Is Now the Right Time to Expand Your Workforce?
While we were in a client meeting not long ago, the question came up: what’s the best time to expand my staff? Growth is, of course, one of the central goals for any company, but growing the workforce can come with a lot of complicated considerations. It can be a real challenge to figure out how to balance the need for more staff to handle increasing capacity with the additional resource strain that a bigger staff requires.
So, what’s the answer? Well, as with most things in business (and in life), there’s not necessarily one “right,” one-size-fits-all solution. But we often recommend monitoring a few key factors when making this call.
Let’s start with the big picture: the state of the economy overall. As we emerge from a few years of significant uncertainty, the American workforce seems to be heading towards more stability. The Bureau of Labor Statistics projects slowed workforce expansion in the coming years at a rate of approximately 0.4% annually between now and 2032. While job gains have slowed a bit in the later months of 2023, the Federal Reserve maintains that the economy is growing at a “solid pace” (up from a “moderate pace” earlier) and that job gains “remain strong.”
That means that many individual companies can approach the prospect of growth with optimism, but that growth must happen at the most opportune moment – or it can turn into a stumbling block instead of a boost. To feel confident that you’re making the right decision for your team, there are a few different categories of questions you should keep in mind.
Where is Your Organization Right Now?
Before deciding to expand, take stock of your current talent, capabilities, and financial status. Are your employees constantly overwhelmed with task demands, or is the workload manageable with slight adjustments? Is the workload starting to trickle down and affect customer satisfaction and loyalty? Are there processes that could be streamlined, automated, or enhanced with technology to alleviate stress instead of simply hiring?
Be sure the financial health of your organization is taken into account, too. Can you afford new hires, and if so, where will their salaries come from?
When discussing these questions, it’s important to focus on the “sleep-at-night” factor. You need to be comfortable with the financial implications of the hiring costs and how they fit into your overall plans for growth.
What Internal and External Demands Are You Facing?
As with any business decision, you need to have a clear understanding of the why behind your potential workforce growth. What do you specifically hope to gain from hiring more people? For instance, addressing skills gaps is a common reason many companies have for adding staff.
Hiring to fill the gaps that are most crucial for your business growth may make good business sense, or reskilling your current team may prove to be a more cost-effective option. If you do decide to hire, make sure that everything is in place – infrastructure, processes, etc. – to accommodate more employees without hitting bumps along the way.
On the flip side, it’s important to consider demand and pressures from outside your company. If your competitors are expanding their teams, it might indicate a shared optimism about market expansion that could nudge you to make a similar decision.
When Not to Hire
Sometimes, after we have these conversations, we end up recommending that our clients delay the hiring decision. There can be a number of reasons to hold off on hiring, such as:
- Market Mayhem: If the client’s industry feels too much like a roller-coaster ride with exhilarating sales highs and stomach-churning revenue drops, wait to hire until things smooth out.
- Lacking Long-Term Plans: If hiring seems like a good idea right now, but you don’t have a long-term road map in place, it’s a recipe for getting lost along the way – hold off until your future plans are clearer.
- Onboarding Obstacles: If you already know your onboarding process needs some work, it’s probably best to wait to hire until you can be confident the onboarding will go smoothly because better onboarding leads to better retention.
- Overloaded Office: If the people who would have to train the new talent are already operating at 110% just to handle their current workloads, you need a plan to cope with that reality before you add more people (and maybe more stress) to the mix.
Optimism for Long-Term Success
You may find that getting an outside perspective on your expansion plans is helpful. We often find ourselves consulting on talent acquisition for growing organizations and going through the pros and cons of plans for hiring, with clients. Someone outside your immediate company might ask questions or point out aspects that you hadn’t yet considered, and those observations can wind up having a big impact on the success of your plans.
NW Recruiting is here to help your organization develop and implement a growth plan that’s right for you. We’ll work with you to find a balance between “striking while the iron is hot,” so to speak, and maintaining your core organizational culture and efficiency. Reach out to our team for a consultation about the availability of talent for your current in-demand roles and current salary requirements for top talent – we’re here to help!