• Wider adoption of programmatic advertising and virtual fairs by sites
  • Recovery in demand for some jobs has been dramatic
  • Diversity hiring has become a key employment driver

U.S. recruitment marketplaces are battered and bruised, but off the critical list as we begin entering the post-Covid world. Most are enjoying a brisk recovery.

It’s an industry that weathered a stunning global shutdown but is now primed for the hiring recovery that’s under way in the U.S. and Canada. That’s the picture we got in conversations with talent acquisition leaders, job board executives and recruiting consultants.

Change is under way, too, along with recovery.

“In many ways,” said Maggie Hulce, SVP and GM-enterprise of Indeed, “Covid turned out to be a catalyst for innovation — and a catalyst for change in how companies hire.”

Julia Pollak, ZipRecruiter’s labor economist, said the impact of the initial pandemic-related business shutdowns in March and April of 2020 was a “huge jolt” to the employment industry.

“But then we saw hiring recover really rapidly in the summer. That growth sort of slowed down a bit in the fall, and then totally plateaued in the winter,” she said, echoing what other job boards experienced and what U.S. Bureau of Labor Statistics data shows.

Now, though, “employer signups and postings have skyrocketed,” Pollak observed.

Her comments were echoed in almost every discussion we had. “Basically, it’s one big sigh of relief [about current conditions],” job board consultant Jeff Dickey-Chasins told us.After revenue and traffic fell as much as 90% at some sites, the industry began to recover quickly, he said. “By late fall, most of [my clients] were saying that they were back about to where they were a year ago.”

More than just a short-term change

If the story of the pandemic was merely about a major hit and quick recovery, this would be the end of it. But the shockwave was much more far-reaching, forcing employers and workers to rethink their very ways of doing business.

As serious as the global recession of 2008 was, it was a classic recession. But the pandemic is very different. It fundamentally altered how we work and where we work. That much of the impact has been well reported:

  • The discovery by employers that productivity is unaffected, even improved in some cases by remote work.
  • That interviewing and hiring can effectively be done virtually.
  • The increased interest in gigs and freelancing by workers embracing the freedom of a varied work life, along with the concurrent growth in hiring of contract workers.

The broader impact of the pandemic on the job board industry can’t be underestimated.

Responses: Predictable, and unpredictable

We found recruitment marketplaces responding to Covid challenges in both predictable and unpredictable ways.

There was some price cutting and contract adjustments, with special packaging or short-term free provision of additional services. Other sites provided more employer value by enhancing job posts and adding new categories of job searching. Remote and virtual work was popular. Some added an “essential worker” category and offered free ads for first-responder and healthcare positions. Others added virtual interview tools, either by working with third- party providers or, like Indeed, developing their own.

Recruitology built a virtual career fair platform for its white-label job board customers. CEO Roberto Angulo said it incorporates an AI feature that analyzes resumes and applications and matches candidates to the right employer. For the recruiter, it ranks candidates waiting for an interview, recommending who to interview first.

Programmatic, diversity, evidence

We heard about innovative trends and challenges that Covid brought into sharp relief:

  • The growth of programmatic buying offers benefits to high-performing sites, while threatening to disrupt marginal ones.
  • Driven now more by the Black Lives Matter movement and their own employees and boards than government requirements, employers are making diversity hiring a priority. This could be a boon to diversity-and-inclusion sites. Ironically, it could also hurt them.
  • There’s a shift away from hiring based on resumes, toward evidence of skills and competencies. Sites that develop or work with learning and certification vendors are most likely to prosper.

Covid’s initial effects

When the pandemic began in March 2020, governments everywhere began ordering shutdowns. In the U.S. and Canada, that meant all but essential businesses had to close or go remote.

In one month, private sector employment in the U.S. dropped by 1.6 million. And by the end of April, 20 million more Americans were out of work. Openings fell by more than 20% in a matter of weeks.

Job boards responded by cutting fees, creating new job categories and offering free listings for healthcare workers and other essential and first-responder type jobs.

At Indeed, the world’s largest job marketplace, listings at the end of April had plunged 39% below their February 1, 2020 baseline. Monster’s revenues, which were in decline well before Covid, dropped 20% in Q1, then fell 31% in Q2.

Overall, the industry was hit hard, Peter Weddle told us. He leads TATech, a trade organization for job boards and HR tech providers. The hurt wasn’t spread evenly, though.

Applicants scarce in some categories

The pandemic “hit some job boards very hard,” he said, particularly niche sites in segments such as hospitality. “Ironically,” Weddle observed, “even those that you thought might be relatively immune to Covid problems, like warehousing and logistics, struggled a bit.”

But not for long. Demand jumped so fast and so dramatically for some types of jobs employers struggled to find enough workers to hire despite double-digit unemployment. Amazon, just one employer, albeit one of the largest in the United States, hired 427,300 employees worldwide in 10 months of 2020, bringing its global workforce to more than 1.2 million.

Chris Forman, CEO of the programmatic firm Appcast (owned by StepStone / Axel Springer), said applicants became so scarce for jobs in logistics and for some types of jobs in retail and healthcare that the cost of advertising these positions jumped.

Programmatic pricing varies

“It cost more to get a job-seeker to click on an ad for a warehouse job than it did to get a job-seeker to click on an ad to apply for a technology job in Austin, Boston, New York, Chicago and San Francisco,” he said.

When we spoke in mid-February of this year, the cost-per-click for many blue-collar jobs was still higher than for software developers, he said, and it’s likely to stay that way for some time.

“What the data is telling us,” Forman says, “Is that there may be this new front where what we’re looking for is good, hard-working folks willing to do more of a traditional blue- collar job, and that those hires are almost as important to the growth of these big companies as finding (white-collar) folks.”

Now, as we begin to emerge from the Covid cloud, the overall recruitment market is recovering. More than a few sites will report year-over-year improvement for Q1.

Indeed’s U.S. job postings were up 5.7% in February over the year before. The improvement is all the more remarkable since Indeed tells us that job postings from the hospitality and tourism sector are still off 32.6%.

Likewise, ZipRecruiter’s job post counts were 15% ahead of February 2020.

Hiring across various sectors

Where is the hiring coming from? No surprise: delivery, warehousing, food and beverage stores, construction, general merchandise, retail and a few others.

That tracks with what Hulce, of Indeed, told us has been happening almost all along.

“Throughout the Covid period, we saw many companies consistently hire,” she said. “It was clear that they were needing to hire in new ways.”

The end of resumes?

The most potentially disruptive innovation to come out of the pandemic is employer acceptance that resumes and applications are not as important as they’ve always believed.

Indeed turned this once far-fetched idea into a reality, launching Indeed Hiring Platform, an integrated tool for volume hiring that relies on skills testing and certifications to decide who gets interviewed.

The technology itself is unremarkable, though it does streamline the recruiting process by eliminating the need to use third- party vendors. Performing some of the same functions as a basic applicant tracking system, Indeed Hiring Platform lets recruiters create and post job openings, schedule interviews, qualify applicants, conduct interviews and even make job offers from a single place — all virtually.

The disruptive part is that no resume or application is needed. Candidates are accepted or rejected for interviews based on screening questions and assessments. In a nod to traditionalism, a resume can be required.

Disrupting the hiring platform

“The hiring platform is one of our key areas of focus to disrupt, at least for Indeed, the concept of what a job board is, and how it serves employers,” Hulce said.

“We’re trying to challenge a lot of notions of the traditional apply and look at a pile of resumes and screen through them and then schedule who should progress manually,” she explained. “The recruiter’s job can be automated and can begin with the first interview with a candidate that meets all your objective criteria.”

The idea of ending reliance on resumes goes back years. One of the world’s leading human resources consultants, Dr. John Sullivan, declared in 2012 that resumes as a screening determinant were not just lacking in substance, they were contributing to bad hiring.

Emphasizing skills and competencies

By putting the emphasis on skills, Indeed’s new hiring platform does what Sullivan and others suggested. It substitutes competency as demonstrated by certifications, licenses and assessments.

Will employers embrace no-resume hiring?

Indeed says many already have: “More than 200,000 job seekers have already connected with employers on Indeed Hiring Platform,” and 20,000 hires have been made that way.

Dickey-Chasins, the industry consultant, said the emphasis on skills over experience as evidenced by a resume was beginning before the pandemic. Job boards were working with learning and training vendors to enable job-seekers to earn certifications or demonstrate their mastery.

“There appears to be a greater willingness by employers, at least in some sectors, to accept people without formal credentials if they can prove their skill sets through tests or certifications,” Dickey-Chasins said. “And job boards had already been trying to address that in a variety of different ways.

“I think that’s going to be a fundamental change. That’ll be a shift from job boards that focus on resumes, and more to job boards that start focusing on the credentialing and adding assessments and screening.”

‘A three-sided marketplace’

Pollak of ZipRecruiter sees this evolving into a “three-sided marketplace” with training and learning as the third leg, beside employers and candidates.

“I think the most exciting movement is the increased integration and collaboration between job search sites and skills providers,” she said.

In the fall, ZipRecruiter partnered with training sites like Coursera, Udacity and EdX to make specific training recommendations for job-seekers.

Next on the horizon, Pollak said, is a comparison feature showing candidates not just what jobs they qualify for –– something ZipRecruiter already does — but which better ones they could get by improving their skills, and referring them to specific courses.

With the World Economic Forum predicting a need to reskill half the world’s workforce at a time when U.S. education budgets are tightening and junior-college enrolments are declining, Pollak said, “This is really a prime time for [online learning] to take off.”

VCs flock to online learning

Investors clearly agree. Last year they poured $666 million into learning and training firms and startups in the human resources sector. It was the first time in years that recruitment marketplaces ($483 million) didn’t lead in human resources investment.

George LaRocque, an authority on investment in the HR sector, said Covid refocused investors on other HR sector businesses “for obvious reasons.”

“The pandemic and the shift to remote work flipped [investor activity],” he observed, explaining later in our conversation that HR and talent acquisition leaders are focused not just on filling current jobs, but on reskilling and training.

Even though employees “are taking an active interest in their own skills and their own future, I’m not seeing employers really providing that path internally,” LaRocque says. “I think that’s where you’re going to see job boards providing that skills enhancement. I think we’re going to see a lot of that. And I think whoever gets it right, is going to have a big play.”

“It’s something that I’ve been watching the last few years. I think it’s going to take off here soon.”

Reluctant to make specific predictions, LaRocque said that from his conversations with investors he expects 2021 to be at least as strong a year as 2020 for HR investment, probably even bigger.

Within the marketplace arena, LaRocque says, “Investors seem to be looking for the next thing or looking for what aligns with the trends in remote work, gig work, contingent work, and so on.”

The threat from programmatic buying

In every conversation we had, diversity hiring was mentioned as a key employment driver in 2021. Diversity hiring has long been an imperative in many cases driven by a combination of government monitoring and the periodic spotlighting of shortcomings by activist groups. The Black Lives Matter movement, and the demands of employees and investors now are providing added impetus.

Yet at the very time that diversity sites should be reaping the benefits of this — and, to be sure, many are — programmatic advertising poses a significant threat to these marketplaces.

“Some of those boards are going to go under,” said Gerry Crispin bluntly. “It’s yield,” he explained. “It’s about making hires. The OFCCP” — the U.S. government agency requiring contractors to have a diverse workforce — “is only interested in whether or not you hired somebody, not where you go [to get them].”

Crispin’s CareerXRoads consultancy counts many of the Fortune 100 companies as clients. They all use job boards; most also use programmatic buying services.

At base, the calculus is not complicated. Job postings are spread across a career site network that may have hundreds, or in the case of Appcast, thousands of marketplaces. Whether the model is CPC (cost per click) or CPA (cost per applicant), algorithms consider activity, cost, and rules shifting the ad spend to those sites producing the best results.

“If that’s Indeed, I don’t care,” a corporate talent acquisition leader told us confidentially. “It’s the ROI that matters.”

Diversity sites needed for diversity?

“When you advertise across a wide swath of traditional job sites — sites that do not focus on diversity and inclusion — you still reach a diverse audience, particularly when the goal is diversity in terms of race and ethnicity,” notes an Appcast Research report on diversity.

Citing that report, Weddle, of TATech, summarized the findings: “The best way to do diversity-based recruiting is not to focus on diversity sites. The best way to ensure that you actually get a diverse yield is to make sure that your job ad is posted as broadly as possible on those sites where you’re going to get a good applicant flow. And that’s the sweet spot for programmatic.”

While most of our conversations focused on diversity sites, other niche and specialty sites are subject to the same market forces.

As Crispin said, “The fact is, job boards will [have to] become more effective for what they are useful for as part of a hiring strategy. Bottom line, that’s what will happen. Job boards will become more effective for what they actually do produce.”

The advantage of professional associations

No one is predicting the death of niche and diversity sites, however.

Recruitology’s Angulo says niche sites run by professional associations have the advantage of an engaged audience of users who visit for reasons other than job searches. Employers use those sites for more than just posting jobs. “They just want to get visibility,” he says, meaning there’s a value to them to build their employment brand with a specific audience.

Employers also look to specialty niche sites to promote and increasingly to host targeted career fairs, he said.

Virtual career fairs may keep growing

Recruitology began offering a virtual career fair platform last year after Covid ended in- person events. Angulo told us several of the marketplaces Recruitology powers as a white-label provider have held virtual fairs. He expects the market to grow, even when the pandemic ends.

However, one problem is that niche and other job sites are failing to build relationships with job-seekers, Weddle said, along with “the ability to establish themselves as a resource for employers in a particular niche or particular specialty.

“They really knew how to connect with those individuals in [a particular] field of work, and attract them to their websites. They knew how to write the right content. They knew how to connect with organizations that serve those populations. They were just really good at attracting their own job-seeker traffic,” he said. “That skill has largely disappeared.”

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