Episode 16: Navigating the Current Talent Crisis

Transcript

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00;00;00;00 – 00;00;25;27

Hello and welcome to Change@Work, a podcast about the ever evolving world of work and the human behaviors that drive it. I’m Chris Thorton, principal here at Daggerwing Group. We’re consultants who take a slightly different approach to change and how we work with our clients.

00;00;25;29 – 00;00;47;12

We’ll explore some of the things we’ve learned, what to do, what not to do, who we are as a team and as individuals. Joining me today is Evan Sohn, chairman and CEO of Recruiter AECOM. Evan is a frequent contributor on CNBC where he shares his insights into the ever evolving labor market. Evan, thanks so much for joining us.

00;00;47;13 – 00;01;12;11

Hey, Chris, Thank you so much for having me on your show. And then tell us a little bit about yourself and tell us a little bit about recruiter AECOM. Sure. So Evan Zohn, 54 years old, happily married, almost 27 years, three children, 20 to 20 and 16. I started my first company out of NYU in 1989, NYU Business School in Mobile computing.

00;01;12;11 – 00;01;34;24

So I am old and I got mobile computing. Then someone goes, you mean like the Palm Pilot? I’m like, before the Palm Pilot. So it really had a fantastic first ten years of a career, reinventing a number of industries, leveraging mobile, specifically in the pharmaceutical sales automation industry. Then I went on to another company, venture backed grew that company.

00;01;34;24 – 00;01;58;08

We got acquired by Message Labs and the security messaging space that that got acquired by Symantec, then left, then went to another mobile company, got acquired by VeriFone in the payment space, spent about a decade in the payment space, left VeriFone after a few years, went to a company called Point Plenty out in Silicon Valley and Point got acquired about nine months ago by GoDaddy.

00;01;58;08 – 00;02;24;29

So I’ve done this a few times, but a lot of fun. At the same time. I had a brother who passed away in 1993 from cancer and his friends and I started the Irish phone conference Foundation. And so the foundation raises money for pediatric cancer. My brother was a Wall Street trader, and the conference was really became really a global sensation phenomenon, whatever you want to call it.

00;02;24;29 – 00;02;53;26

Just great work raising money for pediatric cancer and other childhood diseases. But the Hallmark event really was a financial hedge fund conference. So I always had my hand in sort of the financial world and like the tech operational side and I got involved with recruited I come a little under three years ago, brought in by one of the original investors to sort of figure out, that recruiter com really was a marketing company with a community and a newsletter and advertising and hey, what can you do with this?

00;02;53;28 – 00;03;13;01

And my, my first comment was, you have a company called Recruiter. I com the fact that it’s not worth $1,000,000,000, someone’s doing something wrong. So let’s go figure that out. And I came in first as chairman of the board and then really at the height of the pandemic became CEO. And there you go. That’s the story. I love it.

00;03;13;01 – 00;03;32;11

Thank you for that. When you think about, well, we got to listen. It’s part of the podcast. So it was like to dig in a little bit into the human side of of what you do and who you are. I think you’ve given us plenty of that. So let me just ask you a couple of questions. What was your dream job growing up?

00;03;32;13 – 00;03;49;24

Growing up like, really growing up like as a little kid, Like really grown up. Like little kid. I as a little kid, I really want to be a teacher. You know, the teacher. I had a great teacher in fourth grade who was very great reading. I had a great one in fifth grade and then in sixth grade. And I just really got motivated to do that as a little kid.

00;03;49;24 – 00;04;08;10

And then I really yeah, I was always an entrepreneur. Great little story for you. You know, I don’t follow any sports whatsoever. My my son’s first professional football game was my first professional football game. Like, you know, I yeah, I had to hire a coach to teach my son how to throw a baseball like that. That that’s okay.

00;04;08;10 – 00;04;26;29

Not bad. Yeah, that’s how I was working at a very, very young age. And when I was in elementary school, they would flip cards. Remember the old days? We would flip baseball cards. Yeah, but I didn’t know enough. So I actually had this was like first or second grade. I had two kids who were fantastic at flipping cards, and I would see them every day with cards.

00;04;27;01 – 00;04;41;08

They would go out, flip, bring me back the winnings, and I would cut them a piece. I don’t remember what it percentage wise, but I was giving out like a handful of cards, like, okay, you bought me like this stack of this stack. And, and I was sitting them. I sort of leveraged my assets and that was a lot of fun.

00;04;41;08 – 00;05;06;01

I that was probably my first my first entrepreneurial bent. Yeah. So even one of the things we wanted to discuss was the current talent crisis, how you’re seeing it from your vantage point of a recruiter. AECOM Can you walk us through at a high level the changes that the recruiting field has undergone since the start of COVID, other than at least my clients have been overwhelmed in terms of the open positions that they’ve got to go for.

00;05;06;01 – 00;05;24;27

I don’t know if that’s what you’re seeing or not. Maybe see something else. Yeah, let’s let’s let’s double click in to that because you ask a lot of questions in one question. Yeah, it’s a phenomenal question. So let’s first look at let me give you one overarching theme. Every industry has had their moment in the sun, and I’m talking about at a macro level, right?

00;05;24;28 – 00;05;51;06

We had our our telecom in the nineties, our hardware, our mobile devices, our apps, our dot com hedge funds, real estate. Every industry had their moment in the sun. I truly believe that we are now in the global age of recruiting and talent acquisition and let’s actually combine all this into talent acquisition. Talent acquisition is really first of all, it’s $120 billion industry.

00;05;51;06 – 00;06;20;19

It’s a huge giant industry, completely fragmented, which for me coming not from a recruiting industry, I’m not a recruiter, I’m the least qualified recruiter in the company. Fair really has this great opportunity to really come in there, really reinvent how people actually hire. So you asked a question about the talent pool. There is an incredibly crazy, unprecedented and I hate using that word job market today right on the on the high skilled.

00;06;20;26 – 00;06;45;10

We have an incredible talent market. Why? Because everyone is now more qualified than they were a year ago. Everyone. Right. Every candidate today. Think about that. Everyone today, from the job developer to the factory worker willing to walk into a factory is more qualified than they were a year ago. Why? The reason is that if we’re working from anywhere, right, that means I could hire from anywhere.

00;06;45;13 – 00;07;05;26

And so that developer that sat there in Des Moines, Iowa, who’s a phenomenal Java developer, was only working for companies that were in Des Moines, Iowa area. Now, a Silicon Valley company could say, wow, look, I want that Des Moines, Iowa job, a developer and that and the Des Moines, Iowa doesn’t have to move. So it’s just this crazy environment.

00;07;06;00 – 00;07;27;27

Let’s keep going there for a moment. Right. Growing up, you know your parents that you hate. Sure. Your first job, you’ve got to stay there at least two years. You just can’t leave. 40% of all millennials now, 60% have no problem leaving a job within its first year. No problem. Crazy. Yeah. Keep going. In our We do This recruiter index.

00;07;27;27 – 00;07;49;15

So we started serving our recruiters once a month and publishing the results. And that’s what I talk about on CNBC yesterday. But we started tracking candidate priorities, right? So you would expect the number one priority be money, right? And number two would be, I don’t know, a balance right now. Compensation is a 31% ranks as the highest priority.

00;07;49;17 – 00;08;10;03

That means that 69% of a candidate’s priorities are intangibles like work from home and work life balance. A great experience. Can you imagine someone saying to you, Hey, Chris, I’ll pay you less money, but it’s going to be a great experience when you’re starting out. The answer is that’s what’s happening today. That is what’s happening. And you’ll see another article about that today.

00;08;10;03 – 00;08;31;24

And what that really means, Chris, is that the candidate flow is going to be moving significantly faster. So I’ll ask you a great question. Okay. So two years ago, you saw a resume of a 30 year old has been at the same company since they graduated college two years ago. Let’s just forget the company. And I’m exaggerating to prove a point, let’s describe that candidate.

00;08;31;24 – 00;08;54;05

Give me some words that you describe how you thought about that candidate two years ago. deep expertise. That’s right. Committees. Yeah. You go loyal. Yeah, for sure. Okay. For sure. 2021 post-pandemic today you saw a résumé as someone who’s 30 years old, been at the same company for ten years. Describe them. I want to help you prove your point.

00;08;54;05 – 00;09;13;20

So I’m going to say what’s wrong? Like, did no one else want? That’s right. Risk averse. Yeah. That will require more experience, etc.. Yeah, not desirable. Somebody stuck with you. Why would I want you? Right? I agree that that. That’s not all I’m talking about. Not the edge cases, but like. Yeah, the is not you and me, Chris.

00;09;13;22 – 00;09;32;11

Right. That’s not the question. The question is if you’re a 25 year old person working at a company and you’ve been at that same company for four or five years, you’re probably saying yourself, I probably have to go because I don’t want to be that candidate that’s going to be at the same county for ten years, the same way that 20 years ago or 30 years ago.

00;09;32;13 – 00;09;47;26

Why are you at that job? Well, look, I just started last June. I got to stay at least two years. Otherwise it’s going to look like I’m a job. Half of it. Right? Right. You know, I started talking the other day. We are entering the job hopper economy and what that means. Sure. Yeah, sure. And that’s going to happen is going to be absolutely crazy.

00;09;47;26 – 00;10;07;11

Now, that’s at the high end. The talent that side at the less skilled labor side, we’re sitting there with 9 million people unemployed with 10 million job openings. Why is it, you know, is it because they’re scared of Delta? Is it child care or is it you know, they’re all these different reasons. Are they waiting to get a better deal?

00;10;07;11 – 00;10;27;25

It was a month ago McDonald’s offering $500 to, you know, for new recruits. Maybe I’ll wait till it’s $600, you know? Yeah. So there are all these dynamics that are going on that are keeping people from actually entering the marketplace. And the final thing is really, you know, we saw the job numbers today. They’re not good, right, That it’s October 8th.

00;10;27;27 – 00;10;55;03

The job numbers came out to be under 200,000. We actually talked about that yesterday on CNBC. The headwinds of driving new jobs. What most people don’t know is that there were millions of people hiring in September, millions there were 194,000 new jobs that millions of people were hired. And the reason that it’s only 194,000 and not millions is because just like what you said before, those recruiters were backfilling open positions at a company.

00;10;55;03 – 00;11;24;17

I believe it. We have clients that are losing more people than they’re hiring right now. Wow. So it sounds like a really hard time to be a recruiter. Seems like a great time to be CEO of Recruiter action, though, to help fill that need. Yeah, well, what it really means is that as a talent acquisition professional, right, you need to be thinking about how do I spend more time speaking to candidate and speaking to clients and less time sourcing for them.

00;11;24;20 – 00;11;44;25

And if you’re a company, you’ve got to be thinking about how do I augment my existing talent acquisition team? So let’s break that down for a second, okay? If you are a recruiter, right, 8020, let’s do the old 8020 rule. You’re probably spending 80% of your time finding candidates and 20% of your time talking to them, talking to candidates, clients that you can’t be doing anymore, right?

00;11;44;25 – 00;12;01;08

No, no, no. And by the way, you know, no one shows up to your door anymore to sell you a vacuum cleaner either, Right? They’ve said, we got to turn that into a, you know, an online marketing event and drive the throughput. Right. That that numerator the top number can’t be I’m going to go make 20 phone calls.

00;12;01;08 – 00;12;30;02

It has to be I’ve got to broadcast a message to a thousand people. You talked about some of the reasons of what people are looking for. Is there anything that you’re seen as the number one reason why the turnover is happening, why we’re not retaining talent? Sure. So the answer is there’s probably no one thing, right? You and I grew up in a world of either or Sony or Beta VHS, HBO, Showtime.

00;12;30;04 – 00;12;51;15

You know that if you were lucky, you know, now it’s it’s we’re in an and both world. So the answer is there are a lot of reasons. I believe that if we take it for a theory or hypothesis that Covid’s changed everything or COVID actually expedited the things that are already happening, right? So your grandfather had one job his whole life.

00;12;51;17 – 00;13;13;10

Your father might have changed careers way and you have no problem shifting every five, six years. So that number is getting smaller and smaller and smaller at the same time. The millennials now are into new experiences. You know, I was doing some research for a talk I’m giving and you looked at the Army, and the advertisements for the Army have really been interesting, right?

00;13;13;10 – 00;13;31;20

You and I grew up with, and I think I’m a little older than you, you know, not much. Uncle Sam wants you right that way. There was the old guy with the finger point that Uncle Sam wants you. You could swap that out for IBM, wants you, General Electric wants you. Right. Part of the family. We’re going to take care of you a couple of years later was be all you can be.

00;13;31;20 – 00;13;49;13

Self-Development. that’s pretty exciting. So I’m going to make you the best you can be, the best, you know, all that other stuff. I think Taj the recession probably in 2008, it was We’re going to help you get a job right, get your training through the army. You don’t know what to do. We will get you trained on electrical.

00;13;49;13 – 00;14;08;27

And then we talk about I got this great job after the Army because everybody post 2008 was worried about where am I going to get a job. You see the ads recently for the military? I joined the military and now I’m in Thailand. I joined the military. Now I’m in Germany all about this life experience. Wow. So we’re looking at this generation of people that are into experiences.

00;14;08;29 – 00;14;28;12

So now let’s couple that. This desire for experience, which bodes for our candidate sentiment through the recruiter index, would show that experience was like 60% of the candidates rank that as number one work life balance, all this other stuff. And the third is pretty incredible. When you interviewed for a job and I don’t know where you started your career.

00;14;28;13 – 00;14;48;14

Well, let’s pretend you started your career at a corporation. Where did you start? I started as a teacher. All right. So you started teacher and you were teaching. And in a school and you were dressed down every day, whatever it was, you had to go for an interview. Let’s assume you were going for an interview, right? Yeah. You walked into school wearing a suit, and the principal came over to you and said, Hey, Chris, what’s going on?

00;14;48;14 – 00;15;04;01

And you say, my and sister Don, I have to go to a funeral this afternoon, right? I spend the whole afternoon. I’m sorry, I can’t be available. I got a funeral to go to the next day. You’re getting phone calls from the headhunter or whoever the hiring manager, and you’re stepping out of the class and you’re kind of walking outside.

00;15;04;03 – 00;15;23;03

it’s my mom. She’s really sad about that funeral she went to. It’s a whole cloak and dagger thing. In fact, Chris, you’ve heard this more times where someone goes, I left my job because it’s a full time job trying to find another job, Right? It’s a full time job today. How do you interview today, Chris? It’s been a while.

00;15;23;03 – 00;15;51;02

You interview like this on a video. Got it right. No. Who doesn’t have 15 minutes to interview? Lorin could actually be interviewing right now. Producer Lauren’s on here. Lauren, are you are you on another Zoom interviewing right now? my God. No. But the reality is that who doesn’t have 15 minutes to actually take an interview Now, by the way, let’s couple this, Chris, with the fact that there’s no longer geographically undesirable positions.

00;15;51;04 – 00;16;12;13

Right. So I could have said to Lauren, the producer looked, Lauren, I got this great job, but you got to fly out to Atlanta, move to Atlanta, and Lauren’s going to go, I don’t want to. I got my dogs here. My spouse is here, my family. I’m not moving. But no one’s going to say that today because if I really want more and to work for me, I’m not going to hold her to any geographic requirements.

00;16;12;18 – 00;16;38;24

I’ll sit her. You come every other month. I don’t care. And so all of a sudden now we have this desire for new experiences. We have the ease of actually applying for jobs. I click, I interview, I’m done, and there’s no more geography. So everybody now, not only are they more valuable, but have one has all these opportunities and the the stigma of coming and leaving a job quickly, it’s gone there.

00;16;38;26 – 00;16;56;29

You’re moving into the job hot job hopper for anyone in your audience that doesn’t know was actually not a good term. You know, three years ago, a job that sort of was a bad thing. Yeah, right. If you had if you had a job at a teacher and then you did something for a year and do something afterwards, that thing in the middle, you would cut off your resume.

00;16;57;00 – 00;17;25;23

I would move some dates over a one, move some dates over the other to cover the gaps. Yep, yep, yep. You didn’t want to look like a job hopper, and now no one cares. No. Yeah. Yeah. We’re. We’re way beyond that. Beyond geography as an experience, are there other experiences that you’re seeing candidates want? Yeah, it’s a again, that’s a great question and I’ll put my, my money where my mouth is and I tell my children and others that ask, you know, this is not don’t look at this as your first job.

00;17;25;23 – 00;17;50;01

You’re looking at what skills do you want to have next? And I think that as a country, we’re going to start shifting away from sort of how long have you been working at a company to what have you gotten done, what skills have you gain and how do you get your skills? And I think that as we start worrying less about clocking in and clocking out and by the way, you can look to the Silicon Valley area for being more progressive, you have companies that are giving unlimited vacation.

00;17;50;03 – 00;18;20;22

Now, that sounds like fun, but it’s actually more responsible. Like means, crap, I really got to get my work done because they don’t really care about how much time I take. But I think we’re moving to a much more metric oriented get your work done. And it’s really the skills. So when I talk to people, it’s really about what what skill you missing to get to the next level and if your skill is, hey, you don’t have a skill in dealing with people on a face to face basis, get into an organization where they’re going to give you face to face customer experience.

00;18;20;22 – 00;18;38;25

If you want to build data analytics, go work at a company. We’re going to crunch data for the next two or three years. What’s incredible, guys, is that you don’t have to make these lifetime decisions now. It’s really. That’s right. Think about the parts, right? You and I, we’re faced with, what’s your career path? You know, this is your career year for sure.

00;18;39;00 – 00;18;57;24

And and we we were marked in awe of that person that changed. You know, that doctor, that drop being a doctor that went to the pharmaceutical. that was like a big special thing that’s going to be common. So I think the experience and getting back to that question a very long way, that answer is help me expand my skills, what do I need?

00;18;57;24 – 00;19;22;11

What skill am I missing to get to the next level? I do think the expression give it the old college try is going to be passé and it’s going to be more skills oriented because it’s not just about a college degree. Getting the skills, What do I need next? And I think, you know, the tools that we’re having, the assessment tools that we’re doing are going to help people say, Chris, you would be great for this job if only you knew how to do X.

00;19;22;18 – 00;19;39;06

So why don’t you go get X done? Then you’ll come here, you’ll get that skill and then you’ll move on because that’s okay. And I think that’s the experience that we’re talking about here. You see the open positions. Do you have any advice for organizations that are trying to retain top talent beyond just getting them in the door?

00;19;39;06 – 00;19;55;10

How do you hold on to them? Yeah, So, Chris, great question. I talk about that often with some of our interesting clients. You know, our primary client is like the global head of talent at a company, right? So either it’s the Chicago or the global head of talent, and so are so I know who you’re talking about. Keep going.

00;19;55;10 – 00;20;14;11

So my advice is a and this is really to like the the left coast companies right the Bay Area companies. Yeah embrace it embrace the fact that if I’m going to attract Chris to work on my company let me flip it and I will say to Chris Chris this is a 36 month project. I have you on for 36 months.

00;20;14;18 – 00;20;33;29

I will pay you a ridiculous amount of money for 36 months. I will give you a balloon payment at the end. I’ll make whatever you need. But I don’t want to say this is a lifetime career. This is a 36 month project and hey, when it’s done, you could do one of two things. You could leave and take all of your options and all the other things with you.

00;20;34;02 – 00;20;53;23

Or if you stay and take another project at this company, I’ll give you a 30 day vacation, a 30 day paid vacation. All of a sudden now you’re like, that’s really interesting. I started talking with another company that, you know, let’s pick up on the junior year abroad process, right? Every kid now says in college, I want to go abroad, Junior.

00;20;53;25 – 00;21;17;20

So I actually told this company, it’s a very, very large financial firm. Embrace it. You should actually have relationships with 20 of your clients around the globe and say, Hey, Chris, here’s what happens when you work for our firm. If you’re if you’re great and you look great and you stay for three years, you could do your fourth year or your fifth year, whatever that is, you can go to Abu Dhabi and work for the Abu Dhabi Sovereign fund.

00;21;17;20 – 00;21;36;00

You can go, Yeah. So create that model that says, I’m going to help you get your experience, I’m going to help you, and I’m going to keep you in my ecosystem, right? But I’m going to get you the experience that you want to have, this exciting experience. I think the other is, you know, you really got to build consistently build a bench.

00;21;36;00 – 00;21;56;04

Look at this macro level to think that you’re going to able to hold everybody is just, you know, putting your head in the sand. And my recommendation to companies is you must have a constant stream of talent coming in. You know, you would you would yell at your marketing department if they weren’t consistently driving leads, right? Go back to your school days.

00;21;56;08 – 00;22;20;07

You have a full time admissions officer to make sure there are kids coming into that school. And if you’re at a company, you don’t take your foot off the gas in terms of leads or marketing or customers coming in there. Why would you take your foot off the gas of talent? And I think there’s going to be another challenge that happens two years from now, which is all the people are getting hired now that are working in this hybrid remote environment aren’t benefiting from the mentoring that the three of us had, you know, in work.

00;22;20;07 – 00;22;40;24

And we could talk about that next time. But I think my advice really is embrace it, be create structures that work and feed into it golden handcuffs wherever you can, golden handcuffs to make sure they’re not leaving. And the fourth really is just set up a process where you’re consistent, only adding talent and build a bench, figure out where the bench is right.

00;22;40;24 – 00;23;04;05

In other words, figure out what place in your company can you always be hiring someone out of college just figure that out. And if it’s not working, get rid of them because that can be happening very, very quickly. I love those four. I think one of the things that you said earlier that I want to add on as a fifth and test with you is one of the things we talk about with our clients is have a culture where people actually want to be a part of it, right?

00;23;04;05 – 00;23;22;13

So the money goes a long way, experiences go a long way. But if it’s not a place where people actually enjoyed getting the work done, that’s one of your biggest challenges. Have you experienced that at all? Have you seen that? Look? You know, the challenge that we all face is how do you continue to create culture in a virtual environment?

00;23;22;15 – 00;23;41;20

And I think there are some companies and let’s look at what’s going on in the last two weeks, right? You had p.w see who announced that 40,000 workers work wherever you want, and they joined the list of Salesforce.com and Spotify who say, I don’t care, just go work. They’re obviously focused at keeping and hiring and retaining the best talent.

00;23;41;20 – 00;24;04;04

So if I could pay the most amount of money and let you work wherever you want, that’s really good. You have Bank of America who’s actually giving out a mandate that said you must be in the office. And if you’re not vaccinated, you know, sorry, right. They’ve optimized actually for the long term, ironically. Right. They’ve actually optimized for hey, look, it’s really important for us to have this corporate culture where people are coming into the office.

00;24;04;10 – 00;24;25;29

We’re mentoring junior people. We’re seeing people eye to eye that that’s what they’re optimizing for and they’re willing to forego the talent that would say, I must be virtual. And again, I think they’re edge cases that everyone’s dealing with, of course, etc.. But I think the theme here, Chris, is the candidates and the companies are going to have choices.

00;24;26;06 – 00;24;48;04

They’re going to have more choices. You know, we talk about work from anywhere today, a year from now, we’ll be talking about hire from anywhere. I could hire from anywhere. You got to. Yeah, yeah. And so it just opens up everything. So, by the way, we are about 75 people in the company. I have a we work office that that is, you know, for our senior team and we show up once a month.

00;24;48;06 – 00;25;07;10

That’s it. I got people all over the country. We have people all over the country outside the U.S. We get on zooms and we have a culture committee and, you know, we’re struggling like everybody else to building that culture of making things work. But, you know, it’s I would keep my head in the sand if I thought that the same people would be here less 5% in three years from now.

00;25;07;15 – 00;25;36;20

I mean, you’ve been a great guest today. Thank you so much for joining us. This has been fantastic. Please do come back. Hey, Chris, thank you so much for having me on your show. It’s been a real pleasure and love to come back and talk more when the situation arises. Yes, please. Thank you.