The most common question I receive from companies and candidates is “how is the job market?”  Let’s invest some time and explore the 2016 trends and my forecast for the year-end.

Overall summary – Year to date, the 2016 job market is slightly weaker than 2015.  While there are pockets of significant growth and hiring, there are more candidates on the market this year. I would expect it to get worse before it gets better.

There are two trends that foretell a turbulent end to the year. First, the potential for year-end layoffs is extremely high amongst the largest device companies. Second, as we go into the final stretch before the election, investment and corporate strategy may be sitting on the sideline waiting for clearer direction as they determine the political and economic environment going forward.

For companies, it’s still extremely challenging to find great candidates in marketing, quality, and regulatory. However, many very good candidates are also reporting that it’s hard to find exciting opportunities, especially in R&D and Manufacturing. Some larger companies are reducing R&D investment in favor of M&A strategies, and the trend of moving manufacturing to places with cheaper labor and more business-friendly countries is impacting engineering jobs here in the US.

Overall, the market lacks direction. This is likely due to the uncertainty created by the upcoming presidential election and lasting ripples from healthcare reform.

Big companies are reorganizing, merging, and soon will be cutting – Larger companies are not creating as many jobs this year in the medical device industry as in past years. The current political and economic environment has caused many US-based device companies to move their business out of the US or their funds into other entities that help avoid US taxes. Additionally, healthcare reform has caused many larger companies to merge or seek acquisitions as they struggle to drive growth in the economically unfriendly market.

Additionally, Medtronic and J&J have executed significant restructuring in an effort to simplify their device businesses and drive profit. While mass job losses have not occurred from these restructures, from my perspective this is likely to occur as we approach year-end.

Startup money is hard to find – Smaller organizations are where the majority of growth and innovation happen within our industry. Unfortunately, many CEO’s are reporting that significant investment is taking more time and is less available. This is in direct conflict with articles indicating that total 2016 VC investment is on track to be greater than 2015. This conflict is likely due to a smaller number of companies receiving larger investments.  There have been some significant acquisitions in the startup world, so it’s likely that these successes will spur additional investment once the markets have more reassurance on the direction of the political, economic, and healthcare environment.

Bottom line: It’s a mixed market – As we head into the last part of the year, we will see a seasonal pickup in hiring as companies focus on filling their remaining jobs for 2016 and start looking forward to 2017 hiring. It’s still a great time to be in the medical device industry; you just need to have a plan for your career. Companies with innovative technology that is changing the market are still hiring while larger companies are consolidating and early stage companies are having to scrimp and save to move their technology forward. Now more than ever, companies and candidates need experienced and well-networked recruiting partners to navigate this challenging market.

Future outlook and implications of the current market – The overall demographics of the industry remain extremely positive; retirements of aging baby boomers will continue to drive a talent shortfall in the device industry. Let’s face it—for an industry that relies on direct experience in very specific clinical areas of the device industry for key leadership roles, it takes years for talent to develop. This is a great trend for Gen X who is slowly starting to take over leadership at the device companies.

It appears we are in a slight calm in the talent storm. There are still great companies expanding and hiring; you just need to know where to look or who to ask. For leaders struggling to fill their openings, it’s important to partner with a great recruiter who knows the market and the talent pool well enough to know who to talk to and where to get great talent.

 

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