Black Friday and Cyber Monday are history. The Holiday Season came and went, and for many of us, we felt that familiar urge to spend some money. But our spending capacity has changed considerably over the last five years. Despite the recent uptick in economic activity, most people remain worried about their economic future. But the heavily-reported high unemployment numbers obscure a much more nuanced economy. Look beneath the surface of the mass media and you’ll see that there are two economies—one for the overall household economy and another for the corporate economy. The first is indeed bleak and worrisome. The latter is cautiously optimistic.
The general economy has undoubtedly been free-falling over the last five years.
- Since the housing and financial markets began to collapse, about 39% of all Americans have been foreclosed upon, unemployed, underwater on a mortgage, or behind more than two months on a mortgage.
- Almost $7 trillion of homeowner equity has vanished, and homeowners’ equity as a share of home values has dropped to less than 39 percent, down from almost 60 percent in 2005.
- And according to a recent report by the Federal Reserve, household net worth fell 4 percent in the third quarter of 2011, the sharpest decline since 2009.
There is no doubt that people are feeling the crunch at home. But our story doesn’t end here.
Meanwhile, Corporate America has more than $2 trillion in cash on their balance sheets with technology, health care, and heavy industry leading the way. According to a recent Wall Street Journal article, companies in the S&P 500 have enough cash to operate for more than six years. These companies have transitioned to a leaner workforce, paid down debt, and invested in technology. With costs cut beyond what many thought possible a decade ago, company leaders are now looking for innovative approaches to drive top line revenue.
A major area of focus? Transcendent executive talent. After shedding hundreds of thousands of jobs over the last five years, Corporate America needs innovative executive leadership.
Many companies currently lack the people they need to move forward, especially from mid-management through senior management. Trend data from SimplyHired.com, a job search engine, reveals that executive jobs increased 16% between February and August 2011.
Yet despite the high US employment numbers, finding the right leadership talent is both challenging and frustrating. Skeptical? Post a position on a job board site and prepare for an avalanche of applicants. We recently worked with a client looking for a Human Resources Executive. Prior to engaging us, this client relied on job board postings to find candidates. They received scores of unqualified applications for VP of HR, including a butler and a bartender.
Under-qualified. Over-qualified. Potentially-qualified. Remembering that many companies are now operating on skeletal workforces, who has the internal resources to sift through thousands of resumes?
This challenge is amplified by the fact that so many qualified candidates are not actively searching for new opportunities. Even if they’re interested in a career move, many are staying put. In times of uncertainty, their current positions are far too valuable to risk. In addition, this lean environment demands more work from this top leadership set than ever before. Imagine actively looking for a new executive position when you’re currently investing 60-75 hours per week in your current one.
And so the talent gap persists. Companies are realizing that they must re-invest in executive talent. They also recognize that partnering with an executive search firm increases their success rate. As a result, executive recruitment is booming in many sectors across America.
Human Resources recruiting is a good example. According to Wanted Analytics, a Quebec City-based research firm that focuses on employment trends, the demand for HR professionals has increased by 28 percent in the past year. In August alone, more than 6,800 new jobs were advertised online for Human Resources positions, a 33 percent increase from the same period in 2010.
That jump is not unique to HR recruiting. We’re seeing strong placements in manufacturing, accounting and finance, sales and marketing, and other sectors. Companies are pursuing transcendent talent to drive future business success. The growth is real, and it’s gaining momentum.
As we begin a new year, I hope that you too are feeling the uptick and positive energy in Corporate America. And like us all, I look forward to these gains finding their way into our households – and into our wallets – once again. I’m interested in what you’re seeing in the hiring markets, and I welcome your thoughts and conversation. Please comment below.
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