A Longer Wait for That Final Offer
So you want to work here? Great! Take a number. That's right, gone are the days when companies hired workers in less time than the six hours or so it took the theglobe.com's IPO to go from $9 a share to $97. Just last fall, when the nation's unemployment rate dipped to 3.9%, a job interview seemed almost like a burdensome formality. No major felonies? Come on down!
Now, with the U.S. economic expansion taking a breather and joblessness at 4.4%, employers are changing their tune. It's no longer such a merry one, at least not for job seekers. Before, it was all about speeding things up. Now, it's all about slowing the hiring process down.
Consider the case of this 20something job candidate who was contacted by a recruiter about an analyst position at a debt-rating agency in late February. The New Jersey resident, who has an MBA from one of BusinessWeek's top-30 B-schools, first visited the company in early March to interview with four execs. Later that week, he got a call saying an offer was in the works. But that offer never came. Instead, two weeks later, he was back at the company's offices for another round of interviews -- this time with five more senior execs.
SLOWED TO A TRICKLE.
After that visit, the recruiter repeated that the company was "urgently" looking to hire someone, he says. But again, two weeks elapsed without a peep. A third visit with an HR official would be needed, he was told. Two weeks after that interview -- and nearly three months after his first contact with the company -- did it finally came through with an offer. The kicker? The $60,000 starting salary was 30% less than he had been expecting. "I've been talking to other people at the company who work in similar positions," says the candidate, who ended up taking the job. "Nobody went through anything like this."
These days, a lot of job seekers have similar stories to tell. Even though hiring has slowed to a trickle at many companies, they don't want to be caught with an empty tank once the economy recovers. So they're finding ways to keep their recruiting pipeline full without rushing to put people on their payrolls. With a little luck, they're thinking, holding off on hiring for even a few months may keep people on the hook -- but off their books -- until the economy bounces back, perhaps as early as the fourth quarter.
Putting the pavement pounders through more interviews is one way of drawing out the hiring process. The time between initial interview and job offer has increased by 50% to 100% since the recent boom ended, estimates Robert Morgan, president of the human-capital consulting group at Fort Lauderdale-based Spherion, an outplacement company hired by employers to help laid off employees find new jobs. "We're definitely seeing a more extensive interview process," says Morgan.
OUT THE WINDOW.
Partly, he adds, that's because job searching has turned from a seller's into a buyer's market. "I'm not saying that [the hiring process] is more extensive than it was before the boom. I just think that in the last 18 to 24 months, people had thrown a lot of standards out the window because of the speed with which they needed to hire." Today, Kintera Inc., a software company in San Diego, doesn't "feel as pressed because we don't hear 'I have six offers,'" says Chief Executive Harry Gruber. "It's back to normal. During the hiring craze of a year or so ago, we almost had to make people an offer before they left the premises."
This year, by contrast, Charlie Callahan, chief executive at PeopleSupport Inc., a Westwood (Calif.) company that provides customer-care services to such businesses as hotels, says he's doing only a few searches for full-time employees. Thus, job candidates are being subjected to "closer scrutiny" than they might have been just a year ago. Someone who would report directly to Callahan would now interview with at least 10 other execs at the company, he says, adding: "It's a longer cycle of interviews."
Of course, that isn't necessarily a bad thing. It increases the odds that someone who is hired will be a good fit. And a battery of interviews could also be a sign that an employer is serious about a candidate.
Whatever the case, many employers are being reasonably up-front about their motives. Like a growing number of companies, PeopleSupport is also turning to "rent-to-hire" as another way to keep talent around without having to make a full-time commitment. Callahan says about a dozen execs at the middle-management level and above in his 500-employee company are "rented" at a daily rate as contractors. If there's a mutual attraction, when the economic outlook is rosier they could be first hired, Callahan says. "We fully intend to add folks, but I'm not going to do it all at once when we are watching our cash position and our burn rate."
Other employers -- mainly consulting firms -- are asking new recruits to push back their start dates. The 150 MBAs and college grads hired by DiamondCluster International, a business strategy and technology consulting firm, must now start three to four months after their original reporting dates. In return for suffering that inconvenience, the new hires are getting a $2,000 monthly stipend, their signing bonuses in advance ($25,000 for MBAs), and relocation expenses.
"We wanted to make sure that we didn't have to rescind offers," says Jill Rupple, a DiamondCluster partner in charge of the company's global recruiting. Because of the sluggish economy and typically slow summer season, the delay in starting dates is part of a larger cost-management program at the company, which includes salary cuts for partners.
LESS THAN HONEST?
At Boston Consulting Group, new hires now have the option of taking three months of intensive language training, which would delay their start dates by the same period. Other recruits must chose from three potential start dates designed to stagger the times when they begin drawing a paycheck. "This is to do a better job of integrating a class into BCG," says a company spokesman. "The economy had everyone take a look at how we can do it better."
Still, not all companies are entirely honest in their efforts to keep prospective employees on the line. A growing number are telling job seekers that they're the top candidates when they aren't even close, says Kate Wendleton, president of the Five O'Clock Club, a national career-counseling and outplacement organization. "They feel they need to keep people interested," adds Wendleton.
Reports one job seeker, an operations and supply-chain exec in southwest Ohio who has an MBA from Northwestern's Kellogg Graduate School of Management: "A large industrial manufacturer that I've been talking to since March has been saying that I'm its only finalist. There has been no movement on the job. I know beyond a shadow of a doubt that I'm being strung along."
Stuck in the middle are executive search firms that round up candidates for companies to interview, and they say it puts them in a tough position when applicants get the runaround. "When they stretch out the interview process, what they don't always realize is that there happens to be a human being involved -- the candidate," says Jack Mohan, president of Management Recruiters International's Boston Group. "It's excruciating. We have to be the intermediary who deals with the candidate and still make the client [company] look good. They don't end up looking good."
So, what's the best way for a company to keep the bench warm when it can't say for sure when it'll add to the team? Companies ought to be honest about freezes or other situations that will hold up hiring while affirming their ongoing interest in finding new talent, says Barbara Mitchell, a principal with Millennium Group International, a human resources consulting firm in Vienna, Va.
While noting that "you can't just shut down the pipeline," Mitchell, a former HR exec at hotel-chain Marriott, says any company that lies about an employee's prospects of getting hired risks developing a bad rap. "An organization that would string you along is not the place you would want to work," she adds. Of course, as long as the unemployment rate keeps creeping up, Americans will have less choice about where they go for a paycheck.
By Eric Wahlgren in New York