Why applications are falling when redundancies are rising
The news is full of worrying statistics. Redundancies and unemployment at record levels, the economy predicted to shrink, entire industries on their knees. Amidst all this, jobs are actually increasing – not yet at levels seen a year ago but increasing all the same. In October, WaveTrackR data recorded the highest levels of job posts all year, even during the pre-Covid months. So why, with a hugely increased talent pool and jobs on the up, are applications falling? We believe it to be a combination of factors, including the extension of lockdown, seasonal trends, breaks for retraining, new business formation and sheer job search fatigue.
WaveTrackR data has shown job posting to be higher than pre-Covid 2020 levels (January to March) since the start of October. And yet, from a peak of 175% over the January-March figures in mid-October, applications have declined week on week, down to +92% in the second week of November. Of course, they are still nearly 100% over the levels seen at the beginning of the year but that is quite a drop from +175%.
The first question we have to ask is, in what industries are the majority of jobs being posted? WaveTrackR data shows IT& Internet and Education jointly posting the most, followed by Public Sector, Property and Health & Nursing – industries that are booming or stretched directly because of the pandemic. One possible reason for a dip in applications could be due to candidates pivoting from industries that remain closed, aren’t hiring or have few jobs available in order to take advantage of the rise in jobs in other industries. Many of those industries, however, require training, further skills or qualifications which puts them out of many people’s reach unless they take time out to retrain. The government ad campaign to encourage job seekers to retrain and reskill may just be beginning to take.
Entrepreneurial minds who have been made redundant might see this as an opportunity to start their own business, particularly if they have previously been considering a change or if they worked in an industry that is particularly struggling. Previous financial crises have shown us that a crisis can be an incredible impetus for innovation and many start-ups are formed during them. Indeed, start-ups can thrive in times of crisis due to their ability to adapt quickly and respond directly to changing market forces. The pandemic has also caused many to reassess what they want out of life and whether their job choices reflect their core values. Others have realised from months of remote working that it was the company perks they enjoyed and not the job itself. For some, this has been a propellant to start their own business.
There is also the seasonal downwards shift that we witness in applications every year. As seen in WavetrackR’s Annual Report, applications declined hugely in November and fell even further in December – a trend that we see most years as we all start to wind down for Christmas and thoughts turn to starting afresh in the new year. This year there will be those who, after months of searching and applying for job after job and getting nowhere, have decided to take a break and restart their job search in January. Job search fatigue is hitting many and undoubtedly taking its toll on the mental health of thousands. A break is surely very much needed.
None of these potential reasons for the dip in applications spells bad news for recruiters. The opposite, in fact. Retraining and reskilling will make candidates more qualified for jobs that desperately need to be filled, those who are taking time out to regroup will start afresh in the new year with renewed vigour and perhaps a reassessment of their career goals, and those that have started businesses might just become job creators in the future. In the meantime, jobs continue to rise above January-March figures and there remains a healthy level of candidates to apply for them.