How Covid-19 is impacting hiring and onboarding among startups


As the recruitment market changes, we offer some practical ways to approach the challenges and opportunities.

Technology lies at the heart of the majority of startups and hiring trends in the broader tech sector inevitably impact the high growth community. With tech vacancies in the UK dropping by 18% in the last month, the employment market could be set for tough times.

According to business information specialists, GlobalData, cloud computing roles dropped the most (by 26% month on month) with AI falling by 24% and Big Data by 20%. Cyber security roles were the least impacted, dropping just 7%. The worldwide shift in tech sector vacancies across the more than 800 companies analysed also shows a drop of almost 18%.

Startups and recruitment

So, what do these macro trends mean for startups and scaleups? A survey of 200 startups conducted by Local Globe and Latitude, found that, while few had significantly cut their headcount, 50% had stopped recruiting while a further 30% had slowed hiring. Just 10% said that Covid-19 had not impacted their plans at all and only 3% were hiring more than planned.

The survey, carried in partnership with organisations including Barclays, also found that 16% were planning to lay off at least 10% of their staff. A quarter had furloughed at least 10% of their staff and 30% had cut salaries by at least 15%. Such cost saving measures are unsurprising given that 70% of startups expected full-year revenues to drop more than 25% below plans.

Remote recruitment and onboarding

While the coronavirus pandemic has caused many startups to hold off from hiring, for others it has created an increased need. However, with a global lockdown that is only now starting to be eased, face-to-face interviews became impossible and onboarding of new staff had to be done remotely.

Workable, the tech recruitment solution that has enabled over one million hires, recommends using software such as Rippling or Click Boarding to help with remote onboarding.

Other advice for inducting new employees includes:

  • Effective comms has never been more important. Ensure new employees understand how to make the most all the communication tools that your business uses, such as Slack and video conferencing.
  • Increase the amount of ‘face time’ a new employee would normally have with their manager. You can reduce this contact time over the first weeks and months, but is important the colleague feels supported in the early stages.
  • Ensure the new recruit gets to know their teammates. A quick round of introductions in a meeting will not suffice. Organise some sort of remote group activity, perhaps both work-focused and more social, so that the new recruit can feel part of the team. Having colleagues spend 20 minutes talking about anything but work is amazingly effective at building connections and better understanding of personalities. This will allow easier communication and greater efficiency further down the line.
  • Record training sessions. Press record on Zoom, Skype etc. before you take a new team member through a system, product or workflow on a video call. What is second nature to you is an avalanche of new information to them – recording the call means they can go back over it whenever required.
  • Don’t overlook culture. The culture of a startup is something that is much more easily learned by observation in an office environment than taught by an employee manual. It’s easy to skip the part of onboarding in which you make clear what’s really important to your business and the expectations around working with colleagues and clients. Getting a new hire up to speed on your culture will make them feel more engaged with the business and their teammates.
  • Consider the needs of your new employee. We all have different learning styles and personality types, and onboarding is more effective if you understand your employee’s preferences. Consider using profiling systems such as DiSC or Myers-Briggs, or look for similar free tools if budgets are limited.

Greater choice of candidates for startups

Job losses are already being seen across the startup and tech sector. While this is bad news for the individuals involved, it does mean there is a greater pool of talent available to those businesses that are hiring. It may also mean that salary expectations will reduce, giving startups access to more experienced people at lower rates, protecting their cashflow and extending their runway.

A more global view of hiring

Another trend that is likely to emerge from the disruption caused by Covid-19 is a greater acceptance of remote working. Startups were ahead of the curve on this and the pattern will grow as businesses build on the experience gained under lockdown, in which they discovered new ways of working that did not require colleagues to be in the same space.

Company culture and alternative incentives

Culture will take on even greater importance as startups tighten their belts and reduce salary costs. A business’s values, ways of working and attitude have always been key in attracting the right people, and will become even more so when there is not the budget for big incentive packages. For those companies that are hiring, culture will be crucial, especially among younger age groups.

Founders may also have to reconsider how they use equity to attract key staff if they cannot provide required salaries. New ways of working may also have to be considered, with greater flexibility in terms of location or working hours to bring the right talent on board.

So, while all indicators show that there are tough times ahead for the startup recruitment market, there are some upsides. Businesses should emerge from the disruption with new ways of working and a clearer sense of their culture. And those who unfortunately find themselves without a job may take the opportunity to develop their own ideas that will, in time, become the next generation of startups looking to grow and recruit.

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