| The Emergence of Online Recruiting |
On-line recruiting can best be described as a phenomena that has made the Internet, and the Web in particular, the world's largest recruiting ground. Candidates, those looking for a job, and employers, those looking for candidates, have embraced this on-line world in unprecedented numbers. While actual usage surveys vary considerably, one study estimated up to 50 percent of all job seekers had posted resumes to Web databases; and two-thirds of all HR recruiters use the Internet for recruiting. Underlying these and many other changes related to how jobs get found and filled are several key, and inter-related, influences that have occurred in the market over the past five years.
The most important influence has been the rapid expansion and acceptance of the Internet. In particular, the explosive growth of Web-based technologies has had a major effect on how people communicate and do business. A booming U.S. economy, especially in such areas as high tech, financial services, and telecommunications has meant an increasingly tight and highly competitive job market. In addition, more and more companies are recognizing the value of their "intellectual capital" and the relationship between skill resources and competitive advantage - the recognition that it is ultimately people that are a company's most valuable asset.
Each of these factors - technology, the U.S. job market, and the drive for a competitive edge - have in turn contributed to major changes in the way that corporations manage their human resource functions, as well as significantly change the nature of the recruitment effort.
Technology Factors
The growth and acceptance of the Internet is particularly evident in the United States. In terms of absolute number of users and project growth rates the U.S. is the dominant leader. Supporting this access and is a ratio of number of people per net server that is second only to Finland. A Nov/97 survey of Internet and on-line service usage puts 56 million adults, or 27% of the U.S. population age 16 and older as participating on-line as of the third quarter of 1997. This represented 4.9 million new users of Internet/on-line services over the previous quarter.1
Job Market and Demographic Factors
The U.S. Department of Commerce reported in Oct/97 that the IT labour shortage had gone from bad to worse. At the same time as the supply of workers continues to shrink, the Commerce department predicted that U.S. companies will require more than one million new IS workers in the next seven years. At the Jan/98 National IT Worker Shortage Convocation in Berkeley, the Information Technology Association of America released its latest figures on the number of unfilled IT positions. The total number of vacancies is now put at 345,000, with comparable shortages across regions in the U.S.2 Continuing to exacerbating this shortage is a decline - 43% between 1986 and 1994 - in the number of computer science graduates from American colleges and universities.3
The IT/IS shortage is a reflection of the steady and continued labour demand accompanying the prolonged period of U.S. economic growth. Department of Labour statistics confirm both very strong job growth in concert with a continuing decrease in supply.
In addition to demand created by an expanding U.S. economy, the labour crisis has been accentuated by such factors as increased information technology purchases by business, IT/IS requirements related to the "Year 2000" problem, and dynamic Internet growth areas such as electronic commerce and multimedia offerings. If not circumvented, the META Group estimates this workforce shortage will cost U.S. industry $500 billion in business revenue, $10 billion in business income, and $15 billion in increased compensation costs.4
Intellectual Capital and Competitive Advantage
"A company's success hinges on hiring and retaining the right people, so there is a lot of pressure to hire the right people and keep them. It goes across all organizations, and it goes well beyond IT".5
In June/97 industry analysts the META Group examined various strategies that companies, especially IT organizations, were taking in the fight for scarce staffing resources. In August/97, GartnerGroup coverage of the skills shortage questioned whether "an insane IT labor market demanded insane measures". Behind many of these concerns are very real pressures that can be directly related to an increasingly competitive, and global, marketplace. It is recognized that the emerging 21st information economy:
"...will prove very lucrative to individuals with strong technical skills and solid business (vertical or horizontal) acumen. While the drive and desire to work hard still helps, it will no longer guarantee a quality job. The problem for employers, however, is that individuals with 21st century knowledge worker (KW) skills are few, relative to the general employable population. Moreover, this deficiency exists across all geographic regions and vertical industries (especially financial services, technology, and telecommunications). This situation will worsen as organizations' ability to compete in an increasingly competitive, high-tech, and global marketplace becomes more dependent on the collective intellectual capital of its KWs."6
Whatever the factors, the skill shortage places enormous demands on businesses, and directly impacts the ability to compete. As a result, more and more attention is being placed on the recruitment and management of human resources in order to ensure the efforts and investments made result in the attraction and retention of qualified "knowledge workers".
Conclusion
On-line recruiting has emerged to meet an important business need - helping companies to find the right people with the right set of skills. Paralleling this trend is the increasing role, and recognized value, of information technology to the recruiting effort, due in large part to the growth of the Internet. While the growth rate has to this point been significant, an environment now exists whereby future growth of Web-based recruiting, in terms of size and importance, can be expected to increase exponentially.
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1 "Internet Trends Report", Worldwide Internet/Online Tracking Service, IntelliQuest Inc. (18 November 1997).
2 "IT labor emergency prompts Feds to study, fix shortage", Julia King, Computerworld (06 October 1997, News).
3 "High-Tech Industry Seeks Help in Filling Technical-Talent Void", Wall Street Journal Interactive (1997).
4 "META Group Alerts IT to Consequences of Serious Workforce Shortage", META Group Advisory (30 June 1997).
5 "The right person at the right time", PC Week (1 December 1997, v14 n50 p99(2).
6 "Strategies in the Fight for Scarce Staffing Resources", Advanced Info. Mgt. Strategies, META Group (13 June 1997, File:583).
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