Adam Radly and Bob Bates Recommend:
Adam Radly Bob Bates have hired many people in different economies for their own ventures. One important question is – should you lower your standards when unemployment is low and it’s difficult to find high-quality candidates? This interesting article in the Harvard Business Review about what to consider when you’re hiring in a strong employment market.
Although the unemployment rate is currently at a historic low of 4%, economists are still struggling to understand why it remained so painfully high after the Great Recession—and why it took five years to return to its pre-recession level. Our research points to one possible reason: employers increased skill requirements during the recession, when high-skill workers were more plentiful, making it more difficult to fill those positions as the job market began to recover. However, since then, some employers have been lowering education and experience requirements in an effort to clear the backlog of open vacancies.
First, some context. Typically, there’s a stable tradeoff between the unemployment rate and the job vacancy rate (this is known as the “Beveridge Curve”). During a recession, the job vacancy rate falls as the unemployment rate rises, and during a recovery, the reverse happens. However, after 2009, despite employers reporting an increasing number of vacancies, the unemployment rate hardly budged, resulting in an outward shift in the Beveridge Curve that persisted through the end of 2017.
See the rest of the article here.
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