Typically, employers institute hiring freezes when business is flat or in decline. However, companies may also use hiring freezes to protect profits even when business is relatively stable.
Examples of a Hiring Freeze
In 2022, Facebook’s parent company Meta instituted a hiring freeze across most teams in the wake of a decline in quarterly revenue and profits. The New York Times reported that the hiring freeze would affect engineers and some data scientists. In addition, Meta CEO Mark Zuckerberg announced reduced budgets and staff cuts.
How Do Hiring Freezes Affect Workers?
Hiring freezes have impacts on workers that go beyond the obvious issues of fewer job openings to choose from and smaller teams to achieve company goals.
Impacts on Job Seekers
Job offers rescinded: During a hiring freeze, employers may rescind job offers that they’ve extended to candidates and would otherwise honor. This is generally legal. In most cases, a company can rescind a job offer for any reason—or no reason at all. Fewer opportunities: Multiple hiring freezes across employers may mean fewer job choices if you’re looking for a new role. Less power to negotiate: If enough companies in your industry institute hiring freezes, you may find yourself with reduced negotiation power. Over time, this can lead to lower wages and slower career growth.
Impacts on Employees
Stalled promotions: Although not every hiring freeze is absolute, many employers will also freeze promotions and transfers, as well as new hires. Stagnant career growth: Lack of mobility within organizations means fewer chances to build your career path internally. You may also have fewer opportunities to learn new skills or work with other teams, which could have a negative effect on your career trajectory. Increased job stress: When companies cease filling open roles, remaining employees often wind up with increased workloads. This can make it harder to achieve your team’s goals and make work more challenging and less rewarding for everyone.
How To Prepare for a Hiring Freeze
Although you can’t always predict a hiring freeze, there are a few ways you can prepare for one.
Look for the Signs
Employers are more likely to institute hiring freezes and other cost-cutting measures in times of economic difficulty. So, if you know that your company is having liquidity problems or is undergoing restructuring, it’s reasonable to expect a hiring freeze. The same goes for economic crises like recessions. The bottom line is when business is slow, so is hiring.
Keep Your Resume Ready
Regardless of the economic environment, it’s always wise to keep your resume updated and your professional network strong. Take a few minutes to update your skills, remove old positions, and refine the formatting.
Upskill
If you had to look for a job tomorrow, would your skill set be ready? Look at job openings in your field and note the required and desired skills. Fill any gaps by upskilling with online classes, certifications, or self-study.
Don’t Panic
Job searching can be stressful, no matter your situation. However, if you’re looking for work due to a possible hiring slowdown at your current employer, you’re ahead of the game. By keeping your options open, you’re ensuring that you’ll have better choices. And that’s the best way to keep your career going strong.
