As we begin the new year, I would like to take a moment to point out a number of changes we are seeing in the job market for the quantitative professional. First and foremost, the specific talents of skilled professionals in analytical fields are in high demand. Here are some of the trends we expect to continue over the next year:
· Talent Shortage – The job market continues to expand at a rapid pace for the quantitative professional. Despite recent reports highlighting a slowing of the economy (some even using the term “recession”), our experience has been quite the opposite. We speak to many clients who call to express their frustration at retaining and recruiting talent. The looming talent shortage in the overall employment market is exacerbated in our specialty niche. While cost per hire had been the focus of many human resource departments over the last three years, this has changed in the last six months. The emphasis is now on quality and urgency. Additionally, I have read that there is a major push to reinvigorate hiring managers to take ownership of the hiring process as strong candidates become more challenging to recruit.
Though corporate recruiters continue to use job boards and internal databases, our hiring managers now understand that this is not the primary source for the best talent. Traditional one-on-one networking and recruiter connections are usually the most effective for identifying the cream of the crop in the hidden candidate pool – something job boards simply cannot do. Job seekers have become more web savvy with the expanded use of personal blogs, websites and social networking. Consequently, recruiters and hiring managers need to keep up to date, leveraging these Internet tools to provide fresh information.
· Distributed Work – The increasingly competitive job market is causing a reemergence of the off-site-worker trend we saw in 1999 – 2000. Additionally, industry has embraced virtual meetings, web conferencing, webinars and inexpensive telephony. This distancing of some workers from the traditional workplace has resulted in an interesting, and perhaps unexpected, trend: some candidates have expressed skepticism as to whether this is the best situation for career development. Organizations moving again toward this model should consider how to battle the perception of limited career growth for the off-site worker.
Also, the offshoring of quantitative work has matured. As I have mentioned in the past, much of the migration of jobs in our profession was not driven strictly by cost considerations, but was rather a direct result of scarce local talent. The pendulum is swinging back toward training and development here in the US, as the limitations and lack of significant cost savings of offshoring this sort of sophisticated quantitative knowledge is understood more clearly.
· Rapid Technology Development – New technology has created a race among employers to provide their teams with the best equipment and resources. This is a big factor in businesses maintaining a competitive edge in their industry and keeps them from becoming vulnerable to loss of market share. I have found that professionals in analytical careers are motivated and excited by the advanced technology tools they are able to apply to their work. The ability to provide cutting-edge software tools and technology, as well as encouraging and supporting ongoing training, accords a distinct advantage to hiring managers in this tight labor market.
· Compensation Trends – I expect that going into 2007, employers will continue to become more aggressive in their recruitment efforts with higher offers for the top talent. Additionally, the use of sign on bonuses as an incentive to close deals has become commonplace. Because the demand for the best candidates has become overheated, it is important for hiring authorities to be clear on their hiring needs and tighten the search process. This will help avoid an elongated search resulting from candidates lost to competing offers and forcing the employer to repeat the entire process. The saying “the early bird gets the worm” is clearly at work in the hiring world today.
One idea for hiring managers in this challenging market is to consider bringing on candidates coming out of Masters programs who have had a relevant internship. Candidates who require an H-1 visa transfer or an OPT are almost universally accepted now for consideration (although the candidate who requires a new H-1 continues to have problems, due to government immigration ceilings).
· Relocation Challenges in a Slow Housing Market – As housing markets have slowed in the last three quarters, many of our candidates who are homeowners have hesitated to relocate. Concern about selling a home has prevented many a deal from going through, unless the employer offers a relocation package with a home purchase backup option. An extended temporary housing allowance (six months or more) can also help candidates feel comfortable with the prospect of relocation.
As you can see, we expect 2007 to present a challenging hiring environment. We look forward to working with you to find the best, most qualified candidates to meet your hiring needs. As always, feel free to call with comments or questions. Finally, in the next several weeks we will offer a detailed discussion of salary trends. Stay tuned.