It’s time for the 6th installment of our annual sales hiring forecast. As there isn’t a hiring forecast specific for b2b sales roles, we started our own forecast in 2015 to help fill this gap. Our research for this forecast is based on aggregating Manpower, Linkedin and the Bureau of Labor & Statistics’ general hiring forecasts. By comparing these forecasts to historical data, we developed our 2020 sales hiring forecast.
2019 Sales Hiring in Review.
In our 2019 forecast, we shared Former Federal Reserve Chairman Alan Greenspan’s observation of employment in the United States in late 2018. “This is the tightest labor market, I’ve ever seen”. Things were even tighter at the end of 2019.
The unemployment rate, according to the Bureau of Labor & Statistics (BLS), fell to 3.5% in Dec 2019. This was down from 3.9% in Dec 2018. This is incredibly low given that economists consider full employment to be at 5%. This suggests a situation where there are more jobs than qualified employees to fill them and the data supports that view.
According to the BLS, as of Oct 2019, there were 5.8M unemployed persons in the U.S. and 7.3M job openings. This 1.5M gap between job openings and unemployed persons rose by .5M since Oct 2018. At that time, there were 7.1M job openings and 6.1M unemployed persons. Anecdotally, our observations of Sales Talent’s clients suggests that due to the difficulty of finding talent, many employers have more job openings than they are reporting.
Although there isn’t a direct measure, we can infer the unemployment rate for b2b sales by examining various subcategories listed by the BLS. They do list the unemployment rate for b2c and b2b sales professionals combined. It fell to 3.3% in Dec 2019 from 3.6% in Dec 2018. Given that b2c is roughly 4x larger than b2b, we need to look further to estimate was the b2b unemployment rate is.
Another subcategory that the BLS provides data for is the white-collar unemployment rate (workers that hold a Bachelor’s degree or higher). At the end of 2019, the white-collar unemployment rate was 1.9%. In December of 2018, the rate was 2.1%. Considering all of these factors, it’s our opinion that the unemployment rate for b2b sales professionals currently stands somewhere between 2% and 2.5%.
The data above indicates an all-out war for sales talent that is escalating with big implications for employers. With sales job openings increasing and the number of available unemployed sales professionals decreasing, employers find themselves fighting for the same talent. This pressure is leading to increased base salaries. Given the lack of b2b sales professional specific market data, it is impossible to determine what the % increase in base salaries from the end of 2018 to 2019 has been. What we can offer, is Sales Talent’s data. The average base salary for a Sales Talent hire rose from $97,992 in 2018 to $108,938 in 2019. That represents a huge 11.1% YOY increase.
2020 Sales Hiring Forecast.
Sales hiring in 2020 shows no signs of slowing down. Manpower forecasts a Q1 2020 Net Employment Outlook for the U.S. of +19% which is down 1% from Q1 2019. This is Manpower’s 2nd strongest hiring forecast in the past 13 years.
Linkedin gives further insight into the demand for sales professionals with their 2020 Emerging Jobs Reports. Three of the jobs on their list of the 15 jobs with the highest increase in hiring growth are in b2b sales. These jobs are Sales Development Representative, Customer Success Manager and Chief Revenue Officer.
An interesting data point that speaks to the increased war for talent overall is the demand for recruiters. Linkedin’s 7 Predictions on How Recruiting Will Be Different in 2025 shows that “the demand for recruiting professionals has jumped by 63% since 2016, and we expect that trend to continue.”
In sum, we expect sales hiring in 2020 to continue its torrid pace which means great times ahead for sales professionals. It also means that employers face the most competitive, candidate-driven employment market in history. To combat this, employers must utilize a three-pronged approach. The most effective strategy is retaining its current sales reps. Employers must also turn towards recruiting resources and approaches that target currently employed, passive talent. Our blog, the 4 Rules of Headhunting Elite Sales Professionals shares tips on how to do this effectively. Finally, an employer’s hiring brand is more important than ever. To gain insights, read How to Manage Your Glassdoor Reviews.
Future Sales Hiring.
Looking to 2021 and beyond, there are two factors that will intensify the battle for sales talent. The first factor is the aging of the U.S. population. Starting in 2011, Baby Boomers began retiring in mass. Compounding this is a falling birth rate. These factors slowed the growth in the size of the labor force in the U.S. from 2.6 percent annually in the 1970s to just .4 percent in 2020. With the BLS projecting an additional 8.4M jobs by 2028, there should be an even bigger shortfall between the number of open jobs and available workers.
Short term, the only thing that could derail this over-heated job market is a recession.