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A year ago, a study conducted by Workvivo, an employee experience engagement app, highlighted the challenges human resources professionals had to contend with at the time. The study surveyed more than 520 HR professionals in the United States and the U.K. on burnout in the HR department. Ninety-eight percent of HR professionals self-reported that they were experiencing burnout, while 94% said they felt overwhelmed and 88% of respondents said they dreaded work.
As a result of workplace transformations, HR navigated in-office, remote and hybrid work styles. They contended with the Great Resignation, sourcing, recruiting, onboarding and retaining workers. The war for talent took its toll, as HR professionals felt undervalued and under-resourced.
Human resources professionals are, once again, experiencing stress and anxiety, but this time for a different reason. Instead of being exhausted from all the hiring, HR, talent acquisition and diversity, equity and inclusion professionals are on the chopping block. A pattern has emerged: recruiters and HR professionals are let go when companies lay off personnel and enact hiring freezes. If there isn't hiring, there is no need for this function. Relatedly, DEI teams are more quickly dismantled in the absence of a "talent war," according to Bloomberg
Recruiters are the canaries in the coal mines, as they know what will happen before anyone else. When the job market is blazing hot, headhunters are the rockstars held in high regard and relied upon to secure the best talent for their corporate clients. However, in recent months, the white-collar job market has been plagued with layoffs at several companies in various sectors.
In a challenging economic environment, the demand for recruiting services slows down. Once companies start letting go of recruiters, it's a sign that the firm will increase layoffs and enact hiring freezes.
While other areas within tech companies saw headcount reduced by 10% to 20%, companies downsized 50% of tech recruiters, according to the Wall Street Journal. This means that there are now fewer qualified headhunters actively recruiting. Protocol reported, “Tech companies that have conducted layoffs this year eliminated around half of their HR and recruiting staffers,” according to a survey from interviewing.io. A year ago, tech companies couldn’t hire enough recruiters to fill all of the open technology positions. Now, the same recruiters have become job seekers.
Meta CEO Mark Zuckerberg announced that the social media giant is reducing its headcount. “Recruiting will be disproportionately affected since we’re planning to hire fewer people next year,” Zuckerberg said in a letter to employees. Around 1,500 recruiters and human resource professionals were slated for layoffs, as part of the 10,000 headcount reduction and the elimination of 5,000 open job requisitions roles.
Elon Musk took over Twitter and quickly cut 30% of its talent acquisition team. The layoffs came after the company announced that it would be pausing hiring to cut costs. Tesla, also run by Musk, laid off recruiters. The EV carmaker’s remaining employees complained about the increased workload and pressure to stay productive, Business Insider reported.
Home rental firm Airbnb eliminated 30% of its recruiting staff. Microsoft-owned LinkedIn laid off workers in its recruiting department. Recruiting software company Gem—with over $100 million in funding and a $1.2 billion valuation— sent an email to 100 employees on the recruiting team, letting them know that they’re being let go.
Over the last number of years, tech companies aggressively hired to keep up with demand. Recruiters and HR were needed to keep the pipeline of hiring constantly moving. The situation dramatically changed when the economy was impacted by a one-two punch of runaway inflation and high interest rates that impacted the tech sector. Suddenly, hiring stopped, and the firings commenced. Many of these firms utilized contract recruiters that were not employed, but hired by third parties. It was easy to swiftly dispatch the contractors, as they didn’t have the same employment rights and protections as full-time, permanent employees.
Toward the end of last year, Apple downsized about 100 contract recruiters. Amazon commenced laying off contractor recruiters prior to its tens of thousands of corporate job cuts. Google-parent Alphabet exited external recruiters, as it slowed hiring, according to the Wall Street Journal.
As a sign of the fast-moving shift in hiring, last April, companies were advertising more than 10,000 openings for tech recruiters—twice as much as the year before. By October, the number of tech-recruiter postings plummeted to around 2,500, according to ZipRecruiter.
With fewer new hires to recruit, cost-conscious organizations are also trimming budgets for workplace programs, including diversity, leadership training and well-being. HR and recruiting roles accounted for nearly 30% of all layoffs in tech, training provider 365 Data Science found. Postings for general HR jobs declined 23% over the past year, according to Textio, a workplace software service.
To keep up with demand over the last three years and the overall aggressive hiring across the board at tech companies, businesses hired one full-time HR employee for every 69 employees last year, compared to a historical norm of one to 100, according to workplace consultant Gartner. Outplacement agency Challenger, Gray & Christmas points out that job cuts this year are the highest since the 2009 financial crisis.
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