused on replacing lost jobs. However, no one is pointing out the new wages for those jobs. I see a downward pressure on wages. I also see up to 60% of a company’s workforce as contingent, working through third parties or through contractual relationships. Most employees are replaceable, and the new jobs will reflect the temporary nature of employment.

    • @Jonathan: Reports already tell us that wages are down. And I agree that companies are even more likely to turn to contingent workers than ever before. However, if you play that out, using temp workers extensively is also likely –in my opinion — to cause decreases in productivity.

  12. Looks like AI use for recruiting might go up, and, if so, they are taking the OPPOSITE approach that Nick thought they would (though if AI is used more, like to write job descriptions, etc it might be used to replace HR as well, though it would be going more impersonal and distanced from the hiring process than having the secret societies of HR vet everyone like had been done for years. So they’re replacing HR with the one thing that is WORSE than HR: AI!!!):

    https://qz.com/1878476/ai-hiring-tools-aim-to-automate-every-step-of-recruiting/

  13. @Mongoose Lover

    That would be rich: AI generated job descriptions. In my industry, graphic design, the latest flavor of the last couple years has been UI/UX (user experience design), and the job descriptions NOW are utterly incomprehensible, so riddled are they with acronyms and buzzwords. I’ve pretty much stopped reading them. Who needs the aggravation? Then again, it might be yet another way of weeding people out, everyone but those in an “inner circle,” who (wink, wink, nod, nod) know what they mean.

    It’s been my experience that most HR departments don’t know how to put together lists of skills and descriptions in a straightforward way for most jobs, let alone specialized areas such as UI/UX design, or engineering or architecture. They are confused enough as it is. If they are the ones inputting info into an AI computer, THAT would be exponentially worse indeed.

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