The ups and downs of Coney Island’s Cyclone are tame compared to the job market of corporate America since the start of 2020. Low lows of March 2020; high highs of nearly all of 2021. And now there’s… this. This being an underestimated zillion hiring needs in the Tech space.
This is great! Right?!
A booming job market in much of corporate America! Opportunities for candidates across the country! Great salaries to help fulfill dreams!
So, what’s the problem?
The problem is that much of corporate America is having trouble filling open roles.
The biggest problem area I hear from new clients asking for help is that they have roles they needed filled yesterday but, despite their efforts, aren’t getting filled.
Jobs are open for months; hiring managers spend weeks interviewing just to have to start over again. And all of this is in large part due to corporations not having caught up with the current market’s supply and demand.
Which, in case you were hiding from the news these past few years (and if you were, I surely wouldn’t blame you), is a “candidate’s market.”
Let’s use our friend, Java Doe. Java graduated just under 3 years ago, with a Comp Sci degree from (enter top University here). She has experience developing at a tech company and a finance company.
Two years ago, hiring someone with said experience was easy! Attracting them in New York with a salary of $110k was, well, pretty decent!
But now, Java Doe is in HIGH demand. She’s wanted by FinTech Company A, Crypto Exchange B, Tech Startup C, Big Bank D… and META.
And to that last one, the 4 aforementioned companies sigh a collective groan.
Because Meta (or other big tech) is paying, quite almost, an arm and a leg for her right now. It wouldn’t be surprising (and this is not an exaggeration) that Java Doe, with under 3 years’ experience, will be offered a package of $250K. That’s cash comp. This is REAL CASH, and it’s a REAL OFFER for Java Doe.
How do you compete with this? How do you hire right now?
This is where the Art of Sacrifice comes in.
There are four main sacrifices you can make to avoid being stuck without good new hires:
You have a product that has attracted candidates - you’re already off to a great start!
But how do you compete against Java Doe’s $250K offer?
One answer, if you can afford it, is to pay more than in the past.
Understandably, not every company initially jumps at this option. Does it ruin your budget? Is your CFO giving pushback? How do you compensate current employees to avoid coworker comp conversations from going awry?
There’s a lot to figure out. And if you choose this option, it doesn’t mean you have to match $250K exactly. If you used to offer $150K for this role, maybe increase it to $180K, and add better benefits, vacation time, and/or LTIs/RSUs.
The upside: you’re enabling hardworking individuals to make the most out of their careers and lives. You’re evening out the playing field a bit… more trickling down from the top is a benefit to society overall, and that’s a good thing.
If you can’t increase comp, and you have in your mind that you really want to hire a Software Developer out of Goldman Sachs that went to the University of Pennsylvania… well, then you need to sacrifice something to compete– and that something could be the “nice-to-haves.”
Does your Full Stack Developer really need Vue - or is React okay? Your prospective hire has Java and Python, though you’d love it if they had C#, too - but do they really need it? Or could they pick it up? Don’t forget, your candidate from the University of Pennsylvania out of Goldman Sachs is probably a quick study. Can they learn on the job?
This sacrifice keeps the budget intact, corporate culture intact, and your team feeling good. Plus, the amount of time it will take this candidate to ramp up on languages will be shorter than the time it’ll take to find the unicorn candidate that has all the requirements and wants to take an old-market compensation.
The upside: You’re providing a space of mentorship. What better thing to do in the world than to provide someone with a career and teach them? The old proverb that teaching a man to fish is better than giving him a fish is never more apropos than here.
If you don’t have the budget, and you can’t be lax on “nice-to-haves” (you do need someone with Vue), the next option is to flex on experience/interview processes.
Maybe you prided yourself on building a team filled with Comp Sci Masters from Carnegie Mellon, all with 10+ years at other prestigious investment firms.
This year, attracting these candidates seems more elusive (cue the market comp increases and the zillion competing offers).
So, what do you do? Well, maybe, there’s a candidate that isn’t out of finance and didn’t do Comp Sci at Carnegie Mellon… but he has a degree in Math from a nice local city college, and he understands regulated industries from his 5 years at an insurance firm. And the clincher – he has all the languages you want, and he’s in your comp range!
OK, he didn’t wow you quite as much as that Ph.D. you interviewed who created his own coding language at 12 years old. But – is that level absolutely unequivocally needed for your open role? Or can this guy do the job?
This leads us to the interview process. Can you speed up your process with back-to-backs instead of spreading them out over weeks on end? Can you eliminate (or shorten) that 2-week project you used to give candidates so you don’t lose them?
The upside: What initially can look like a sacrifice of standards can be a blessing in disguise. Maybe everyone you hired before – all coming from hedge funds and certain schools - all thought the same on how to problem solve. Bringing someone in with different experiences is a boon! It opens different channels of thinking, and that’s definitely a good thing.
This is a tricky one.
Nearly every new client I speak with tells me their company offers things no other company can provide. And I love to hear that – it means these employees see their companies as the best! They like where they work! It’s a beautiful thing!
But the problem is – if so many companies are saying this – how are candidates seeing it? To the candidate, what is so different about Company A’s amazing-fintech-product when compared to Company B’s similar-but-slightly-different-amazing-fintech-product? And is Company A’s special camaraderie so different from Company B’s “coworkers who are family” motto?
Both companies have amazing products with great groups of people! So how do you offer something different?
This is where you must be super creative.
What can you offer?
Nearly every company allows for hybrid or remote now… so it can’t be that…
What can it be?
Maybe it’s a paid-for work experience abroad for a month. That could sound pretty “wow” to a prospective employee, and it shows you’re thinking about their happiness. It costs something, but it’s not nearly as expensive as increasing an offer by $50k.
Or maybe you’re involved with various tech organizations – can you give Java Doe an opportunity to speak at such conferences, ones she wouldn’t have the chance to speak at if she were to join another firm?
The upside: you’re adding value to your company. It’s no longer just about work. You’re providing opportunities and growing prospective and current employees in a variety of directions you have never gone before.
You might have noticed a sacrifice missing from my list: Changing the location of your role, moving it further away from high-salaried cities. And there’s a reason I left this one out.
With the recent remote boom, salaries for an engineer in Iowa are no longer so different from an engineer in, i.e., Los Angeles. Is there a little difference? Sure. But not nearly as much as there used to be.
And there are the long-term ramifications of moving your team to a new location: though there are talented candidates everywhere, talents do differ in different locations. Are you foregoing industry experience? Are you losing your corporate culture? If salaries nationally, even internationally, continue to rise with remote options, will this be a smart long-term plan? If your competition is building a team of the most talented engineers in NYC, and you’ve moved your entire team away from NYC, where does that leave you?
The market will change eventually, as it always does. But do you want to spend the next year, two years, and so on waiting while your competition grows infinitely beside you?
If you’re excited about hiring this year, stay ahead of the curve and learn the art of sacrifice early. The next time you cringe at your budget restrictions, the next time your boss tries to tell you they won’t budge in any way, the next time your compensation analyst innocently declares last year’s salaries are still valid this year – feel free to direct them to this article (you can play good cop, I’ll take the bad cop stance for you!).
Lauren Epstein is the Head of Technology Recruitment at the executive recruitment firm JW Michaels & Co., where she’s been since 2013. She is immersed in management consulting, staffing, strategic advising, and thought leadership within the Tech space. You can reach her at email@example.com.
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