This is part of a series exploring tendencies and cues that can help recruiters gain a better understanding of passive candidates and how to target them better. This post is the first part of how you can use company-level data to better target passive candidates. You can read the introduction to the series here.
Company-level data is composed of information and news about the company where a candidate is currently working. There are pros and cons to using company-level indicators.
Pros - When you identify data which suggests that candidates may be more likely to change jobs, you identify a whole new host of candidates to contact. For example, let’s say that Acme Software Corp just announced that they will be laying off 1,000 people at the end of the year. This immediately raises the odds that
people at Acme may be more likely to leave, either because they fear being laid off themselves or because lay- offs typically have such a hit to morale that even those with more job security start to look around. If you’re attuned to these things, it can mean that you now have many candidates who may be more receptive to your job opening.
Cons - Company-level data is often not the most powerful indicator of propensity to change jobs. Even in companies with bleak environments, there are often many die-hards who won’t want to leave. The inverse is also true. Companies that are doing well have people leaving them all of the time for a variety of reasons. If you’re only focused on company-level data, you would miss these individuals. Therefore, you also need to look at individual-level data, which will be covered later in this series.
When you’re looking at company-level data, keep in mind that you’re looking for anything that would suggest a candidate’s propensity to leave or not leave their current job. Even more important, look for leading indicators of candidate availability.
We’ve done countless hours of research on this topic. Below is a list of things to look for.
1) Company layoff announcements
This is perhaps the #1 leading indicator of employees departing the company and looking for new opportunities. Of course, there’s the obvious fact that those being laid off will leave the company. But when layoffs happen, it typically means that others who aren’t laid off start looking for greener pastures. The announcement of impending layoffs significantly raises the odds that the company’s employees will change jobs in the coming months. It’s one of the reasons why layoff announcements can be so toxic to a company.
What to do: As a recruiter, you should spend at least a portion of your day paying attention to the business press. Read the high-profile newspapers and online media publishing business news, and set up Google alerts. Here's an example of one in the press recently.
2) High-profile departures
Another sign of trouble at a company is when senior-level executives leave. The departure of, say, the VP of Engineering of a company doesn’t necessarily mean that others will defect as well but, as with all of these things, you’re playing the odds. There are a number of reasons why the “domino effect” exists within companies. Sometimes it signals internal struggles. Often, the senior- level executives will see trouble on the horizon earlier.
What to do: Similar to layoff announcements, you’ll learn a lot of this through the business press. Think about where high-profile departures get announced for your industry/ geographic location and pay attention to those publications. You can even set up custom Google alerts to help you stay on top of these types of events.
3) Stock price declines
For candidates working at publicly-traded companies, one of the biggest leading indicators of people leaving is the recent performance of the stock price. Stock price declines are telling of all sorts of things. They may precede the kind of rough financial performance that could lead to layoffs. Poor stock performance also affects employee stock option value, which could impact retention. And stock price is of course highly correlated with morale in a company. At the end of the day, very few people want to go work in a dreary environment all day.
What to do: Stay in touch with stock price movements for companies that you are recruiting from (e.g., if you are recruiting for a gaming startup, you might include the ticker symbols of all of the publicly-traded gaming companies in your portfolio). Set up a portfolio on a site like Google Finance and check in every day or two. In addition to being able to better track stock price movements, you’ll also get updated news on related companies.