Reflecting on the year 2023, it’s clear that recruiters went through different challenges in talent acquisition, sourcing and employee retention. While the European labour market is still crying out for a number of changes in policies, especially to fix the flaws in the ILO (International Labour Organization) system, recruiters need to make progress inspite of the challenges.
Recruitment in general is facing its share of highs and lows, ranging inflation impacting wages, resignations, migration, layoffs due to recession and high interest rates, and more that profoundly impacted recruiters. In fact, we can say that in 2023 the fundamental problems on the labour market only became worse, but due to the low unemployment there is no real urgency. It almost seems like we keep rubbing a stain that only gets bigger but because it doesn’t smell, we ignore taking relevant actions to fix them.
The labour market could use some fundamental change, but we cannot expect that change in 2024. Until then, we continue to rub the pre-existing stain. Since the labour market is having historically low unemployment rate and higher rate of workers and labour participation, it is easy to ignore the need for the fundamental changes.
“The stain does not smell yet or so we like to look away and pretend we do not see the stain”
In 2024 the labour market is becoming slightly more spacious, but remains very tight. The infinite growth models of RPO- and staffing agencies seem more difficult when they completely rely on LinkedIn. Those who have invested in a candidate-oriented approach with talent pools, professional recruitment systems, trained recruiters, recruitment marketing automation and those who are now experimenting with AI, could grow very quickly in 2024. Let’s explore other trends to prepare for 2024.
1. Blue collar work and practical education is hot
A new study by the World Bank, ILO, and UNESCO predicts a big increase in training for job skills in the next 20 years. As AI becomes more popular in the coming years, many white-collar jobs would likely be taken over by AI. Where white-collar jobs are being replaced, blue-collar jobs, and jobs based on practical skills are in high demand.
With an increasing senior population, there is a greater demand for healthcare workers.
This means that additional physicians, nurses, and healthcare support professionals are needed to provide proper care to an ageing population. And with the worldwide shift to cleaner and more sustainable energy sources, there is a high demand for practical engineers. Professionals knowledgeable in renewable energy technology, electric vehicle infrastructure, and energy-efficient systems, for example, will play an essential role in crafting a greener future.
There becomes an urgent need to fix formal technical and vocational education and training (TVET). Because more students are finishing lower levels of school and the population is growing, there should be a lot more TVET students in the next 20 years. The link between TVET and job markets is broken in many countries, and urgent action is needed due to big changes like globalization, technology, demographics, and climate change, which affect job needs and opportunities.
2. Focus on productivity
In the labour market, we will have to do more with “too few” people in the coming decades. The emphasis is on ‘too few’ people and not on ‘fewer’ people. The working population has never been as large as it is today; more than 199 million in the European Union. And there is still plenty room for growth only looking at labour market participation, even if proportionally more people retire in the coming years.
There is still more than enough scope within the European working population, with working from home, self-employment and increasing vitality positively influencing this labour volume. It is good news because as the population ages, the pool is becoming smaller and the demand for labour (both in welfare, recreation, healthcare, etc.) is only increasing as the group continues to enjoy healthy long life.
To avoid overburdening the working population (and that does happen, see trend 13), it is important that labour productivity rises faster than it does now. It means innovation, robotization, automation and digitalization must be embraced, especially if the solution cannot be found in more labour migration. Thankfully, this already seems to be on the rise in recent years and will be further accelerated with the AI revolution.
With the persistent tightness on the labour market, increasing productivity is perhaps one of the most important recruitment instruments
However, technological changes often require more people before they have reducing effects. The question is therefore whether this will tech help ‘us’ in the coming years? At the same time, with the persistent tightness on the labour market, increasing productivity is perhaps one of the most important recruitment instruments’. The right person in the right place and increasing job satisfaction are things that can have a direct impact on productivity.
Recruiters can take a few steps to contribute to that level of productivity
- Improve the quality of hire — this has a huge productivity effect of over 10%.
- Improve retention, including increasing internal mobility and career development at all levels within the organization
- Implement total talent management so that permanent/flexible are in balance
- Better matching, through the use of parties such as Pera, Brainsfirst, Thomas International and Traicie among others.
- Investing in the quality and professionalism of recruiters.
- Investing in vitality in the broadest sense of the word
- Making job satisfaction a part of KPIs for management and leadership
Within recruitment and HR, productivity, productivity improvement and impact on productivity should be one of the most important KPIs to tackle the shortage.
3. AI is the trend, but it is not breaking through yet!
Artificial intelligence (AI) with the arrival of ChatGPT, OpenAI, (LLM, Generative AI etc.) Bard, Gemini, Mistral, and the several thousand GPTs and equivalents, already have a gigantic change in our lives. This goes much further than just work, the labour market, HR, Career and/or Recruitment. Since December 2022, this has been the trend and hype that you cannot ignore. 2024 will likely not yet be the year of AI’s breakthrough, but AI will be all around us.
Of course, OpenAI has already been implemented in every self-respecting VMS, ATS and other HR system. This is a good step forward, especially when it comes to writing vacancy texts, managing campaigns or calculating recruitment KPIs, communicating with candidates/sourcing and hundreds of other examples. However, in 2024 we will be overloaded with new functionalities, examples, use cases and best practices from leading parties such as Wortell, SteamTalmark and Capgemini already do that now. But the real game changer will really be the broad rollout of Microsoft CoPilot within our daily use of Word, Excel, Teams, PowerBI and Powerpoint. This, together with the rollout of ChatGPT 5 and Gemini in 2024, will ensure the AI explosion in 2025 or 2026.
Until then we have to make do with great innovations via Dall-e-3, Midjourney, or RecruitAgent.ai among others, which has linked a large number of APIs and AIs and makes national and international recruitment possible in a flash. The real speed explosion of AI lies in connecting multiple APIs and AIs.
4. Job boards and socials are past their peak, but tech giants continue to dominate
Let there be no misunderstanding, a recruitment campaign in 2024 without the use of job sites or social media will not often occur. However, the lack of unemployed and active job seekers has not done any good to the effectiveness of job boards in recent years.
The global turnover growth of job boards was still ‘double digit’ in 2022 and the market leadership of Indeed and LinkedIn, in Europe, is becoming increasingly dominant. But growth will turn into a contraction in 2023 (decreasing effectiveness, fewer vacancies, price/quality is under pressure). It will eventually lead to many reorganizations at parties such as StepStone, Ziprecruiter, Indeed and LinkedIn. Due to the tightness on the labour market, candidates need fewer sources and fewer applications to find jobs. This leads to pressure on turnover for these parties.
The costs for employers are rising rapidly because of ‘ghosting’ and fake applicants are increasing.
In the total sum of the recruitment mix you still cannot do without job boards and social media, especially compared to other sources such as agencies. But it didn’t get any more fun in 2023. The costs for employers are rising rapidly because of ‘ghosting’ and fake applicants are increasing. Quality and effectiveness are therefore under great pressure in these channels, and the time investment of recruiters per hire is exploding. The productivity of a recruiter is down and costs are up, which puts pressure on the business model of recruitment.
Recruiters all over the world complain a lot about LinkedIn’s stranglehold contracts, declining service and effectiveness, and inaccessibility of tech giants such as Google and Meta.
However, saying goodbye in 2024 will not yet be an option, but this is my advice:
- No longer entering into long-term contracts (never longer than 1 year)
- Fake applicants / measuring ghosting and requesting refunds
- Share dissatisfaction more widely
- Keeping an eye on Google for Jobs (new developments have been announced)
In 2024, your recruitment strategy should at least include a scenario to recruit without the big tech giants. It shifts the sourcing strategy to referral, campus, employer branding, open days, alumni and all ‘human contact’ recruitment instead of tech. It could well be that this, together with e-commerce technology (see point 7), forms the basis for the winning recruitment strategy of the future.
5. Employers cannot get away from LinkedIn, but talent and women is!
LinkedIn will remain very relevant in recruitment this 2024, as well as the years to come. We can’t say goodbye to the job board and social media platform just yet, because contractual obligations of several years have been concluded with LinkedIn, and this takes a significant bite out of the recruitment budget. Also it takes time to create an alternative recruitment approach.
Even for a recruitment leader like you, it won’t be possible to completely leave LinkedIn or scale down.
For the time being, employers and recruitment teams will continue to identify LinkedIn as the most important recruitment tool and this is not without reason.
Candidates increasingly prefer to be approached instead of searching themselves. While LinkedIn claims to have a billion users in 2023, in addition to the many inactive, dead and fake accounts, they are increasingly men. Two-thirds of the profiles are currently from men and this number is increasing now that women are increasingly leaving LinkedIn.
The professional network is more and more being used for political and non-professional purposes, with 9 in 10 women affirming to be harassed ‘romantically’ and/or ‘inappropriately’. A major reason for women leaving the network.
Men being overrepresented on LinkedIn has to do the platform having a primarily high educated (white collar) platform with a strong emphasis on science education/white collar professions and less on humanities/care/social. Men are more represented in these professions and education levels. But as LinkedIn is used in different ways, women are becoming less accessible to Inmails and messages from recruiters. For companies that attach great importance to D&I, it is certainly something to take into account.
“20 years ago you were special if you were approached, today you are special if you were not”
Approached by recruiters
Another group that goes completely ‘crazy’ by recruiters who are approached continuously and daily, include the most sought-after IT profiles ranging from software engineer to ethnic hacker. This group is becoming more difficult to find and reach on LinkedIn, up to becoming unreachable and even leaving LinkedIn. Where the rest of the market is increasingly approached with confidence, as we will see in trend 6, we see that independent IT professionals are the first to choose not to be reachable and therefore take control on the labour market themselves.
An increasing number of people are not being approached as a result of choosing not to be reachable. Instead, they choose to work with a select group intermediairs/recruiters who take them from assignment to assignment, and employer to employer. ICT professionals have been the canary in the coal mine for 25 years when it comes to trends and developments in the labour market; with the self-employed ICT professional again leading the way. Perhaps the most important signal is not that LinkedIn has passed its (professional) peak, but that agencies and recruiters are increasingly becoming talent managers. They’ve moved from hunters to farmers.
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