With the threat of a recession looming, many prospective and current job candidates are concerned about how shifting economic conditions impact their access to opportunities. While a recession would undeniably have an effect, it’s critical to keep in mind that every recession is different.
Most experts believe that a recession in 2023 wouldn’t be as severe as the one that occurred during the 2008 financial crisis. Additionally, it likely won’t mimic the pandemic experience. However, even if that’s the case, candidates should prepare for what’s potentially on the horizon. Here’s a look at how a recession in 2023 could impact job candidates.
How a Recession Could Impact Job Candidates
Generally speaking, recessions are typically coupled with job losses. As company revenues decline, hiring slows. Some employers institute hiring freezes, while others are simply more selective regarding the candidates they pursue or the positions they fill.
If a recession is notable, layoffs occur. Companies reduce their workforces as a means of lower costs and compensating for declining demand. Alternative forms of hiring – such as temporary or contract positions – potentially become a bigger part of strategic hiring strategies, altering the types of roles candidates can access. However, hiring was generally strong as 2022 closed, suggesting there’s a greater emphasis on right-sizing over sweeping reductions.
Unemployment has also been low. That means that mild job losses in many sectors aren’t catastrophic for candidates, particularly job seekers with in-demand skills where shortages are common. The more significant concern is any upcoming job losses potentially cascading in select industries. Recessions don’t impact every sector equally, so a job seeker’s field plays a larger role in what lies ahead of them.
Companies are also increasingly focused on workforce preservation. With a tight labor market being a large part of the picture in many industries for several years, businesses are potentially concerned that laying off top talent means they’ll struggle to replace them when economic conditions improve. For in-demand job seekers, that means more stability, even during challenging economic times.
How Candidates Can Prepare for a Recession
For those looking for a new job, quick action is usually best if a recession is possibly on the horizon. Hiring will continue slowing if indicators suggest a recession is unavoidable. Just as candidates aim to act proactively, employers are working to take steps to control costs now. As a result, hiring budgets are already declining as a precaution.
If a recession starts, hiring attitudes will shift further. Hiring reductions may become freezes, and freezes could turn into layoffs. As a result, candidates should focus on organizations that are taking steps today to remain ahead of the curve. When an organization is already right-sizing its workforce, any subsequent hiring typically represents known long-term needs. As a result, there may be additional job security at companies that are working to hire strategically over those who aren’t using a proactive strategy.
If you’re interested in finding a new position before a recession strikes, TempStaff can help. Contact us to learn more about our openings and see how our services can accelerate your job search today.