Monday, May 6, 2013

The American Hiring Paradigm Is Broken

By Seth Mason

Central banking has made a mess of the economy, and increasingly onerous jobs-killing federal legislation has impeded hiring and thus has impeded economic recovery. But the Fed and Washington aren't the only culprits in the nation's continued economic malaise. The American hiring paradigm is also to blame.

As a perennial job seeker, I frequently respond to job posts. I've noticed that--with the exception of small numbers of listings posted by entrepreneurs--listings by American companies almost always outline desired amounts of applicant experience as opposed to what's far more important: congruence with company goals. Lou Adler, entrepreneur and best-selling author, best summarized this phenomenon in an article he recently published on LinkedIn:

“Successful candidate will develop a new approach for reducing water usage by 50%,” is a lot better than saying “Must have 5-10 years of environmental engineering background including 3-5 years of wastewater management."
Indeed. Before the economy crashed, I was able to grow a local Spanish-language newspaper into a Spanish-language entertainment magazine published throughout 2 states. My company enjoyed such robust growth primarily because I staffed it with great people who contributed to specific company goals. I found these great employees not by seeking applicants with X years of experience, but rather by seeking applicants who made the best case that they could contribute to the objectives I outlined.

As both an employer and a job-seeker, I can say with certainty that the common American approach to talent acquisition--valuing years of experience over capability--creates tremendous opportunity costs for the company, and therefore retards economic recovery. (This is evidenced by the automatic rejection of the long-term unemployed.) This unfortunate approach to hiring is almost certainly a function of the increasing trend of management delegating the all-important task of staffing to people who are not only far disconnected from the development of company goals, but aren't businesspeople at all. These people--call them recruiters or HR professionals or whatever you wish--use years of experience as a baseline for applicant value because they have little frame of reference as to who could best contribute to company goals. And they can never have this frame of reference because 1) they aren't part of the company goal-setting process and, 2) even if they were included in such discussions, they often lack the unique attributes and personality of a business leader. As Adler puts it, "only a thinker can determine what to look for in a thinker."

The solution to this problem is simple: American company leaders should play a greater part in the hiring process. This begins with creating jobs listings outlining specific company goals and ends with taking the lead in determining which applicant(s) could best contribute to achieving said goals.

Obviously, company leaders can't be tasked with filling low-level positions. But when it comes to filling positions that directly affect the company's bottom line, they should absolutely take charge.

The above originally appeared at Ecominoes and is reprinted here with permission.

NOTE: Mason has a very important point here. However, it goes even deeper. Government regulations are  making it more and more difficult for new firms to start-up and difficult for them to take on new employees (especially with Obamacare coming) if they can get off the ground in the first place. It's the new firms that are most willing to hire someone who might  not have the perfect resume, but appears like a good risk. These kinds of firms are fewer and fewer. Thus,  job opportunities are becoming limited to large bureaucratic organizations. They have so many applicants that they can put these applicants through an incredible job hiring processes that has little to do with the job they are being hired to do and a lot with testing to see if they will be good little employees in their cubicles. If high paying jobs were plentiful, no one would put up with this nonsense.

The way the economy is getting so rigid in the United States, you are either going to have to be a real hustler, connected or have a special skill that the elitists need. Otherwise, it is going to be very tough to get a decent job within the system. Your best bet may be to find a one-man service business that you can provide and people want.-RW


  1. You're right, Wenzel, it probably has to do with legal risk more than anything else. Businesses should be able to fire and hire at will, without risk of legal action. Firms will compete for labor, and some companies might attract workers by having a reputation for not laying people off, others might not offer much security but pay more up front. Different strokes for different folks.

  2. Hustler - I have a hard time lying.
    Connected - I hate begging.
    Certain skill set for the elitists - nothing special other than I work hard, and I don't think working hard is a skill set that elitists appreciate. That, and I don't kill people.

    Good article. Something that I have been thinking about a lot, recently. Jobs are too uniformed. It's as if the employer thinks that the employee works for the him and the company. Really, the employee has a contract with the company to get paid, and that employee works because and for his or her family.

    I think it would be helpful if people understood that they are in a contract and not a forced job. That workers understood the value of their work, if the state would stop distorting the value. Work shouldn't be uniformed in the sense of graduate high school, go to work (beg for job), get paycheck, retire. Workers mindset should not be how can I please the boss as some kind of privatized, NGO overlord, but how can I please the customer.

    I think there's something to be said of government schools and how we practice education in general. It indoctrinates us to be good little taxpayers when we grow up. First they take you as a kid from your family, then after you do have a family, they expect you to focus on the "granted"-established duties instead of your family. (Family is only so you can produce another generation of taxpayers.) Everything is uniformed. It's not supposed to be this way.