As COVID-19 cases continue to climb across the U.S., the Labor Department reported this morning that 963,000 more Americans filed new claims for state unemployment benefits last week. While not exactly good news, this is the first week since March where claims were reported below the one million mark for the week. Economists were expecting initial claims of 1.1 million and continuing claims of 15.8 million, based on median estimates. Economists note that it’s encouraging that claims for unemployment are going down because it means people keep returning to work.

While the sub-one million reading marks a milestone, there’s still plenty of work to do for the job market to get back to normal. Those collecting benefits for at least two weeks, known as continuing claims, totaled nearly 15.5 million, a decrease of 604,000 from a week ago but still well above pre-pandemic levels.

President Donald Trump last weekend authorized the payment of $300 a week in federal aid to unemployed Americans, smaller than the $600 benefit that expired in July – and limited by funds that could run out within two months. “It is certainly possible that we don’t come back, at least in certain sectors, in the same way as before,” said Mary Daly, president of the San Francisco Federal Reserve. That will mean a large number of workers are not able to go back to the same jobs they had before the pandemic.”

Diversified Search Places CEO at Federal Reserve Bank of San Francisco

Dallas Federal Reserve president Robert Kaplan said that if Americans do not comply with public health orders to contain the virus, unemployment will stay at around nine percent until at least 2021. “If we don’t follow that, while people may feel freer, the economy will grow slower,” he said.

During the week, 49 states reported 10,723,396 individuals claiming pandemic unemployment assistance benefits and 49 states reported 1,224,443 individuals claiming pandemic emergency unemployment compensation benefits. The highest insured unemployment rates in the week were in Nevada (23.6), Hawaii (21.1), Puerto Rico (19.1), Louisiana (17.3), New York (16.5), California (16.0), Connecticut (15.3), Georgia (14.4), Massachusetts (14.3), and Rhode Island (12.7). The largest increase in initial claims for the week was in Rhode Island (+87), while the largest decreases were in California (-22,610), Virginia (-19,048), Texas (-14,095), Florida (-13,176), and New Jersey (-11,489).

Related: Companies Planning Big Comeback Post-Pandemic Crisis

Data from Homebase, a payroll scheduling and tracking company, showed a decline in employment last week. Figures from Kronos, a workforce management software company, showed a flattening in the number of shifts worked.

Last week, employment rose by 1.8 million in July as the U.S. unemployment rate fell to 10.2 percent. That’s down from a peak of 14.7 percent in April, but still far above the 3.5 percent rate in February before the coronavirus pandemic led to mass economic shutdowns across the country. “We believe the labor market reached an inflection point in July, starting what will likely be a slower phase of recovery,” said Nomura economist Lewis Alexander said in a note ahead of results. “Stronger-than-expected employment growth in May and June was likely due in part to faster and more widespread re-opening activity. However, that earlier re-opening activity likely contributed to the resurgence in Covid-19 activity across the country, resulting in what we expect will be slower employment growth in July.”

Top Search Consultants Weigh In

“There are still new hires being made, but many tend to be replacement hires for an existing opening,” said Anna McCormick Kelch, co-CEO of LPA Search Partners. “Our clients have told us they have talent needs — especially as it relates to technology and digital transformation — but it is difficult to bring in new people if you have furloughed a significant percentage of your employees…bad optics. There is a sense now that a window of opportunity has opened to bring in some necessary skills that will be essential as companies continue to pivot.”

“I believe that the economy is in rebound mode and that hiring will start to turn the corner in the fourth quarter,” said Alan Work, founder and president of Work&Partners. “Clearly the election will have an impact on things but traditional views of Democratic or Republican administrations and its resulting economies may not hold.”

Related: 10 Tips for Networking with Executive Recruiters During COVID-19

Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor Hunt Scanlon Media

Mr. Work launched Work&Partners in 2002, building on his then 20-plus years as a leader in the executive search business. In focusing on the development of C-level teams, Mr. Work has filled roles at the level of managing director, partner, vice president and president. His expertise spans a range of industries and includes deep knowledge of the management consulting, technology consulting, financial services and telecommunications sectors. Prior to forming Work&Partners, Mr. Work was a founding partner of Hechkoff/Work Executive Search, where he delivered executive search services for more than 12 years to clients such as KPMG, IMS Health and FannieMae. Mr. Work also established strong relationships with a national client base during seven years as a senior recruiter for EDP World, New York.

I believe that big-firm growth is only making businesses like mine more attractive to clients. In theory, the big firms may be better known but, in my view, they cannot provide the same customer care and flexibility that firms like mine and our brethren boutiques, can deliver.

Mastering the Trade

Due to the fact that many of the larger firms, particularly those that are publicly traded, have to satisfy the bottom line or quarterly earnings, spending significant time with one specific client is counter to the type of pressure they are under to add to their volume. Because we are nimble and require far fewer clients, to not only survive but also succeed, we can spend the time necessary to get inside and understand the culture from top to bottom.

The result is that we can do better work and clients seem to positively acknowledge the partnership being formed. We are not, therefore, viewed as a recruitment firm that is going in for the quick score and moving on to its next assignment. I think we are beginning to see more clients really taking a harder look, and I think the lines of demarcation are getting larger because, quite frankly, the larger firms are expanding while we are remaining small and pure-play search providers.

Work&Partners provides recruitment services across technology, management consulting, financial services, and various digital disciplines. For a smaller search firm, balancing such an array of specialized sectors and serving them well can be a difficult trick to master. But we handle it with aplomb and, today, we count among our clients companies like Capgemini, Merrill Corp., LiquidHub, The Omidyar Network and Clarity Solution Group.

Clearly we have been able to attract top quality clients despite the fact that we are not a big name brand. I would argue that because we are not large we are viewed by today's clients, which are far more sophisticated than in years before, as the choice to work more quickly and efficiently. In short, without the red tape or bureaucracy that is weighing down our larger rivals today.

Stick to Your Knitting

I do understand why the big firms have been expanding their offerings in recent years and why their clients might find their ancillary services beneficial. On the other hand, I believe this trend simply makes firms like ours stand out even more. Look at a firm like Korn Ferry, for example. They recently acquired Hay Group for almost $500 million. But they have been broadening their services for some time now and they are looking more like traditional consulting firms than traditional retained search firms. In some respects, I think this is helpful to their clients because as a 'broader' consulting firm they can service their clients from top to bottom and side to side.

But, here, again, I think this has helped distinguish a firm like ours that is not pushing into every business. If we attempted to broaden out to include audit and assessment or compensation consulting I think it would be a turn-off to our clients. Instead, we are focused on just search and, for those clients of larger search firms that still want just that, it's helping firms like ours that are sticking to their knitting so to speak.

As search firms begin to look more like consulting firms I think consulting organizations might well start to look to search firms as acquisition targets. It could happen. Years ago, firms like A.T. Kearney were involved in search, and with the industry broadening and the lines blurring I would really not be too surprised to see consulting firms looking at recruitment once again as a viable option.

Early in my career I had little desire to work in executive search, though a number of firms expressed interest in me. Instead, I became a sales executive in the garment industry and did well. After about six years, just before I was to get married, my then fiancée convinced me to talk to her best friend's sister, who ran a search firm that specialized in recruitment for technology companies.

Initially, I thought they might introduce me to IBM. But instead, they offered me an opportunity to work with them in executive search with a focus on the sales/sales management side of the high-tech sector. I came on board in the middle of a big economic downturn and survived by the skin of my teeth. I naively thought that I would be protected because of the personal relationship that existed. I found out later that they had let go many relatives and friends of the firm's leadership. On the serendipity side, I got married, moved into a new place, and changed careers all inside of six weeks, which, 30-plus years later, has proven to have been a great decision.

One-on-One Partnerships

A big part of my success comes down to taking advantage of opportunities that present themselves. Getting involved in recruiting for management consulting firms some 25 years ago, for example, was largely the result of a void in the marketplace. The big search firms tended to struggle in that space, based upon client feedback [and our subsequent experiences and successes] and I felt that the mindset, processes, and personalized service that a firm like ours brings gave us an advantage in a very competitive environment.

Because of their size and approach, smaller search firms with specialized experience can do very well in spite of the big firms. I genuinely believe that some of the best one-onone relationships exist in firms that are boutique in nature. That's not to say that consultants at large firms don't care about clients or hard work. But as the large firms keep getting larger there has been a tendency to look at this business in more of a commoditized way instead of what we view as a one-on-one partnership.

At my firm, I dive in on any given assignment and my staff and I put in the hours and effort to get it done properly. I'm not handing it off to a junior consultant who might also be working on a dozen other assignments. Unfortunately today we are seeing too much of this practice. Large firms have been quite adept at reeling in top business but, once they have it in house it does not receive the same level of professional service that was applied to securing the assignment in the first place. The fortune aspect is that, today, clients are far more sophisticated and understand when the quality of an assignment has been adversely affected. The result is that it's shining a new and positive light on firms like ours because we do the work; plain and simple. This means the quality is always top shelf.

Also, as a boutique firm, we can be more nimble, proactive, and able to respond to evolving market directions. That's partly a function of the firm's size but also because of its hard-won knowledge of the industries we serve. All that allows our firm to branch out into more than one sector and to serve our clients in those areas well.

Our successes in healthcare, big data & analytics, and in chief marketing officer functional searches certainly have given us a hybrid look, but with a specialist tint. Not every firm our size has narrow specializations. In fact, there are dozens of firms that I would call 'semi-specialists.' They work across maybe five to six sectors; they know the space well, and maintain a focus on just those sectors without adding or subtracting. It's worked well for us, but it's not an uncommon combination for this industry.

Not long ago, as an example, we placed much of the senior management team at IT systems integrator LiquidHub, from its chief operating officer, to its digital practice leader, to its corporate strategy officer. It was just one example of how a small firm working as a partner to a client can make a big difference in that company's success, not to mention its own success.

Here Come the Millennials

Clearly, having a relationship like we have with a LiquidHub puts us in a terrific position to add value and have a tremendous impact on their business. We work very closely with all of their leadership [CEO, COO, CFO, CHRO, VPs and practice leaders] from beginning to end and also have done SME/consulting type assignments for them around growth strategies and the hiring experience. I believe we are considered trusted advisors and we value that relationship tremendously.

This is where I think a firm structured like ours works well with clients. Again, this is not a knock on the large generalists, but when you know and understand your space as well as we do, as is the case of other firms with a similar make-up as ours, we can spend significant time on the inside and are not pressured to have to go out and land 10 other assignments simultaneously.

Hiring in the technology field poses particular challenges for client companies. Younger professionals are increasingly winning jobs over older individuals who may have more experience but lack knowledge and awareness of new and cutting-edge trends.

Companies are really looking at a much broader scope of candidate today versus in years past where they may have considered only a very seasoned professional. In short, they are keeping their options open. I also think that technology companies are looking, to a greater extent, at best athletes today versus those that may operate in narrow silos. There are a great many talented professionals in this space and the landscape is highly competitive. It makes our work more interesting, for sure.

VIEWPOINT: ALAN J. WORK - WORK∓PARTNERS

The hallmark of many successful search firms is their structure: focusing in on one, specific industry or functional discipline can make them, in the eyes of that sector, the go-to expert. While it is challenging, some search firms have been able to stay small while combining specialty practices where the focus of their expertise is not diminished.

Alan J. Work, president and founder of Work&Partners, has seemingly found the secret recipe. A specialist across technology, management consulting, financial services and various digital disciplines, he has created a unique brand in search. Clients ranging from Capgemini, Merrill Corp., LiquidHub, Deloitte and PayPal have created a solid and varied base of business for Alan and his team.

In the following interview, Alan discusses his breadth of expertise and the strategy behind developing his firm over the past 14 years.

Alan, you have worked in executive search for over 25 years. What was your career path into the industry?

Serendipity and naivety at some level. When I got of college many of the agencies and recruiting firms that I was working with asked me to join their teams as a recruiter. It didn’t seem like something I wanted to do. Then I went into the garment industry as a sales executive and had a very successful six years both financially and with my career. Just before I was going to get married, my then fiancée suggested I meet with her oldest friend’s sister who was running a search firm that was focused on the technology sector. Initially I thought they might introduce me to IBM but, instead, they offered me an opportunity to work with them in executive search with a focus on the sales/sales management side of the hi tech sector. I came on board in the middle of a big economic downturn and survived by the skin of my teeth. I naively thought that I would be protected because of the personal relationship that existed. I found out later that they had let go many relatives and friends of the firm’s leadership. On the serendipity side, I got married, moved into a new place and changed careers all inside of six weeks which, 30-plus years later, has proven to have been a great decision.

You serve an interesting array of industries, from management consulting to healthcare. How did you decide to focus on that grouping of sectors; was it strategic and do you consider your firm a specialist or a hybrid generalist?

Great question. Our decision to enter the management consulting arena over 25 years ago was driven by the fact that there was a void in the marketplace. The big search firms tended to struggle in that space based upon client feedback [and our subsequent experiences and successes] and I felt that the mindset, processes and personalized service that a firm like ours brings gave us an advantage in a very competitive environment. And I think this is true throughout search. I genuinely believe that some of the best one-on-one relationships exist in firms that are boutique in nature. That’s not to say that consultants at large firms don’t care about clients or work hard. But as the large firms keep getting larger there has been a tendency to look at this business in more of a commoditized way instead of what we view as a one-on-one partnership. It’s so critically important that I conduct my own work. I am not handing it off to a junior consultant who might also be working on a dozen other assignments. Also, as a boutique firm, we can be very nimble, proactive and can respond to evolving market directions, both due to our size and knowledge of the sector we have been serving for so many years. As a result, our successes in healthcare, big data & analytics and in chief marketing officer functional searches certainly have given us a hybrid look, but with a specialist tint. Not every firm our size has narrow specializations. In fact, there are dozens of firms that I would term ‘semi-specialists.’ They work across maybe five to six sectors; they know the space well and maintain a focus on just those sectors without adding or subtracting. It’s worked well for us, but it’s not an uncommon combination for this industry.

You recently placed much of the senior management team at LiquidHub, from its COO, to its digital practice leader to its corporate strategy officer. Describe the process when you work with a client like that and do you consider yourself more like a strategic talent acquisition partner than a recruiter?

We consider ourselves ‘partners’ in every endeavor we undertake with all our clients. That’s part and parcel of insuring mutual success throughout the relationship. Clearly, having a relationship like we have with a LiquidHub puts us in a terrific position to add value and have a tremendous impact on their business. We work very closely with all of their leadership [CEO, COO, CFO, CHRO, VP’s and practice leaders] from beginning to end and also have done SME/consulting type assignments for them around growth strategies and the hiring experience. I believe we are considered trusted advisors and we value that relationship tremendously. This is where I think a firm that is structured like ours works well with clients. Again, this is not a knock on the large generalists, but when you know and understand your space as well as we do, as is the case other firms with a similar make-up as ours, we can spend significant time on the inside and are not be pressured to have to go out and land 10 other assignments simultaneously. That’s partly the challenge of larger firms at times. Due to the fact that many of the larger firms, particularly those that are publicly traded, have to satisfy the bottom line or quarterly earnings, spending significant time with one specific client is counter to the type of pressure they are under to add to their volume. Because we are nimble and require far fewer clients, to not only survive but also succeed, we can spend the time necessary to get inside and understand the culture from top to bottom. The result is that we just do better work and the client really looks at us as a true partner, not a recruitment firm that is going in for the quick score and moving on to their next assignment. I think we are beginning to see more clients really taking a harder look and I think the lines of demarcation are getting larger because, quite frankly, the larger firms are expanding while we are remaining small and as pure-play search providers.

What do you view as the biggest challenges facing technology companies today in terms of recruiting senior talent?

I think technology companies today have a number of challenges to contend with – but I think the most prominent issue is that our clients are really looking to younger professionals today versus those with more experience but who lack knowledge on what is new and cutting edge. It’s evident to most that technology is changing today so quickly that one can barely keep up with it. Therefore, companies are really looking at a much broader scope of candidate today versus in years past where they may have considered only a very seasoned professional. In short, they are keeping their options open. I also think technology companies are looking, to a greater extent, at best athletes today versus those that may operate in more narrow silos. There are a great many talented professionals in this space and the landscape is highly competitive. It makes our work more interesting for sure.

You work extensively with management consulting companies. Are recruiting firms, which are diversifying into more consulting-type services, becoming more like those clients and do you think consulting firms will look to search firms as acquisition targets?

To answer your first question, yes, I do. Look at a firm like Korn Ferry, for example. They recently acquired Hay Group for almost $500 million. But they have been broadening their services for some time now and, to your point, they are looking more like traditional consulting firms than traditional retained search firms. In some respects, I think this is helpful to their clients because, as a ‘broader’ consulting firm they can service their clients from top to bottom and side to side. Here, again, I think this has helped distinguish a firm like ours that is not pushing into every business. If we attempted to broaden out to include audit and assessment or compensation consulting I think it would be a turn off to our clients. Instead, we are focused on just search and, for those clients of larger search firms that still want just that, it’s helping firms like ours that are sticking to their knitting so to speak. As far as consulting firms looking at this industry as a viable option, it could happen. Years ago, firms like A.T. Kearney were involved in search and, with the industry broadening and the lines blurring, I would really not be too surprised to see consulting firms looking at recruitment once again as a viable option.

Contributed by Christopher W. Hunt, Publisher, Hunt Scanlon Media and Scott A. Scanlon, Editor-in-Chief, Hunt Scanlon Media