A Market in Tatters

Even job recruiters are scrambling as employment in North Carolina is hammered by the pandemic.

By Cameron Snipes  – Associate Editor, Triangle Business Journal Jun 19, 2020, 7:22 am EDT

Isabelle Rocco graduated summa cum laude from N.C. State University on May 9, and was also armed with valuable internship experience.

She had just one problem: there was no job to be found.

In fact, the public relations major has been looking for full-time work since March, about the same time Covid-19 began wreaking havoc across the U.S.

Rocco said she has seen many of her friends have full-time offers retracted. Others, she said, were supposed to start work in July, but had to push their start dates to January.

Rocco, too, said she landed a summer internship in N.C. State’s admissions office, but that offer was rescinded three weeks after she accepted. 

“It’s been extremely frustrating and humbling,” Rocco said of her job search. “This is certainly a hard time to be entering the job market.”

The Covid-19 fallout has caused a hard time for many, especially workers who have been laid off or furloughed because of it. And it’s causing ripples, too, among recruiting firms looking to find new ways to help their clients – and stay relevant amidst changing times.  

The end of April saw the highest unemployment rate in more than 70 years. Between March and April, the U.S. suffered the biggest monthly increase in unemployment as tracked by the U.S. Bureau of Labor Statistics since 1948 – and misclassifications mean the rates could be even higher than reported. Even with an unexpected dip in the unemployment rate in May – which the BLS attributed to the resumption of business activities – the nation still neared Great Depression rates during the pandemic. And, as the BLS noted, the May rate should have been about 16.3 percent, three percentage points higher than initially reported. 

And as Rocco knows, North Carolina is among the states feeling the most pain.

A brutal few months

In a study released in late May, the Tar Heel State ranks No. 11 among states with the highest increase in unemployment due to the coronavirus pandemic.

The AdvisorSmith ranking is based on the increase in unemployment rate from January to April, including both unemployment data and workers who have dropped out of the labor force. According to the study, North Carolina’s unemployment rate increased 16 percent from January to April. 

The official North Carolina unemployment rate was 3.6 percent in January and rose to 12.2 percent in April. During that time, AdvisorSmith reports the state’s labor force participation rate declined by 5 percentage points, from 61 percent in January to 56 percent in April.

As of June 4, an unprecedented 40 million-plus Americans had filed for unemployment across 11 weeks – and it’s not over. A McKinsey Global Institute study from late April found that 57 million U.S. jobs were vulnerable.

Even so, some of the laid off or furloughed workers are content to settle for unemployment benefits, adding to the overall jobless number.

“The sudden volume of unemployed people drives many of the job seeker trends emerging today,” said Ryan Carfley, president of Raleigh recruiting firm Personify. “Three months ago, with the unemployment rate at historic lows, you had quite a bit of mobility. Job seekers didn’t see a significant penalty moving from one company to another. 

“But amidst the pandemic, many people lucky enough to retain their jobs are unwilling to give up the internal equity built over time with their present employer to accept the risks associated with changing jobs.” 

The silver lining among those who have seen their employment cut short is that a vast majority are temporary furloughs, slated to be hired back.

Life sciences flourishes

There has been a smattering of good economic-development news across the Triangle in recent weeks. 

Pharma giant Grifols announced it’s pumping $351 million into expanding its Clayton campus and adding 300 jobs. Biotechnology firm Grail Inc. announced its first foray into the Triangle with a $100 million investment and the prospect of nearly 400 jobs in Research Triangle Park. And medical technology company AdhereRx is planning to hire dozens of employees as it expands in Cary.

All of those announcements were made earlier this month.

There is one common denominator among those big announcements: life sciences. It’s a burgeoning sector in the Triangle and one in which the area is well-versed. So it’s no surprise many recruiters point to it as a major growth industry and one that is helping soften the blow of the pandemic locally. 

“Life sciences and some parts of health care seem to be holding up well,” said Craig Stone, president of Morrisville’s HireNetworks.

According to a report from CBRE released earlier this month, roughly 30 percent of the U.S. labor force works in industries expected to prove resilient amid the disruption caused by Covid-19 and related containment measures. And the Durham-Chapel Hill area lays claim to the highest percentage of resilient industries such as health care, government and technology (40.9 percent) in the country, the report says.

“Many of the markets with a combination of average or above-average concentrations and higher volumes of resilient industries were some of the strongest local economies going into the Covid-19 crisis,” the report says. “This may help them be more resilient over the long term.”

Kelly Feist is a beneficiary of the Triangle’s robust life sciences job market.

In April, she was hired as managing director of the Americas region of Ascom, a global health care and mobile-workflow solutions provider.

“It’s certainly an understatement when I share that it’s been a challenge to assume the top regional leadership position at a health care technology company in the midst of a pandemic,” Feist said. 

Though her new office is based in Morrisville, the pandemic has required that she start her new role remotely. Feist said remote work presents its challenges, such as not being able to meet her team in person, but adds that the virtual tools being used have made things easier for her to hit the ground running. 

Adding options

Many of the workers in the hardest-hit industries, such as hospitality, retail and transportation, are not readily equipped to enter the still warm labor pools of the life sciences, health care and technology sectors.

But recruiters are seeing job seekers pivot and learn new skills to make themselves more marketable for those positions. 

“Like every other economic crisis we’ve experienced, we see people returning to school or looking at areas to re-skill in an attempt to change industries,” Carfley said.

For those job seekers willing to change careers, this pandemic provides a unique opportunity to develop specialized skills that are currently sought after.

“There’s no way to mask the truth that the current employment landscape is extremely challenging,” said Rod Frankel, president of Raleigh-based Frankel Staffing Partners. “If we search thoroughly for a bright spot, it would be that certain specialized skills are still needed and employers are ready to offer positions to candidates who possess those skills.

“Some of those industries include health care, banking, finance, delivery drivers and life sciences – particularly those firms working on vaccines, tests and protective equipment.”

Flexibility is one of the biggest keys in the current employment landscape, recruiters say, both on the part of the job seeker and the employer.

“One thing this pandemic highlighted was the need and desire for flexibility,” said Gary Greene, president of Greene Resources. “Though maybe not ideal, and certainly not without its hiccups, the transition to working remotely did happen relatively quickly in this country and many companies were able to successfully adapt.

“Job seekers have taken notice and are looking for similar flexibility in future roles. This may take the form of flexible schedules, a remote work policy, or flexibility in how work is accomplished.”

Frankel said people looking for employment should be open in their job search and convey flexibility when seeking certain positions, including when determining hours and even wages. “There’s an openness to their job-search efforts,” he said. “Job seekers are definitely required to demonstrate a strong degree of flexibility with regard to wages, functions, employment terms and hours.”

Being flexible and catering to certain hot job pockets of growth is beneficial to recruiting firms as well.

Recruiters scramble

Frankel said his secret to staying busy has been maintaining a wide variety of clients, adding that his 19-person firm has not had to downsize, furlough or lay off any employees due to the pandemic.

“Our client base has always consisted of a large number of businesses from a wide variety of industries,” Frankel said. “Obviously, our strength in the life sciences arena has also helped us as many of our clients are deeply involved in finding cures, tests and vaccines for Covid-19.”

Brian Soper, president of KSB Consulting in Winston-Salem and Raleigh, said his firm’s focus on the banking industry has, for the most part, insulated his firm from the Covid-19 fallout with Paycheck Protection Program loans to dole out.

However, he notes that the current situation presents an entirely new set of circumstances that could dampen the outlook for months to come. “It is a different climate, and there is a lot of volatility and uneasiness in the market, so my guess is it will be bumpy the rest of this year,” Soper adds.

Also, in the same way job seekers have had to adjust to the virtual world during this pandemic, including online networking and interviews, the survival of recruiting firms is dependent on how they can adapt to those changes.

“Talk about a cultural shift,” Carfley of Personify said. “No one we work with has been unaffected by Covid-19.”

Carfley said that since the pandemic hit, the firm has also implemented virtual career fairs, a first for the firm.

“We’ve done 10-plus of these in various parts of the country to access various labor markets,” he said. Personify has a nationwide scope and employs 115 people overall, including 85 in Raleigh.

Diversity and inclusion

Another topic that is on the forefront of many minds is the issue of diversity and inclusion. Local recruiting firms say they are fielding more questions regarding the issue in the past few years – and many expect that number to grow.

“We have definitely been approached by clients over the last few years to be more intentional about racial diversity; we expect this trend to accelerate significantly given recent events,” said Stone of HireNetworks. “As a firm, we place a significant emphasis on recruiting qualified minority candidates. Our clients understand the value in diversity of people and ideas.”

An example can be found at Relias, a health care education company in Morrisville. It recently released a statement of commitment to drive change in support of racial equity.

Among its intents are ensuring equitable compensation for employees of color, increasing the number of black employees and investing in black entrepreneurship and black-owned businesses.

“At Relias, we realize that racial inequities are a barrier to achieving our mission of measurably improving the lives of the most vulnerable members of society and the people that care for them,” CEO Kay Krafft said. “The events over the last few weeks have driven us to further articulate our commitment to building a diverse and inclusive way of life where we work and in our community.”

“Increasingly over the last few years, more and more RFPs (requests for proposals) include questions related to diversity and inclusion,” Carfley said. “And in the last year, I don’t think any RFPs landed on my desk that didn’t ask for help and support with D&I objectives and activities.”

For recent graduates, though, it’s a tough time to be spilling into the job market. N.C. State’s Rocco is working part-time at a boutique retail shop near her family home in Charlotte to hone her skills and make some money. 

But she said she still spends four to five hours a day searching and applying for full-time jobs.  “I did not expect the job search to be this hard,” Rocco said, “but I certainly understand why the process has been so slow.”

Snipes, Cameron. “A Market in Tatters.” Bizjournals.com, 2020, www.bizjournals.com/triangle/news/2020/06/19/job-recruiters-raleigh-durham-scramble-in-pandemic.html?b=1592565730%5E21688937.