Friends, Our best wishes as we reflect on 2024 and the incoming 2025.
In over 35 years Alex and I have been in Executive Recruiting, one truism remains: Election years create uncertainty and chaos in hiring decisions. 2024 was no exception. There were clear pockets of activity as PE firms drove decisions to upgrade portfolio company leadership teams, but legacy companies [larger employers] hunkered down by freezing hiring and quietly [yet meaningfully] reducing ranks. Post the 2024 election, we have seen a significant increase in hiring activity as business already knows the incoming President, and Republican control of both the House and Senate signals a likely reduction in the pace of regulatory and legislative activity.
We expect hiring in 2025 to increase at both the executive and
FLIGHT levels, at least in some sectors and functions – services, aftermarket, operations, and supply chain. Reshoring activity under Trump will only
increase the competition for talent in manufacturing and supply chain functions. This talent market is already highly competitive, so
employers will have to step up to find and attract the talent needed. For these senior operations roles, the balance of power in negotiations remains on the talent side of the table. If you are looking for engineering talent, now is a good time as suppliers associated with mobility electrification and autonomy are shedding engineering talent until consumer demand stabilizes to warrant additional investment.
Other challenges will be relocation and talent mobility. Interest rates for housing [nearly 7%] are still high and housing stock is still low. Candidate willingness to give up a low interest mortgage is a significant hurdle to overcome. The ongoing tug-of-war over return-to-office requirements has not abated in core administrative roles [accounting, finance, treasury, engineering, and sales, among others]. Barrons recently cited a Stanford study showing little to no increase in share price when workers are required back in the office but showed a significant decline in employee morale [see article below]. Finally, the competition for hourly workers is far from over, creating all sorts of issues from worker safety to quality to on-time delivery.
So, that’s our view of what is to come. Probably not a big surprise but as always, if we can help you think through a position or strategy, please reach out.
