Helping Ease Unemployment Rate: Should You Consider Open Hiring?

business

The COVID-19 pandemic has greatly affected the global economy. Businesses closed down to comply with the public health protocols. Some businesses struggled to keep up with the new normal, forcing them to shut down permanently. Many employees lost their jobs and remain unemployed.

According to the Bureau of Labor Statistics (BLS), the unemployment rate in the U.S. remains at 6.7 percent as of December 2020. The bureau mentions the increase in Covid-19 cases and the efforts to contain the pandemic causes the decline in payroll employment.

Low-skill and entry-level workers struggle to secure a job due to the barriers in the hiring process, such as the interview, background checks, and having an impressive resume. Companies also experience problems in hiring and retaining dependable workers due to these barriers.

Open hiring is one way to help ease unemployment problems. But will it work for your company?

What is Open Hiring?

Finding the right employees is vital to the success of a company. Employers practice a tedious hiring process to filter applicants and find the best candidates for the position. That is why interviews, background checks, and personality tests for job applicants are important to make sure they are hiring the right people.

Open hiring eliminates these barriers. It is a hiring method where people who apply first get the job. Applicants don’t need to submit resumes, pass an interview, and have their backgrounds checked. Employers will judge applicants based on their ability to work regardless of their past.

The goal of open hiring is to provide opportunities to people who struggle with the barriers in the traditional hiring process, including those who are formerly incarcerated, the homeless, and individuals who are in recovery. It also promotes diversity and inclusivity within an organization.

The Body Shop is one of the companies that adopt the open hiring approach. A Forbes report explains the company is willing to offer retail jobs to interested people on a first-come, first-serve basis.

Adopting this recruitment approach, The Body Shop aims to reduce bias during the selection process. Instead of the usual recruitment process, the company chooses candidates by asking three questions:

  1. Are you authorized to work in the U.S.?
  2. Can you stand for up to eight hours?
  3. Can you lift more than 50 pounds?

Open hiring employees has helped executives of The Body Shop to fill vacancies without spending too much. The company reported a 60 percent drop in monthly turnover in their distribution center. This approach may work for The Body Shop, but not all businesses can adopt this method.

Should You Use This Method in Your Company?

Open hiring has its advantages that can benefit your company. Despite that, such an approach can harm your organization in the long run. Make sure your company is suitable for adopting this kind of recruitment process.

Here are the advantages of the open hiring recruitment method:

  • Creating a diverse working environment — recruiting employees through open hiring allows more people to get a job. You’ll create a pool of employees from different walks of life and have access to a variety of talent and experiences.
  • Faster recruitment process — open hiring makes the hiring process much faster compared to the normal one. There will be no interview process, background check, and other qualifying tests. Simply hire the first people who come to apply for a position and ask the important questions.
  • Positive impact on society — eliminating the barriers in the recruitment process allows many people to work. This is important for those who are often overlooked in society due to their past or lack of credentials.
  • Increase retention rate — an applicant-based hiring process can help improve your company’s retention rate. Hiring people who often face the barriers gives them the chance to prove themselves to the company. They are likely to be loyal to the organization that gives them this kind of opportunity.

Despite the positive effects of open hiring, you also have to consider the risk of hiring people without screening them or doing background checks. The safety of other employees, for example, could be at risk, especially if they work with someone who may or may not have committed a crime in the past.

Critics also point out that open hiring penalizes those who come late on the recruitment day. These latecomers can be more suitable for the position but failed to come early due to facing other barriers. They might not have access to the Internet to know about the open hiring event.

Open hiring seems a promising solution to the unemployment problems in the US. Since more people can have the opportunity to get a job, the economy will benefit. But you have to plan your strategy carefully before adopting this approach. Make sure you’re not compromising your company’s growth.

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