I was prompted to look at this subject by a network colleague of mine, Simon Burns. He posted a question on the subject on LinkedIn recently. Simon asked the question to HR Managers, Hiring Managers and Recruiters alike - in a straightforward choice, would they recruit a person who had been in permanent employment over one who was a contractor or interim?
The answers were varied but there were some recruiters who showed some ignorance by saying that they would not even put contractors or interims forward for permanent positions. Meanwhile most towed the politically correct line and said 'The best person for the job'.
It did not answer the real tack of Simon's question - all things being equal, who would you hire if it came down to the last criteria - permanent or contractor/interim? I don't think Simon was being disingenuous; he was definitely trying to get some insight into what people thought on the subject, being a technical recruiter.
Perhaps an extension to the question would be to add in the currently unemployed into the equation - would the same group of people questioned prefer to employ people from the pool of currently employed staff rather than those who are currently unemployed? And at what point would they consider unemployed people to be less attractive - out of work for one, two, three etc months etc?
Recruiting In A Recession
I recently spent a little time with Dermot Hill, MD of Intramezzo the recruiting boutique company, who made a very interesting point.
'In a recession, it is those people with more experience who will be viewed more valuably to organisations.'
I would like to agree with that to some extent although I always believe that raw talent needs to be valued very highly, regardless of experience. But it does come back to a theme of mine - the cost of bad recruitment. In good times, HR people and hiring managers get very sloppy in terms of just filling open headcounts with warm bodies and to heck if they fail as there is always a fluid market of potential candidates. There is no penalty for failure and so if someone either leaves of their own accord or is fired for non-performance, there is no repercussion to HR or the hiring manager as this is just seen as 'business'. The reality is that such decisions are costing the company money in terms of excess recruiting fees, time taken to go through the hiring and re-hiring processes, time and cost of training, salary costs, the exit costs, and then the opportunity loss of what a really good candidate could have done in place of the failed one.
I would like to think that Dermot has a point that companies will pause and think about each new recruit in tougher times. But I don't think this reflects reality as the same HR and Hiring Managers prevail - there is no penalty for bad recruiting and generally if they regularly go through the process with the wrong criteria, they will still use it during a recession.
So we get back to the natural prejudices in the recruitment process. When I recruited regularly, I was always suspicious of those people who had hopped jobs with less than two or so years tenure in each. It begged the question of such characters, could they actually have been successful in such short terms and so do all the things their CVs say stack up as a consequence? Also, it probably shows that at the first sign of bad news, they jump ship or it takes on average two years to find out they are poor performers. It's a school of thought and typically it helps focus my questions and gauge the answers more thoroughly.
So mentally, I should be wary of contractors and interims, and even more wary of the unemployed, especially of the long term unemployed. Or should I?
The Benefits of An Open Mind
Dermot Hill's comments ring true. Companies should be far more wary about recruiting in a recession and they should be varying their criteria to ensure they get the best bang for their buck and long term benefit for the company. The cost of bad recruitment in a recession is exacerbated.
I believe recruiters, hiring managers and HR executives are missing a trick if they use the same criteria in tougher times as the market is now rich with experience and talent, particularly those who have been victim of poor planning and management inertia in the face of the recession and its effects.
So here are some of my arguments why Contractors, Interims and Unemployed people may actually be good bets vs. Permanently employed people for permanent positions.
1) Interims and contractors by their very nature are taken on to do specific tasks.
They are more focused on goals as a consequence, as their recent career will have been all about achieving certain tasks in certain times as their livelihood is directly at risk. For this reason, they are more determined and motivated by short term tasks and goals and so go about them with better organisational skills and planning leading to better execution of the plans.
2) Interims and contractors are more acclimatised to change around them.
For them, each new assignment represents a new opportunity not a threat and because they are more focused on goals they knuckle down quicker.
3) Interims and contractors are more used to 'hard living'.
Often when assignments finish, there is no time to relax as the task of getting a new assignment means life is a constant process of achieving assignments and then prospecting new. There is no time to settle into a status quo or easy life - it is very much a hand to mouth existence.
4) Interims and contractors do not do 'office politics'.
They come with less baggage and avoid getting involved in politics as this is alien to the way they work. They are more focused on getting the task done than making sure they are liked or progress.
5) Interims and contractors have a wider range of experience and are more adaptable.
Each assignment tends to be different which means they have to be quicker to adapt to get the goals achieved. While they often start assignments without specific experience, they have a long track record of getting into a task quickly, applying their own skills and experience and focusing on the goals. They adapt quicker to change and do not fear it, they have less expectations of niceties from the organisation - they just get on and do things.
6) Unemployed people are more hungry to deliver.
There is no worse thing financially than to have your regular income stopped or reduced. However much of a cushion of savings you may have, it will get quickly consumed and the motivation to work gets higher as the cushion gets less. People who have been out of work for a while will be desperate to prove themselves and get back onto the career track. They will be less arrogant and more eager to deliver because of it.
7) In general, interims, contractors and unemployed people will cost loss.
In a recession, it would be good to be more careful and flexible by having an option to 'try before you buy'. Interims, contractors and unemployed people would be far more willing to do this - not for free as some firms offer which is derisory, but on a contract which gives both parties flexibility. If all goes well, convert it to a full contract. This may be even a part time working contract and so costs can be contained.
8) References are harder earned
Employed people may have a reference from a company they worked at for a few years. Interims, Contractors and unemployed people may well have several references where they had to achieve something specific in order to get one. Remember for an interim or contractor, there is no obligation to give a reference in the same way as an employed person does - each is a customer reference and is so very valuable. It usually means you can contact specific people directly to get a clear, honest picture as you would a customer.
9) Unemployed people will generally be more loyal
People who get burnt tend not to stick their hands in flames a second time. Unemployed candidates will be very determined to rise to the challenge quickly and make sure they make a good impression. They will be loyal and hard working in order to maintain their position and will be more humble and thankful in the process.
10) Flexibility on starting
Of course, employed people are often encumbered by notice periods and covenants - the raft of non-regulars rarely have such baggage and can start as soon as the ink dries on the contract or sooner with no problems with former employers.
These are 10 good reasons why interims, contractors and unemployed people today make good candidates for permanent positions - there are plenty of counter arguments too. For some, contract work becomes a way of life but for others, in tougher times, the shine of flexibility wears off and the lure of a safe position is very attractive. So never pass up the opportunity to interview the non-regulars - they are an experienced, hard working, goal-focused, flexible group who will stand up against any current permanently employed person.
In fact, the above argues that they are a better bet in tough times.
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