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

http://www.pbs.org/newshour/businessdesk/2013/04/ask-the-headhunter-the-talent.html

by vellum • 13 years ago

68 62 13 years ago

nasalgoat• 13 years ago

I'm sorry, but the talent shortage is a real thing.

We don't have any HR filtering in place - resumes come directly to managers - but we still have a really difficult time filling our open positions.

droithomme• 13 years ago

If you want this claim of yours honestly evaluated, state your company, location, job requirements, and how much the compensation package is.

lightup88• 13 years ago

Absolutely it is. Furthermore, the concept that an applicant should dictate whether he/she speaks to a manager is impractical. Just as dismissing screeners as largely incompetent is silly.

To be clear-he's absolutely correct that automated screening of applications isn't up to snuff.

vonmoltke• 13 years ago

Counter anecdote:

We don't really have an HR department at all, and we don't have much trouble finding people when we need them. Sure, we get our fair share of chaff like everyone else. Still only takes a month or two to find someone worth hiring. I do not consider that an unreasonable amount of time. For the record, every engineer we have hired since I started, and including me, has been a cold application off a web posting.

ditonal3• 13 years ago

*Shortage of talent at the price you are willing to pay.

There are all sorts of legal work and questions I would love to have done if I could get a top-notch lawyer for $10/hr. That doesn't mean there is a shortage of top-notch lawyers, it means that I am priced out by the rest of the market who are offering them better wages. Sounds like you are priced out of the market, if you offer market wages, you will find people by definition of market wage i.e. the price that it costs to successfully hire people, not the price off of salary.com.

hkmurakami2• 13 years ago

One caveat is that "market wages" most likely will need to offer a risk premium depending on what kind of environment, stability, convenience, etc. you offer. It probably isn't going to be "the industry average for all companies (including the big boys) is $X, so I should need to just offer $X". X could be lower or higher, depending on who you manage to find and who you are.

jjtheblunt• 13 years ago

If you're in California, it's because no American from outside California improves her/his economic outlook by coming to California, where cost of living is easily several times higher than in many other thriving parts of the country.

scarmig• 13 years ago

Moving to California from the East Coast nearly doubled my salary. Cost of living went up, but by around a factor of 15-20%.

Of course, since lots of people are really fucking rich in the Bay Area, it's easy to get caught in the conspicuous consumption game (the biggest part of which is probably housing and location). But if you can avoid that, moving to California can easily mean a whole lot more money, even with taxes + cost of living.

seanmcdirmid5• 13 years ago

> cost of living is easily several times higher than in many other thriving parts of the country.

Citation required. I doubt its even up to 2X, let alone several times higher.

polymatter• 13 years ago

Where do you advertise? How do you portray your company? Do you get involved in local meetups? Do you contribute to Open Source? Why do the employees that do decide to leave you, leave? What do they say about you? Do you know the going rate for your open positions? How do you know thats the going rate and how are you confident that that is a rate your potential candidates are likely to accept? Is there a big-brand competitor nearby that sucks up your potential candidates? Is your office hard to get to? Is there a local tech scene or is it a tech desert? Is your company in a non-sexy industry that has a common perception of being particularly boring (eg. Enterprise Java billing middleware) or evil (eg. recording industry, patent troll, oil industry)?

And thats before we get to how you are filtering resumes. It can very well be the case that there is a talent shortage in your area/domain. But I think its very hard to conclusively say so on the basis of a lack of qualified candidates flooding through every open opportunity.

confluence• 13 years ago

Reminds me of a comment I had a while ago regarding HR below. Some context - the company had been having problems with hiring good people and was trying to figure out what the problem was - because they never had the problem in the past. So they figured it was related to the HR department and they tested it as below:

---

I can't remember which company this story was from (I think it was Lotus Software).

Basically the HR team of a multi-billion dollar startup were given the anonymised resumes of the first 10-20 founding team members.

HR rejected them all. Not one founding team member was accepted even for a short interview.

Tells you something about HR doesn't it?

---

Source: https://news.ycombinator.com/item?id=4699673

Same problem as found here: https://news.ycombinator.com/item?id=5470941

verelo• 13 years ago

It does say something, but do you really want to hire founders in a mid stage company?

Founders are very different types of people, the type of people who while great at starting companies, but different people are required at different stages of a company.

chii2• 13 years ago

assuming you can tell personality from reading a résumé...

doktrin• 13 years ago

I would love to get a little more context behind this anecdote, because I have to admit it sounds almost a little too good / bad to be true.

While I have fairly limited experience with BigCo hiring, my poor resume has made it through at least a couple HR filters without any attempt on my part to do any keyword matching.

Even in the cases where HR is literally grepping the resume for certain target words, the requirements themselves aren't conjured out of thin air. Therefore, I feel some of the blame is shared by the department doing the hiring. After all, they know a filter is being applied by a team without domain knowledge and should tailor it accordingly.

wisty• 13 years ago

My google-fu isn't working, but I definitely remember hearing it from a book or interview. I think it was Microsoft, Apple, or Intel.

gnosis• 13 years ago

This anecdote might seem incredible to much of the HN community, who look upon successful founders as some sort of demigods.

But could it be conceivable that they're really nothing special?

Perhaps HR was right after all.

kalterstern• 13 years ago

But could it be conceivable that they're really nothing special?

Affable but averagely talented guys with a few rich pals, most of them.

RougeFemme4• 13 years ago

Not trying to maintain the "demigod" status of the founders, but. . .maybe they are something special - at least some of them - but not a good fit for the hiring company's culture. Or maybe they would be a good fit within the corporate culture but are a poor fit for a particular job and HR is not flexible enough - or not allowed - to say "not a good fit for this position, but may be a good fit for that position. Let's toss it over to that hiring manager."

Evbn• 13 years ago

With out a control group made up of non-HR people, this study doesn't show what you think it does.

walshemj• 13 years ago

Good article a while ago I was at a meeting to discuss the grading / job role system at BT for the Systems engineering division (where 90% of the techies are)

It was a disaster as my colleague commented the only thing they decided was the grade of the hr person who fetches the coffee and biscuits at the Industrial relations meetings with the union.

HR does have a role in making sure the rules are followed though this should be delivered as training to the actual line managers.

rizzom5000• 13 years ago

I find it disturbing that Ask the Recruiter tacitly assumes that 12 million unemployed versus 3.7 million vacant jobs implies there isn't a talent shortage.

If we have 3.7 million job openings for rocket scientists and 12 million unemployed brain surgeons, then surely we have a talent shortage, no?

joshAg• 13 years ago

This might be a purely semantic argument, but I'd say in the example you provided, you have a skill shortage, not a talent shortage. If you provided training, I'm sure you could find enough brain-surgeons willing to train to be rocket scientists. Of course, that would require you to pay for their training and allow for months of lower productivity while they come up to speed, but that's still a better situation than 3.7 million openings and 0 unemployed.

lessnonymous2• 13 years ago

The problem isn't filling the rocket scientist shortage with brain surgeon retrains. It's finding the unemployed shelf stacker who's really just 6 months of good training from being you rocket scientist. Otherwise you're just creating a shortage of brain surgeons.

It's VERY hard to find quality developers. I agree with the article that HR is a huge problem, but I'm a hiring manager and I still don't see a great deal of quality.

While it's not as extreme as shifting industry, I recently took the advice from a few HN threads I'd spoken up on and while I'm looking for a PHP developer, I didn't insist that PHP be one of the languages you already know.

Did that work? No. I still didn't get an influx of quality applicants.

I also said in the ad that I was more interested in a cover letter than a resume that shows where you've worked or gone to school, and I'm interested in your Stack Overflow or HN profile. In other words: I'd love to hire a hobbyist.

But none of the 5% of this country's unemployed applied.

Zigurd• 13 years ago

Almost every one of those vacant jobs has a offering price - a salary attached to it. so those jobs are only vacant at a price. That price may be unrealistically low.

There is almost no cost, in any negotiation, to making a lowball offer. So you have to question how many of those jobs actually exist. Just as low-ball offers in a distressed real estate market are unserious, a job that cannot be filled at an insufficient salary isn't really a job.

chii2• 13 years ago

outs interesting the reverse does not happen. why isn't there any workers posting a salary offer for doing a particular job and then companies select?

hardtke• 13 years ago

Even in a normal economy, we will have about 4 million job openings. People naturally leave their jobs for various reasons creating job openings. Similarly, even in normal economy we will have about 4 million people getting a new job each month.

tokenadult• 13 years ago

I generally agree with the suggestion that the line managers who know the work rather than whatever HR department a company has should have the lead role in hiring. The supposed rationale for an HR department is that hiring and firing are hemmed in by various laws that not everyone understands, and a capable HR person can prevent a company from doing something illegal that exposes the company to a lawsuit or criminal penalties. But most of the time, HR departments really keep companies from hiring capable workers.

Definitely learn the law, and don't do anything illegal, but help managers learn how to develop work-sample tests for hiring,

https://news.ycombinator.com/item?id=5227923

and make sure that the main focus of hiring is getting each job done right by new hires who have a capacity to grow into more responsible positions in the company over the next few years.

yuhong• 13 years ago

Of course, in the long term, these anti-discrimination laws really should change, but that is a different matter.

RougeFemme4• 13 years ago

I think HR can be useful at "managing" the talent once the hiring is complete, but agree that their involvement in the actual hiring process should be limited to compliance issues. HR can also be good at helping to identify the roots of any turnover issues. Line managers may be too close to the problem and/or too busy tending to the business to be useful in that area.

bennyg• 13 years ago

Yep. A buddy of mine and a DAMN good Android developer (and overall highly intelligent man) is not getting hired on at my job (a CS research arm of the University) because HR can't accept the fact he doesn't have a Bachelors. He's literally 2 months away from it, and his contract with Tek Systems is up in a couple weeks. It's absolutely fucking stupid.

toomuchtodo3• 13 years ago

He in the Chicago area by chance? We're hiring, and need an Android developer. We don't care about education whatsoever, just if you can do the job.

lawnchair_larry• 13 years ago

Haha, sounds like the University is insecure about the value of its own product. That's like dogfooding, in some twisted way.

amorphid• 13 years ago

Is Mr. Damn Good Android Developer single? Take his temperature and tell HR he has a Bachelor's Degree in Chemistry w/ Specialization In Mecurial Heat Transfer from the New School of Thought where he completed 98.6 units.

I'm not sure that joke actually made any sense, but it sounded good in my head. Your HR department sounds so thick skulled they might actually by it.

rayiner3• 13 years ago

I do think there is a talent shortage, but I also think tech companies could learn a few things from other industries that have figured out how to recruit at scale. E.g. at my company hiring is not done by HR. A recruiting department handles the planning and logistics, but evaluations are done by lawyers. A potential recruit will be evaluated by associates at say a cocktail reception, interviewed by an associate or sometimes a partner in a screening interview, interviewed by several associates and partners at a callback, and will be hired or not based on the judgment of a hiring committee of partners. At no point does a candidate answer to someone who hasn't been in exactly that same seat before (even the recruiting people are often lawyers who left active practice). As I understand it, finance, consulting, and accounting work the same way, even in huge organizations.

The downside of this is that it's very time-consuming, and very expensive. But you get what you pay for.

rdouble• 13 years ago

Most good startups do hire this way. At least, at first. As you mention, it's hard to scale. A handful of larger companies seem to know how to recruit at scale... Google, Apple, Palantir, Facebook, etc.

rayiner3• 13 years ago

I suppose it depends on how you define "larger." It seems to work well enough for banks with thousands of bankers and 100+ new recruits each year. But it is definitely expensive, and above all requires total organizational commitment. Recruiting becomes a substantial budget item, and very few people in the organization consider themselves "too important" to get involved with it.

tptacek• 13 years ago

I'm not sure I've ever known of a tech company that had a centralized HR department making hiring decisions. Mind you, I've worked for tech companies that had HR departments that thought they had a say in hiring, but that was a self-serving delusion on their part.

I think the tech industry, like most industries, does do hiring by having domain experts evaluate candidates. That's why hoary old books like "What Color Is Your Parachute" focus so intently on getting you to identify the real hiring managers at companies.

I definitely don't think the tech industry does hiring well. I think that's one of the huge, open, lucrative "meta-problems" in the tech industry.

rayiner3• 13 years ago

One place I worked had HR do screening interviews. It was like a resume-grep, except in person. They asked me if I knew SQL. I said no, other than the briefest exposure in class. Ultimately got hired anyway, but never came close to working on any SQL. I'm not sure we even had any SQL running anywhere in the company at the time.

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

Related Stories