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Saturday, August 23, 2014         

NEW YORK TIMES


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Despite job vacancies, employers shy away from hiring

By CATHERINE RAMPELL

New York Times

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U.S. employers have a variety of job vacancies, piles of cash and countless well-qualified candidates. But despite a slowly improving economy, many companies remain reluctant to actually hire, stringing job applicants along for weeks or months before they make a decision.

If they ever do.

The number of job openings has increased to levels not seen since the height of the financial crisis, but vacancies are staying unfilled much longer than they used to — an average of 23 business days today compared to a low of 15 in mid-2009, according to a measure of Labor Department data by economists Steven J. Davis, Jason Faberman and John Haltiwanger.

Some have attributed the more extended process to a mismatch between the requirements of the 4 million jobs available and the skills held by many of the 12 million unemployed. That is probably true in a few high-skilled fields, like nursing or biotech, but for a large majority of positions where candidates are plentiful, the bigger problem seems to be a sort of hiring paralysis.

"There's a fear that the economy is going to go down again, so the message you get from CFOs is to be careful about hiring someone," said John Sullivan, a management professor at San Francisco State University who runs a human resources consulting business. "There's this great fear of making a mistake, of wasting money in a tight economy."

As a result, employers are bringing in large numbers of candidates for interview after interview after interview. Figures from Glassdoor.com, a site that collects information on hiring at different companies, show that the average duration of the interview process at major companies like Starbucks, General Mills and Southwest Airlines has roughly doubled since 2010.

"After they call you back after the sixth interview, there's a part of you that wants to say, ‘That's it, I'm not going back,"' said Paul Sullivan, 43, an exasperated but cheerful video editor in Washington. "But then you think, hey, maybe seven is my lucky number. And besides, if I don't go, they'll just eliminate me if something else comes up because they'll think I have an attitude problem."

Like other job seekers around the country, he has been through marathon interview sessions.

Sullivan has received eighth- and ninth-round callbacks for positions at three different companies. Two of those companies, as it turned out, ultimately decided not to hire anyone, he said; instead they put their openings "on hold" because of budget pressures.

At one company, while signing into the visitor's log for the sixth time, he was chided by the security guard.

"He thought I worked there and just kept forgetting my security badge," Sullivan said. "He couldn't believe I was actually there for another interview. I couldn't either! But then I put on a happy face, went upstairs and waited for another round of questions."

The hiring delays are part of the vicious cycle the economy has yet to escape: Jobless and financially stretched Americans are reluctant to spend, which holds back demand, which in turn frays employers' confidence that sales will firm up and justify committing to a new hire.

Job creation over the past two years has been steady but too slow to put a major dent in the backlog of unemployed workers, and the February jobs report due on Friday is expected to be equally mediocre. Uncertainty about the effect of fiscal policy in Washington is not helping expectations for the rest of the year, either.

"If you have an opening and are not sure about the economy, it's pretty cheap to wait for a month or two," said Nicholas Bloom, an economics professor at Stanford University.

But in the aggregate, those little delays, coupled with fiscal uncertainty, are stretching out the recovery process.

"It's like one of those horror movies, an economic Friday the 13th, where this recession never seems to die," he said.

Employers might be making candidates jump through so many hoops partly because so many workers have been jobless for months or years, and hiring managers want to make sure the candidates' skills are up to date, said Robert Shimer, an economics professor at the University of Chicago.

But there is also little pressure to hire right now, so long as candidates are abundant and existing staff members are afraid to refuse the extra workload created by an unfilled position. Employers can keep dragging out the hiring process until they're more confident about their business — or until they find the superstar candidate they are sure must be just over the horizon.

"They're chasing after that purple squirrel," said Roger Ahlfeld, 44, of Framingham, Mass., using a human resources industry term for an impossibly qualified job applicant.

An HR professional himself, Ahlfeld has been looking for work since August 2011 and has been frustrated to find himself the "silver medalist" for a couple of jobs after six separate rounds of interviews totaling 10-20 hours for each position, not including prep work and transportation time.

For both of those jobs, though, there still has been no gold medalist. After eight months, they remain unfilled, with the companies intermittently posting a job ad, taking it down, and then posting it again.

In addition to demanding credentials beyond what a given position traditionally requires, employers have thrown up more hurdles as screening devices.

In his job hunt during the past year, Sullivan has taken several video-editing tests, which he says he aced. But he has also been subjected to a battery of personality and psychological exams, a spelling quiz and even a math test (including a question that began, to the best of his recollection, "If John is on a train traveling from New York at 40 mph, and Susie is on a train from Boston...").

He passed the math test with a 90 percent score, he said.

"Sister Callahan would be very proud that I was able to remember math problems I learned in prep school," he said. "But what on earth does that have to do with the job I was applying for? It was like something out of ‘Seinfeld."'

For the companies themselves, economists say, the gantlets they have constructed might be wasting managers' time and company resources that could be put to better use.

Besides, there are diminishing returns to interviewing candidates so many times; a recent internal analysis at Google, a company that developed a reputation for over-interviewing even when the economy was good, showed that the optimal number of interviews for any given candidate was four. But that has not sped things up. According to user reviews on Glassdoor.com, the average Google interview process has expanded in the past two years, to 30 days from 21. Google declined to comment.

And for applicants, the expenses add up fast.

Sullivan calculates that the three positions he applied for cost him $520.36 in parking fees, two parking tickets, gas and trips to Starbucks while waiting for his interviews. (He recently switched to bringing his own coffee thermos, he says.) That tally excludes the costs of producing and mailing out his video work, dry-cleaning bills for the pressed suits he dons for each interview and thousands of dollars of fees to get certified in new video-editing programs.

Job seekers just have to hope that the investment pays off.

Jameson Cherilus, 23, counts himself as one of the lucky ones. Since graduating at the top of his 2012 class at Quinnipiac University in Connecticut, he has spent hundreds of dollars on public transit traveling from his home in Bridgeport to interview for jobs in New York. After about six weeks of interviews for an entry-level administrative position at a talent agency, he got some good news: In mid-December, he was finally offered the job.

There is just one catch.

More than two months later, he said, "They still haven't given me my start date."






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