Should High Unemployment Rates Impact Hiring Decisions?
Unemployment Rate and Hiring in 2020
Here’s a brief recap of what we have learned in 2020: the world shut down, masks became an everyday necessity rather than something you just wear on Halloween, and coronavirus went from not appearing on Google, to being one of the most searched terms in April of 2020. Search queries have consisted of everything related to coronavirus; cases, shut down guidelines, and unemployment related questions. All of these topics have been at the forefront of people’s minds.
How Unemployment is Affecting Life Sciences Industry
As leaders within the life sciences and talent acquisition industries, the unemployment rate has been a topic of concern for both our clients and candidates. We wanted to address the unemployment rate by comparing other industries to how the life sciences industry has been impacted.
The Impact of US Unemployment Rate
As the United States adjusted to social distancing and pandemic related healthcare issues, there was a direct impact on the countries economic stability. The United States lost 20.6 million jobs, resulting in an unemployment rate of 14.7%, a level not seen since the Great Depression. Economists warn that this may take multiple months, even years to recover from.
Unemployment Impacts Compare to The Subprime Mortgage Crisis (The Great Recession)
*Based on estimates from Bureau of Labor Statistics
If you look at the chart above, you can see a significant uptick in the unemployment rate during the January to July time span of 2020. This spike to 14.7% unemployment surpassed the 2008 subprime mortgage crisis, which spiked to approximately 10% unemployment. That 10% was previously known to be one of the most significant economic collapses since the Depression in the 1920’s. According to the PEW Research Center, 17% of all adults have lost their job or been laid off. An additional 23% have taken a pay cut this year. This makes a total percentage of people who were net or both 40%.
Industry Plays A Big Role
When compiling data to see what industries were the most at risk in terms of short term unemployment due to coronavirus, the professional, technical, and scientific fields consistently placed low with more jobs being created than taken away. While the most vulnerable industries are in food service, customer service, and retail sales. The lowest impacted hitting almost zero are health and STEM professionals. In fact, according to an article by Market Watch, it is predicted that healthcare workers would likely experience an increase in demand. Before coronavirus, there was already a shortage of over 1 million healthcare jobs according to Burning Glass Technologies.
Front Line Workers in Life Sciences
As life sciences recruiters seeing this information is reassuring. Having a strategic focus on an industry focused on healing, feeding and fueling we find that being life sciences recruiters lands our clients on the front lines and their work is irreplaceable when it comes to managing the pandemic.
Are the Applicants Qualified?
So should the high unemployment rates caused by the pandemic impact the hiring decisions and talent acquisition strategies for life sciences companies? The data provided above tells life sciences recruiters that there may be a greater pool of applicants looking. However, the influx of applicants are unlikely to have the technical capabilities that life sciences clients are looking for.
For example, personalized medicine companies that specialize in cell & gene therapy, were already struggling to find qualified talent for their innovative industry pre-pandemic. There is such a demand for these quality candidates that drug developers are working within academia to develop customized curriculum that revolves around these topics. These advanced degrees are a great option for displaced workforce looking to make a career change. However, in the short term, if life sciences companies continue to see an influx of applicants; they will likely need to invest more time screening and selecting from a larger pool of applicants for the same amount of qualified individuals.
Outsourcing Talent Recruitment
From a talent side of things, the individuals within the life sciences industry also seem more likely to make a career move during the pandemic. Since there is a high demand for a change in career, the importance of leveraging life sciences recruiting firms is critical. These firms network with passive job seekers who are seeking new and innovative opportunities. Having this process outsourced saves the life sciences company time and money by significantly decreasing the time for a position to be filled.
Investing More Into Talent Acquisition Efforts Will Bring Higher Return
With a higher supply of individuals seeking jobs, life sciences organizations need to invest more into their talent acquisition efforts to ensure their decision makers and operations managers aren’t investing critical time interviewing under qualified individuals. The pandemic has only made the pool larger, with the unemployment rate higher overall, so using a life sciences recruiting firm is fundamental in finding the right candidates to further your business.
Want to tell your friend about this post and give them a brief overview? Here are some quick takeaways about what you just read:
- Unemployment Rate is at an all time high that will likely result in a large recovery time
- Technical Industries found to be less affected when it comes to job loss
- Larger pool of candidates makes it harder for internal operations to fill critical positions because the supply of qualified candidates has not increased.
Check back in next week and get the newest information on trending topics.
United States Bureau of Labor Statistics