The Future of Recruiting

You were rocked by the pandemic and rose to the challenge of the Great Reshuffle. There’s no question that recruiting is becoming more strategic, and 70% of TA pros say the team can claim a seat at the proverbial table.
 
But now recruiting leaders “have the opportunity to actually change the seats at the table,” says Microsoft’s Brett Baumoel. “You’re going to truly change the table itself.”

As a change-maker, your influence will be felt across the C-suite — from talking comp with the CFO, to fine-tuning your employer brand with the CMO, to addressing skill gaps with the CLO (chief learning officer).

Rising inflation. Stagnating real wages. A stubbornly competitive labor market. With these three trends on a collision course — and compensation ranked as the #1 top priority for candidates globally — something has got to give. 

The feedback loop between recruiting, finance, and DEI on discussions of comp needs to be more agile than ever — particularly at a time when pay transparency is on the rise. Recruiting leaders can help their companies stay ahead of the curve by raising this conversation today. 

As the leader with the clearest view of candidate priorities, labor market dynamics, and real-time recruiting performance at your company, you’re in the best position to lead the conversation about pay and its business impact — from championing comp models that favor skills over pedigree, to retaining your top talent by pushing for pay increases that keep pace with inflation.

Jump to predictions about economic uncertainty ↓

Recruiting leaders know the competition for talent has not let up, even as hiring has slowed down. While less hiring typically means less power for workers, recruiting teams see that dynamic swinging back in the opposite direction over time: 64% predict that the future of recruiting will be more favorable to candidates and employees (as opposed to employers) over the next five years.

That’s why refining and conveying a clear, compelling employer value proposition (EVP) is more important than ever. With most recruiting budgets expected to shrink or stagnate, employer branding stands alone as the only line item where a majority of TA pros expect an increased investment this year. But investing in employer branding won’t get you far if you don’t work to understand talent’s top priorities and authentically walk the walk. 

Jump to predictions about employer branding ↓

The skills companies need are changing fast. As LinkedIn’s CEO likes to say, “even if you aren’t changing your job, your job is most likely changing on you.” Recruiting teams themselves are no exception. 

Adaptability, problem-solving, and business acumen rank among the top five soft skills recruiters will need in the future. As TA pros become more strategic partners, they’ll need to adjust on the fly and find solutions that ladder up to overarching business goals.  

As companies align around skills-first hiring, recruiting teams will have to consider which skills they value most — in the workforce at large, and within their own recruiting orgs.

Jump to predictions about skills-first hiring ↓

The walls that once divided recruiting and learning and development (L&D) are coming down fast. While three out of five (62%) TA pros say they’re already working closely with L&D, an even larger portion say they’ll still need to grow closer in the future.

As recruiting leaders’ portfolios expand to include things like internal mobility, skills-first hiring, and employee retention, they’ll need to cooperate more with L&D to prepare internal talent for new roles, identify skill gaps, and ensure your company is a place people can grow their careers.

You’ll hear the same from L&D professionals: 47% say they’re working more closely with TA this year, according to LinkedIn’s Workplace Learning Report. Those respondents also say the #1 top focus area for L&D will be aligning learning programs to business goals — where recruiting can play a complementary role in understanding what skills the company needs.

Jump to predictions about internal mobility & upskilling ↓

Generative AI (GAI) — i.e., tools like ChatGPT that intelligently generate content — is a fascinating new technology that holds promise for talent professionals, many of whom believe it can help in time-consuming tasks, like drafting job descriptions and personalized messages to candidates, among others.

While two-thirds (68%) of hirers surveyed in February 2023 said they were “very hopeful” or “cautiously optimistic” about the impact of GAI on recruiting,* hiring influencer Glen Cathey characterizes himself as “cautiously exuberant.” He believes GAI can save a ton of time and let recruiters focus on the most human aspects of their jobs: listening to candidates, understanding their desires, and helping them find a new job they feel good about. 

While GAI may help draft content, it’s crucial to keep a “human in the loop” — someone with the right know-how should always be there to carefully review and fine-tune generated content. “You still need to keep your hands on the wheel,” Glen says.

In an uncertain economy, you might think employers would pull back on efforts to diversify their workforces. Fortunately, that’s not the case.

Though most recruiting pros say hiring overall has been negatively impacted, three out of four say that diversity, equity, and inclusion (DEI) hiring is not being deprioritized — in fact, nearly 20% say it’s a higher priority now. 

Work on DEI goes back decades, but it became a focal point for many in 2020, when a wave of companies pledged to make progress on diversity. Whether they deliver on that largely remains to be seen, and you might look at these survey results with the same skepticism — is it aspirational happy talk, or a real plan of action? Employees, candidates, and consumers alike will hold businesses to their commitments.

As uncertainty grows, businesses need to be more nimble and responsive to sudden shifts in the market. To do so, employers may increasingly rely on contingent talent, like contractors or gig workers, whose labor can be scaled up and down on demand.  

In the US, for instance, LinkedIn job posts for contract positions are growing much faster than job posts for full-time employees, which is relatively stable. (Note: contract positions mean labor is “contracted” out to a company for a finite amount of time listed by a contract, and can be full-time or part-time work.) 

You can see this dynamic at play within recruiting teams themselves, though the data suggests a more stable split: 22% of companies expect to spend more on in-house recruiters this year (vs. last year), while 23% expect to invest more in external staffing firms. 

The labor market remains tight, and talent is expected to retain the upper hand over the next five years. To stay competitive, employers will have to reexamine their employer branding and make sure it aligns with what candidates are looking for today.
  
Every month, LinkedIn surveys over 20,000 members about the most important factors they weigh when considering a new job. The top priority for candidates today is excellent compensation and benefits, by a fairly wide margin, followed by work-life balance and flexible working arrangements. Flexibility and comp are also the two fastest-growing priorities year over year. 

There’s much more to your employer brand than good pay and flexibility, and offering them may not make you stand out — but be warned: if you don’t provide them, talent will take notice.

Gen Z — professionals born later than 1996 — are already a major part of the workforce. Many are just getting their careers off the ground, and their priorities reflect that. 

Gen Z’s priorities are significantly different from their parents’ generation, Gen X. Career advancement and gaining new skills are super important to younger workers: they’re nearly 50% more likely to value these opportunities, compared to Gen X. 

The younger generation is also much more focused on the importance of having an inclusive work environment.

Slowly but steadily, employers have begun to embrace skills-first hiring — the practice of valuing a candidate’s skills over more superficial signals like an impressive alma mater or previous employer.

Since 2019, the share of recruiter searches on LinkedIn that include a skills filter has grown by 25% — and today, recruiters are 50% more likely to search by skills than they are to search by years of experience.
 
Now, skills-first hiring is poised to be the way of the future. Three-fourths of recruiting pros say it’ll be a priority at their company. But for some, their reach still exceeds their grasp: only 64% feel they can accurately assess candidates’ skills today. Clearly, they’ll have some catching up to do over the next few years.

If you’re not convinced yet that skills-first hiring is the future, consider this: by being more open to candidates who don’t have college degrees, you’ll be taking a big step forward in diversifying your workforce.

There’s a growing consensus that removing four-year requirements is one of the most important things you can do to promote diversity. Members of underrepresented groups are far less likely to have attended college — but that doesn’t mean they don’t have the skills and potential to succeed. Research shows that workers who didn’t go to college but have experience perform almost as well as college grads on critical measures like productivity.

Today, one in five US job posts on LinkedIn don’t require a four-year degree. That number is expected to grow as more employers look to hire people from a multitude of backgrounds who can bring different perspectives to their organization.

Skills have become a critical currency, and companies will need greater visibility into what they do and don’t have. Forward-thinking employers will map the skills of their workers as well as the skills needed for specific positions. 

A whopping 94% of recruiting pros told us that understanding employee skills is required to make informed talent decisions — though slightly less (84%) say it’s currently a priority at their company.

Mapping employees’ skills will help you do a better job spotting skills gaps. It will also make it easier for you to match qualified workers within your organization with open roles. Employees, in turn, will have an easier time finding job opportunities that fit their capabilities. 

For this to work, however, TA teams must distinguish between which skills are truly “must-haves” for a role — and which are merely “nice to have.”

Your company’s next great hire might already be on the payroll. The shaky economy is forcing companies to look within more frequently when filling open positions: 75% of recruiting pros say internal recruiting will be an important factor shaping the future recruiting over the next five years.

Internal mobility provides big payoffs, starting with higher employee retention. LinkedIn data shows that employees stay at companies almost 2x longer if the employer is highly committed to internal hiring.  

There’s also a growing probability that you will be adding internal mobility to your responsibilities. As someone who understands your company’s talent needs and is skilled at sourcing, assessing, and engaging with candidates, you’re uniquely positioned to take on internal mobility.

With companies facing serious skills gaps, it’s no wonder 81% of recruiting pros say upskilling and reskilling employees will be an important factor shaping the future of recruiting over the next five years.

But there’s another reason why L&D is gaining more attention: employers understand that offering learning opportunities will be critical to advancing diversity and inclusion. 

In fact, when LinkedIn asked members how they’d like to see organizations be more inclusive of underrepresented groups, “increasing professional development and advancement opportunities” was the #1 answer in several countries, including India, Brazil, Italy, Mexico, and Japan.

“If I join your company, will you help me develop new skills?” “Will you offer me a clear path to advancement?” “Will you help me grow, even if I only stay at your company for a couple years?”

These are the kinds of questions candidates are asking and they will only get louder in the future. In the years ahead, candidates won’t just be thinking about a given job but whether that employer is the right career destination. This will be especially true for Gen Z, but holds true across the global workforce: advancement and skill development were the #4 and #5 top priorities for all candidates.  

The bottom line: creating a culture of learning and focusing on internal mobility isn’t just a must-have to engage and retain current employees — it will be critical to the success of your recruiting efforts. For more on the state of learning, explore LinkedIn Learning’s recent 2023 Workplace Learning Report.