Interview with Peter Alcide, President and CEO of Lee Hecht Harrison

Helene Cavalli Blog

More & More Companies Hiring and Firing at the Same Time

Translation of interview with Peter Alcide, President and CEO of Lee Hecht Harrison, by Anita Blaszczak, originally published in RZECZPOSPOLITA, August 3, 2016

RP: In Poland, as in most developed countries, unemployment is falling as the economic situation in the labor market is improving. How has this affected outplacement services?

PA: In recent years we have observed a change in the way our company performs in relation to the broader economy. Typically, we grew when the economy was struggling. However, in the past few years we’ve noticed that this is changing. Our business is more consistent and less dependant on economic downturns.

We think this is due to some serious and profound transformations in the labor market. These changes do not originate from the economic situation but from the demand for particular skills and talents.

Companies that are doing quite well financially are constantly looking for people with a set of skills completely different from the ones their current employees have. They are looking to grow, and to restructure and recruit a workforce with new skills. We observe this phenomenon in almost every sector, including IT, pharmaceuticals and financial services.

For instance, one large IT company has recently begun a major restructuring of a 10,000-employee sales department, because their customers prefer to perform most of their orders online. The company still needs salespeople, but instead of products, they must be able to sell advanced solutions. As a result, 15,000 vacancies have been created. And the people they need to fill those openings require a completely different set of skills; only 15% of the current salespeople are equipped for this new reality, and it’s proving difficult to find new employees on the open market.

RP: When did you first notice this trend?

PA: It really began two or three years ago, following the global financial crisis. Historically, after a crisis we would see a wave of downsizing followed by an increase in recruitment as the economy slowly recovered. However, after the last crisis, many companies found that it wasn't easy to find the right candidates with the required skills. Currently, almost all of our clients are going through a restructuring of their workforce – laying employees off on one hand and hiring on the other. Geographically, this process is happening on a wide scale in U.S. and Europe.

RP: What does this trend mean for employees? 

PA: From the employee's point of view, this trend has its pros and cons. There is definitely less stability, which is a negative. On the other hand, there will be more opportunities for people who are ready to invest in themselves to acquire new skills. Companies are also ready to invest in their employees, especially those who want to develop. Investments in employee development are not treated as an additional cost anymore, to be cut when the economy is depressed.

RP: What other emerging trends do you see in the labor market?

PA: I think new technologies, including social media, will grow in significance. Their role in recruitment - including management recruitment - will become more important, as companies more actively looking for candidates. Employers are no longer limiting themselves to publishing vacancies and passively waiting for responses.

We also see more importance being attached to the recruitment process itself. More and more time is spent assessing the candidate's personality to see if they are the right fit for the organization's culture, and whether they will blend quickly into a team. Previously, more attention was paid to checking qualifications and professional experience, which social media makes easier today. This emphasis on "cultural fit" makes the recruitment processes longer rather than shorter. Candidates used to go through two or three interviews; now, they have five or six. Companies want to make sure that multiple team members approve candidates.

RP: Does this mean that personality-related ‘’soft skills’’ will grow in importance?

That is definitely the case in managerial roles. Traditionally, being promoted to a higher position used to be a reward for an employee's good performance. As a result, many companies have managers who excelled in their field, but who don't know how to manage people. Now companies are aware that employee development is very dependent on collaboration with their direct supervisor and the team, where everyone should be a coach for their colleagues.

RP: Generational change, including the impact of Millennials, is a top-of-mind issue for many companies. Is this affecting services offered by LHH?

PA: I think that, even though generational differences are visible, they are often overemphasized. Just as with older generations, Millennials want a successful professional career and are ready to work hard. However, they attach more significance to the meaning of what they do and to interesting challenges. My generation was constantly told that career is all about getting promoted, climbing the career ladder, which for a lot of people ended up in frustration. Millennials attach less importance to hierarchy and are more open to horizontal career opportunities and new challenges.

RP: Are you afraid that automation and robotics will affect services such as outplacement? After all, robots do not need support if they are made redundant.

PA: Artificial intelligence and automation will surely have a huge impact on the labor market. However I believe that, as we have seen throughout history, even if some professions are automated, many new roles will also be created, all of which will require completely new skills. That means huge changes in the labor market but also great opportunities for us to help companies develop their workforces.

RP: New technology makes it easier to reach specialists from remote corners of the world. Can this alleviate the so-called ‘war for talent?’

PA: This war is indeed happening, in fact it is escalating even though a lot of people can’t seem to find work. For example, the U.S. unemployment rate is nearly 5%, but among specialists and university graduates is less than 3%. It means that among people with less education, the true unemployment rate is much higher, 8-9%. You can clearly see that it is increasingly difficult to train the unemployed population to meet the evolving needs of employers. This is a significant social problem that will require considerable involvement of governments to evolve education systems.

We see more and more companies investing in the necessary skills. However, it is a long-term process - sending an employee to two days of training no longer suffices. An increasing number of companies realize that people’s development requires time and investment. It cannot be limited only to the times when the economic situation is good.

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