The Effects of Market Cycles on HR Recruitment

Originally published in April 2023

Having worked in the Irish recruitment market since 2007, I have worked across various market cycles. Whilst each phase of a cycle has its own unique characteristics, we often want to understand if we are in an upward, downward, or sideward trend. I think it’s human nature that we want to look at our environment so that we can assess all options, mitigate risks, and ultimately make the right choices.

Every phase of a market cycle has unique areas of growth and retraction, but usually, there is an overriding direction on sentiment. For example, in 2008-2010 the overall market sentiment was extremely negative, even though there was growth in large MNCs that were establishing shared service centers at the time. The point I am trying to make is that there is usually a herd mentality with the majority moving in the same way.

In my 15+ years working as a recruiter, I have never seen such a split opinion on the market direction. We all naturally shape our views based on our own experiences, and with the markets becoming so segmented, I think this is what is creating such split opinions.

I’m very fortunate that as a HR recruiter, I am at the coalface of the market which helps me capture opinion and sentiment across multiple sectors. I’m also in close contact with my industry peers, colleagues, and ex-colleagues across the recruitment industry here in Ireland.

Here’s what happening:

The tech implosion has spread further, with the majority of the sector now affected by lay-offs. Tech workforce engagement is declining, those who retained their jobs are not happy with how their colleagues were treated and are also feeling insecure about their job security. 

As a result, there are large amounts of new candidates coming to the market. However, the jobs market is not aligned to this profile of candidate so we will most likely see disengaged workers stay put, simply because of the lack of opportunity to move. 

Does this all sound familiar? It should, because this was the exact trend that happened across many other industries during 2019-2021. 

I think there has been a solid level of consistency in Professional & Financial Services, Public Sectors, Life-Science, and Pharma. 

I’m increasingly seeing the volume of jobs in the market shift more towards traditional industries such as construction, manufacturing, food processing, transport, distribution, retail, fast-moving consumer goods. The HR turnover in these industries tends to be quite high so many of the roles on the market are due to the replacement of leavers. 

You might have also noticed the demand for candidates with extensive experience in Employee & Industrial Relations, including WRC and Trade Union Relations etc, this is due to these industries becoming more prominent in the market.

Job volume in many specialists’ areas such as Talent Acquisition, Learning & Development, Engagement, Internal Communications, Rewards, etc has been in decline. The volume is predominantly in core HR roles such as HR Administrators, HR Generalists, and HR Business Partners. Again, I think this is reflective of the industries hiring right now.

A lot of my clients seem to be focusing on operational improvements, whether that’s policy and procedure-related, implementing a new HRIS, or in many cases redefining the roles within the function. There was a point that the market impacts of 2019-2021 had everybody distracted and paying too much attention to the outside, with the focus now shifting inwards again. For any new hires, companies want to know they are adding value to the department, and plugging any skills gaps they might have. Bums on seats for the sake of numbers is in the past. 

One last word on the hot topic of remote and hybrid working.

More CEOs are planning a ‘return to office’, and more companies are hiring candidates within a closer radius to their offices, preparing for an increased requirement of office presence. 

This trend has hit remote workers hard, workers from around the country have benefited greatly from more flexible working with a heavy emphasis on remote working, and whilst hybrid working will remain for the future, the common practice will be three days onsite. 

Hybrid working has still extended geographical reach for companies, but with the shift towards three days per week, this excludes candidates based in Munster, Connaught, and Ulster from the Dublin market. Companies that have a two-day onsite model still have a preference for Leinster-based candidates in preparation for an eventual shift.

As always, these are my opinions based on what I am hearing.