The Talent Shortage Myth and Why HR Should Get Out of the Hiring Business

[Caliga]

I thought I would repost this article here since it's germane to several recent discussion topics around here:

Ask The Headhunter: The Talent Shortage Myth and Why HR Should Get Out of the Hiring Business
By Nick Corcodilos

When HR personnel are put in charge of hiring new employees, they often rely on database searches, keywords and collecting stacks and stacks of resumes. Headhunting expert Nick Corcodilos says these may not be the most effective strategies to find the right person for the job. Image by Art Glazer/Getty Images.

Nick Corcodilos started headhunting in Silicon Valley in 1979, and has answered over 30,000 questions from the Ask The Headhunter community over the past decade.

In this special Making Sense edition of Ask The Headhunter, Nick shares insider advice and contrarian methods about winning and keeping the right job, on one condition: that you, dear Making Sense reader, send Nick your questions about your personal challenges with job hunting, interviewing, networking, resumes, job boards, or salary negotiations. No guarantees -- just a promise to do his best to offer useful advice.

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Question: Throughout my career I have gotten new jobs by meeting and talking to managers who would be my bosses. Now I keep running into the human resources roadblock in companies where I'd like to talk to a manager about a job. Honestly, I just don't see the reason for silly online application forms or for "screeners" who don't understand the work I do, when companies complain they cannot find the right talent. I really don't get it.

Why do companies even have HR departments involved in hiring?

Nick Corcodilos: Good question. Better question: Should human resources (HR) be in the recruiting and hiring business? My answer is an emphatic no for two main reasons, though there are many others. First, I believe HR is qualified only to recruit and hire other HR workers. HR is not an expert in marketing, engineering, manufacturing, accounting, or any other function. HR is thus not the best manager of recruiting, candidate selection, interviewing, or hiring for any of those corporate departments.

Second, putting the critical tasks of recruiting and hiring in the hands of HR tacitly relieves departmental managers of what I believe are two of their most crucial management jobs -- finding and hiring good people.

In an article titled "The Recruiting Paradox," I offer employers three simple suggestions for improving recruiting:
•"Don't send a [human resources] clerk to do a manager's job,
•Put your managers in the game from the start, and
•Deliver value to the candidate throughout the job application process."

I think companies suffer when they subject applicants to the impersonal and bureaucratic experience of dealing with HR.

Which brings me to the third reason HR should be taken out of the recruiting and hiring business: HR has no skin in the game. It virtually doesn't matter who is recruited, processed, or hired because HR isn't held accountable. It's hardly HR's fault, but it's a rare company that rewards or blames HR for the quality of hiring. HR is typically insulated as a "necessary overhead function."

Don't get me wrong: There are some very good people working in HR, and there may be a legitimate role for HR in many companies. But HR's domination of recruiting and hiring has led to a disaster of staggering magnitude in our economy. In the middle of one of the biggest talent gluts in American history, employers complain they can't fill jobs.

According to NewsHour's latest estimate, nearly 27 million Americans are currently looking for work, either because they are unemployed or under-employed. (The U. S. Bureau of Labor Statistics [BLS] reports 12 million unemployed. I prefer the NewsHour figure because it tells us just how big the pool of available talent is.) Concurrently, BLS also reports that 3.7 million jobs are vacant.

What does HR call this 7:1 ratio of available talent to vacant jobs? It has a special term. HR departments and employers call this 7:1 edge "the great talent shortage!"

While the economy has put massive numbers of talented workers on the street, HR nonetheless complains it can't find the workers it needs. That's no surprise when HR's idea of finding talent is to resort to database searches and keyword filtering, which are disastrously inadequate methods for finding and attracting the best hires.

The typical HR process of recruiting and hiring is most generously described as "hiring who comes along" via job boards and advertisements. It's a rare (and precious) HR worker who gets up from behind the computer display to actually go find, meet, and bring home good candidates.

"The typical explanation for why HR recruiters have no time to recruit actively is that they have too many resumes to sort. This very real problem is solved easily: Stop soliciting and accepting resumes." Go recruit! (That's just one of "Seven Mistakes Internal Recruiters Make.")

I could write pages about corporate maladies that arise from employers' over-reliance on HR to recruit and hire. Instead, I'm just going to list some of the ways HR can kill any company's competitive edge by interfering with these management functions:
•
Wasting money. Last year, almost a billion dollars was sucked up by just one online "job board," Monster.com, which was reported as the "source of hires" only 1.3% of the time by employers surveyed. HR could be advocating for the personal touch in recruiting, but blows through massive recruiting budgets with little to show.

•
Hiring who comes along. Job boards and similar advertisements--the high-volume, passive recruiting tools HR relies on--yield only applicants "who come along," not those the company should be pursuing.

•
Wasting good hires. Good candidates are lost because database algorithms and keyword filters miss indicators of quality that are not captured by software. And highly qualified technical applicants are rejected because they are screened not by other technical experts, but by HR, which is too far removed from business units that need to select the best candidates.

•
Mistaking quantity for quality. HR has turned recruiting into a volume operation--the more applicants, the better. This results in impersonal, superficial reviews of candidates and quick, high-volume yes/no decisions that are prone to error.

•
Excusing unprofessional behavior. Soliciting far more applicants than HR can process properly results in unprofessional HR behavior, angry applicants and damage to corporate reputations. HR routinely suggests that the high volume of applicants it must process "explains" its rude behavior--while it expects job applicants to adhere to strict rules of professional conduct.

•
Failing to be accountable. Because HR does not report to the departments it recruits for, it tends to behave inefficiently and unaccountably with impunity. The bureaucracy grows without checks and balances, and the hiring process becomes dull, rather than honed to a true competitive edge.

•
Marginalizing professional networks. HR tends to isolate managers from the initial recruiting and screening process, further deteriorating the already weak links between managers and the professional communities they need to recruit from.

•
Bureaucratizing a strategic function. The complexity of corporate HR infrastructure encourages isolation and "siloing." Evidence of this is HR's over-emphasis of legal risks in recruiting and its administrative domination of this top-level business function.

•
Wasting time. With recruiting and hiring relegated to an often cumbersome HR process, managers cannot hire in a timely way. Good candidates are frequently lost to the competition. (HR doesn't have to deal with the consequences, but when a good sales candidate is lost to a competitor, the sales department loses twice.)

•
Killing a company's competitive edge. HR owns two competing interests, further dulling a company's competitive edge: the hiring process and legal/compliance functions. Because hiring is a strategic, competitive function, it deserves its own advocate. If business units and managers took full responsibility for recruiting and hiring (while HR handled compliance) the daily abrasion of these competing interests would strengthen a company's edge.


This situation didn't arise overnight. It crept up on business in the form of a smothering shroud of red tape. Today this HR bureaucracy is propped up by an industry of "consultants," "professionals," and "experts" who advise corporate HR departments about how to maintain their administrative hegemony over the key differentiator that defines any company--its people.

HR should get out of the recruiting and hiring business and give this strategic function back to business units and managers who design, build, manufacture, market and sell a company's products. Give recruiting and hiring back to the people who actually do the business. Who better to decide who's worth hiring? Who better to aggressively go find the people who will give the company an edge?

In the meantime, job hunters have no choice but to "Outsmart The Employment System."

Please share your thoughts below about whether HR should relinquish its recruiting and hiring functions. Have you experienced problems with HR in this regard? What do you think should be done about it? (And if you think I'm wrong, please tell me why.)

[alfred russel]

For larger companies, HR is needed in the recruiting process. If you look at most companies, the higher paying positions are overwhelmingly male and white (compared at least to the general population). If you decentralize the process, in a lawsuit you are asking to get hammered. A lawyer finds a couple cases where it seems like there might be discrimination, you then look at the makeup of the company as a whole, and you have a solid case that there is a culture of discrimination.

With HR, you get relatively comprehensive CYA. You can document how you reach out to minority groups, detailed descriptions of non racial / gender discrimination searches to identify target candidates, and then documentation of why the interview process selected the candidate to hire that it did.

[fhdz]

1) Great article. Too bad no one is listening to him.

2) His website is the absofuckinglutely ugliest thing I have seen in ages. It's the Goatse of websites.

[fhdz]

For larger companies, HR is needed in the recruiting process. If you look at most companies, the higher paying positions are overwhelmingly male and white (compared at least to the general population). If you decentralize the process, in a lawsuit you are asking to get hammered. A lawyer finds a couple cases where it seems like there might be discrimination, you then look at the makeup of the company as a whole, and you have a solid case that there is a culture of discrimination.

With HR, you get relatively comprehensive CYA. You can document how you reach out to minority groups, detailed descriptions of non racial / gender discrimination searches to identify target candidates, and then documentation of why the interview process selected the candidate to hire that it did.

The article's point still stands, though - despite all of the CYA (which is good), HR folks typically know two things - Jack and Shit - about the position for which they are hiring. The departmental manager's the one who knows the details (hopefully).  And he is absolutely correct about HR not having a single bit of skin in the game. The only thing that ever comes back to bite HR is a discrimination lawsuit - not poor sales, not people who just don't fit the departmental culture, not ineffective work styles, none of it.

[CountDeMoney]

For larger companies, HR is needed in the recruiting process. If you look at most companies, the higher paying positions are overwhelmingly male and white (compared at least to the general population). If you decentralize the process, in a lawsuit you are asking to get hammered. A lawyer finds a couple cases where it seems like there might be discrimination, you then look at the makeup of the company as a whole, and you have a solid case that there is a culture of discrimination.

With HR, you get relatively comprehensive CYA. You can document how you reach out to minority groups, detailed descriptions of non racial / gender discrimination searches to identify target candidates, and then documentation of why the interview process selected the candidate to hire that it did.

HR is nothing more than a compliance machine.  They're simply there to check off the EEOC boxes at the end of the application.
YES I AM A NON-HISPANIC WHITE MALE OF EUROPEAN DESCENT I'LL ACCEPT MY REJECTION EMAIL NOW

[alfred russel]

The article's point still stands, though - despite all of the CYA (which is good), HR folks typically know two things - Jack and Shit - about the position for which they are hiring. The departmental manager's the one who knows the details (hopefully).

I agree with what you said, but I still don't agree with the title of the article that HR should be out of the hiring business. Unless you aren't worried about getting sued.

[Caliga]

For larger companies, HR is needed in the recruiting process. If you look at most companies, the higher paying positions are overwhelmingly male and white (compared at least to the general population). If you decentralize the process, in a lawsuit you are asking to get hammered. A lawyer finds a couple cases where it seems like there might be discrimination, you then look at the makeup of the company as a whole, and you have a solid case that there is a culture of discrimination.

With HR, you get relatively comprehensive CYA. You can document how you reach out to minority groups, detailed descriptions of non racial / gender discrimination searches to identify target candidates, and then documentation of why the interview process selected the candidate to hire that it did.

It's possible to let HR be involved to the extent that they need to be, but fend them off from the extent that they want to be, though.  It's possible where I work, at least.  HR is more than happy to let us 'do their work for them' when it comes to recruiting and screening, and really one could argue (as he is) that this shouldn't be their job anyway.

[Admiral Yi]

Virtually nothing in the article about the talent shortage myth.

[DontSayBanana]

Virtually nothing in the article about the talent shortage myth.

It seems that the author's contention is that since HR wouldn't know talent if it bit them in the backside, talented people are being turned away.

Anyway, Seeds got it right.  HR is a compliance machine- by definition, they should be reviewing interviews and the application process, not conducting them.  That way, you get the combined benefit of their CYA abilities and a trained set of eyes picking out the appropriate talent for the position.

[Caliga]

Before I moved down here I had an experience that you guys will love to hear about.  I had a position open for a Crystal developer, reporting to me.  I had asked our HR rep to deal with it, in terms of posting the description (which I did write myself), recruiting, etc.  About 30 days go by and I hear nothing, so I call her.  She says "Nobody qualified for the position has applied which is why I didn't send you any resumes."  So I said "ok, I guess" and waited like 2 more weeks, and still nothing.  So I called her again and got basically the same reply, to which I said "But has anyone applied?"  She said "Oh sure, lots of unqualified people" so I asked her to send me ALL of the resumes she'd ever gotten for the position.

I spent about five minutes looking through the resumes and found a guy that was actually a close match, to the extent that he had previously had a job with the title 'Crystal Reports Writer' some place he'd worked.  I was like "ummm, why did you reject this application?" and she said "He works as an AP clerk, that's why!"  But if you actually bothered to spend more then 10 seconds looking at his resume you could tell he had lost his last IT job and most likely took the crappy AP position out of desperation, and she was too lazy to bother reading back beyond his most recent position.  So I basically did a complete end-run around her, called the guy directly, had him in for an interview the next day, and extended an offer to him a few days later as soon as his (rush) background check came back clear.  He worked for me for three years and then got a job at some think tank over at MIT, and is now down in San Diego doing some web architect stuff.

Anyway, as I mentioned elsewhere I advised our CIO last week to do a complete end-run around HR's recruiters after relating this story to him.

[Ed Anger]

HR should die a thousand deaths. I am still picking the knives out of my back.

[Legbiter]

HR should die a thousand deaths. I am still picking the knives out of my back.

But it keeps all those people with worthless degrees off the streets. 

[Valmy]

So...in her opinion somebody had to currently be working as a Crystal Developer to get a job as a Crystal Developer? 

[MadImmortalMan]

So...in her opinion somebody had to currently be working as a Crystal Developer to get a job as a Crystal Developer? 

She doesn't know what a Crystal developer is, so the easiest way for her not to make a mistake is to boil it down to that simplest and narrowest of criteria.

[Admiral Yi]

Sounds like a job in Dwarf Fortress.