November 20, 2020 – The election of Joseph R. Biden Jr. to the Presidency promises significant change in Washington, D.C. for the next four years. Many questions remain about whether the incoming administration will be able to achieve its agenda, for better or worse, depending on one’s outlook – and the results of two Senate races still to be called in Georgia on January 5. What seems clear, however, is that the executive branch will take a calmer, more predictable approach to governing and leadership. For the business world, and as a result executive search, that’s good news; less turmoil and more certainty is always welcome.
Hunt Scanlon Media recently turned to executive search leaders from around the country to share their thoughts on what impact they thought the new President and his team will have on a range of topics, including the economy, the search industry, unemployment and hiring, climate change & sustainability, diversity, healthcare and global relations. The recruiters had all kinds of compelling replies, but the common denominator: They all agree that it’s going to be an interesting ride for everyone, especially in the face of the ongoing COVID-19 crisis.
Defeating the coronavirus, of course, is Job One for the next President. A quarter of a million Americans have died from COVID-19. As the pandemic deepens and shatters new records for infection rates and hospitalizations practically every day, everyone agrees that it is imperative that the pandemic be beaten back if the economy is to start churning on all cylinders again. The good news is that two highly effective vaccines are working their way toward regulatory approval, with distribution possibly starting as soon as next month and reaching more of the public as 2021 goes on. Most executive recruiters say this is the linchpin to recovery.
A number of recruiters, meanwhile, were worried when the pandemic hit that it might derail the progress so many companies have been making in terms of diversity and inclusion. Judging by the positive reaction some of the recruiters we spoke with had to the election of Kamala Harris as the next Vice President, those efforts are about to get an enthusiastic boost.
But enough of what we think. Here’s what the recruiters we spoke with have to say.
“The election should result in more predictability,” said Larry Shoemaker, president of Cornerstone International Group. “For the last several years, the U.S. economy had done well, despite uncertainty. Going forward, if there are challenges, having more confidence in what to expect should make resolving them less difficult. A less chaotic presence should create more opportunities for U.S. companies around the globe, and that will have a positive impact on our economy.”
Just that President-Elect Biden was elected may not have a great deal of impact on the executive search industry, he said. “The positive impact will be from the reduction of uncertainty,” Mr. Shoemaker noted. “Organizations have shown a remarkable degree of adaptability as they have responded to COVID-19. While some have been moving forward, many are just now coming out of survival mode. With less uncertainty, there will be more willingness to make decisions based on the mid- and long-term, and hire for the future,” he says. “The combination of the election being over and a new vaccine arriving should indicate 2021 will be a good year for the executive search industry.”
As organizations move from survival mode to growth, new roles will open, Mr. Shoemaker said. “There will be some reskilling required, and there will probably be fewer jobs overall, but the unemployment rate should continue to decline. The highest levels of unemployment are in industries like leisure and hospitality that have been dramatically impacted by the pandemic. A vaccine for COVID-19 will have more influence on increasing hiring in these industries than the President.”
“At the end of the day, leadership is not going to change very substantially; if anything, we’re going to tend to be a little more humanistic in our view of human resources issues and embrace a broader array of personalities and lifestyles in an environment that’s a little more inclusive under a democratic led government,” said Bernard Layton, managing director at Comhar Partners. “I think leaders in managing talent will need to be careful. They will need to manage a more diverse and a more inclusive environment with some added pressures of growth and tax revenue to the federal government, which will have an impact on the performance of the PE firms,” he said. “Ultimately, I think we’re going to settle into a pattern, that with an established political leader, will be a lot less erratic in terms of the message this week being “A” and message next week being “B.”
“I think, particularly post COVID-19, we’re going to enter into an era where we’re going to get pretty sustained growth, and that bodes well for private equity firms as the demand curve picks back up and top line revenue grows,” Mr. Layton said. “It gives an opportunity for financial performance to be better than it has been with inconsistent federal government messaging, which may lead to the need for more executive recruiting as these PE firms grow.”
City Migration to Continue
“The U.S. President-elect faces a major challenge in 2021 as he balances the health-related response to COVID-19 with economic actions to return the U.S. to the robust economy it experienced before March,” said Timothy Smith, founder and CEO at ASLON and USA partner of the International Executive Search Federation. “The U.S. economy has improved markedly in the third quarter, but that progress could be derailed depending on COVID-19-related decisions by a new administration. Businesses and individuals will likely face higher taxes and more regulations under Joe Biden, while the economy and businesses thrived under Trump. Fortunately, the country’s two-party democracy is intact, with more conservative-minded lawmakers elected to the Senate and House of Representatives,” he said.
“I don’t expect we will experience a quick return to the bull markets we experienced in 2018 and 2019, prior to COVID-19,” said Mr. Smith. “Nor will CEO confidence soar under the new administration with the onset of higher corporate taxes and regulations that President Trump removed. The executive search industry in America may see some pent-up demand cause a bump during 2021 – post-pandemic – but it will not be significant. A confident and soaring executive search climate will have to wait at least two to three years before thriving again. I also predict the pandemic experience will affect executives’ decisions on where they choose to live and raise families. There is already migration away from highly-populated cities.”
“U.S. government stimulus programs, and actions of the Federal Reserve, have considerably reduced the stark U.S. unemployment levels projected at the start of the pandemic,” Mr. Smith notes. “Further improvement is dependent on the success of vaccinations in the first half of 2021, which in turn will impact business activity, consumer spending, hiring, and investment. If the pandemic is put behind us, it will likely be a slow road to reducing the U.S. unemployment levels to the record lows of early 2020, however.”
10 Million New Jobs in Clean Economy
“President Elect Biden has been very vocal in saying that climate change is going to be one of his top priorities as President,” said Sean P. Rigsby, managing partner of Rigsby Search Group. “He has spoken about investing heavily in the clean energy economy and has made it a major issue of his platform. He has spoken about focusing on research & development and zero carbon technologies as an example. We have started contacting our clients since the election to get their thoughts on this subject, but while I do feel we will see an increase in this area, I feel it’s still too early to say to what extent.”
“Biden has said that one of his first acts would be to have the U.S. re-join the Paris Climate Accord,” Mr. Rigsby said. “Also, Biden has been very clear that he wants to transition the U.S. from being reliant on fossil fuels to one more driven by wind, solar and other renewable-energy sources. I do think a lot is going to depend on how well Biden and a potentially Republican controlled Senate can work together, but I am feeling optimistic that they will be able to find a common ground on partnering together.”
“Biden is saying his plan will create 10 million new jobs in the clean economy space,” Mr. Rigsby said. “Our firm works exclusively within the environmental industry, and we work in a number of different services areas, but I do truly feel we will see an uptick within the renewable energy space. I think we will see a wide variety of positions that companies are going to need filled in the renewable energy space such as civil engineers doing green infrastructure, atmospheric & geoscientists, energy specialists, solar installers and many other types of positions.”
Big Rise Expected in DE&I
“There is an intense focus on equity, inclusion and diversity, unlike ever before,” said Neela Seenandan, co-CEO and managing partner at Hanold Associates. “We are deliberate in our efforts in advising companies to make a more intentional effort to attract, retain and develop a truly diverse workforce and leadership team. This requires thoughtful hiring and development strategies and performance philosophies that highlight and create opportunities for growth and mentorship. When it comes to hiring, business leaders should no longer hope for a diverse slate of candidates―they should demand it.”
“The election of Kamala Harris shows every child, especially females―of any race or color―that they can dream big, and that hard work and aspiration will fuel achievement,” Ms. Seenandan said. “Kamala said it well: “Dream with ambition, lead with conviction, and see yourselves in a way that others may not.”
“Most U.S. companies are aware that they need to continue diversifying their leadership team―for many reasons―and especially in reflecting their communities, customers and employee population,” said Ms. Seenandan. “This work has already begun, and this focus has heightened and gained momentum in the last several years. Having a female leader will lead to broader awareness and perhaps provide women a cleaner path, with fewer barriers, to better quality and more opportunities with true consistent equality in compensation.”
“I don’t know that Biden would have succeeded in winning the Presidency had he not chosen an ethnically diverse female for this role,” Ms. Seenandan says. “His choice shows that more voters are taking more notice as a country―that inclusion and diversity is key to greater success both in business and the broader world stage,” she said. “This election signals that we are entering a new era in leadership, and we expect that companies will continue to pay more attention and take action on bringing more diversity to the workforce. We are watching history shape.”
Rebuilding Global Stature
“The impact of the U.S. elections, assuming the current President accepts the results and steps down gracefully, would vary by country/region,” said Maneesh Ajmani, regional director EMEA at Horton International. “It is widely believed that the current government in the United States has damaged long standing global political alliances that the U.S. had built over the years and the incoming government may take immediate measures to restore/rebuild some of these alliances.”
For a start, he added, “we expect relations with Iran, Turkey and China to improve, which would mean increased business for our clients operating in these markets,” he said. “Similarly, we expect trade with Europe to improve as the political relations between the U.S. and Europe improve. On the other hand, it is anticipated that the democrats will take a tough stance on relations with Russia by potentially increasing sanctions, which might hurt our clients doing business in Russia.”
“Increased cross border trade and improved supply chain movements is likely to have a positive impact on revenues and bottom lines for our clients leading to renewed demand for executive search, however the shift towards technology adaptation will continue to drive the agenda for most of our clients,” Mr. Ajmani said.
Turning Uncertainty into Predictability
“In terms of recruiting, the jury is still out,” said Donna Padilla, managing partner and practice leader, healthcare, at WittKieffer. “There is still a lot of uncertainty with regards to the presidential transition, the control of the U.S. Senate, the future of the Affordable Care Act, and more. The larger issues for recruiting are the state of the COVID-19 pandemic and the health of the U.S. and world economies. If economies recover, healthcare/life sciences companies will ramp up hiring.”
“Regardless, leaders must continue to do contingency planning to account for multiple scenarios which could play out in the future,” she said. “If COVID-19 has taught the healthcare and life sciences industries anything, it is that you need to anticipate varied possibilities, then pivot quickly when a given scenario plays out and change happens.”
“What positively impacts recruiting is a line of sight to stability and predictability,” Ms. Padilla said. Getting beyond the election should bring more stability to the landscape, and that should help recruiting. I wish I had a crystal ball. There is still so much uncertainty around the ACA, the economy, and more. The election is an important milestone, but it doesn’t clarify the big picture for healthcare organizations. For companies working towards a COVID-19 vaccine, I think work will continue as will increased focus on funding important research.”
Hope Springs Eternal
“Certainly, Senator Harris’ elevation to Vice President-elect gives a significant psychological boost to women and minority professionals seeking leadership positions, as well as those in middle management with the talent and ambition who aspire to greater things,” said Nat Sutton, managing director at ZRG Partners. “She wears the mantle of role model proudly and has repeatedly noted that her success serves to inspire girls, women, people of color, and immigrant families.”
“Over the past decade there has been a steady desire by clients and search professionals to build diverse slates of candidates for C-suite positions,” he said. “But the increase in the female CEOs has been painfully slow. The good news is, according to Fortune, the number of female CEOs among the Fortune 500 companies is at an all-time high; the bad news is that that number is a paltry 37. Change in the number of female CEOs has long been a carefully watched statistic, but keen interest has not translated to dramatic change. Whether Senator Harris’s election will spur increased opportunities is anyone’s guess.”
“The example Senator Harris has set gives great hope not just to little girls as they grow up and set career goals, it also vindicates parents who for decades have advised their daughters that they can become anything they want if they study and work hard,” said Mr. Sutton. “She is clearly a believer in, “If you can see it, you can be it.” The symbolism of Senator Harris’s achievement is profound and uplifting. While it holds a promise of greater opportunity for women, it does not automatically assure women will ascend to the C-suite in greater numbers. Senator Harris’s election heralds an impressive crack in the glass ceiling, but I think it is much too early to proclaim it shattered.”
“It is impossible to accurately predict how the elevation of one woman will impact opportunities for female leadership,” Mr. Sutton continued. “Senator Harris will be an indisputable role model for little girls, women and a broad range people from diverse backgrounds. But whether her election ultimately translates to an increase in leadership opportunities for women and more diversity in the C-suite is anyone’s guess. One thing we can say for sure is that over time powerful, successful role models impact society in a variety of ways.”
“I believe that the success of the Biden/Harris ticket is a sign that we are moving toward more opportunity for diversity candidates of all genders, races and ethnicities,” Mr. Sutton said. “Over the past decades we have seen, at least in the political arena, the growth of real diversity—Barack Obama, Hillary Clinton, Nikki Haley, Condoleezza Rice, Susan Rice, Colin Powell, Pete Buttigieg, to name a few. Progress can be painfully slow—especially for talented and ambitious people who feel the sting of bias, whether intentional or unintentional,” he said. “Yet over the past several years we have seen significant, if modest, incremental progress. As an executive search professional, I know that my colleagues and I will continue to consistently advance qualified, talented candidates of diverse races, ethnicities and genders to lead organizations of all types and sizes.
Essential Role of Science
“Beyond the election results and the unprecedented challenges of the COVID-19 pandemic, 2020 has elevated awareness of the essential role that science plays in solving the most difficult healthcare problems of our society,” said Jason Hersh, managing partner at Klein Hersh International. “Extraordinary work is being done every day in the life sciences industry to improve human health. Our work as a healthcare and life sciences executive recruiter puts us at the epicenter of this scientific advancement, helping to build the company leadership teams that turn bold discoveries into the medicines that treat and cure disease.”
“There’s never been a better time to be in our business. Investment in new company formation in life sciences and healthcare continues to surge,” said Mr. Hersh. “Advances in fields such as gene/cell therapy, monoclonal antibodies, and immuno-oncology to name a few is making the need for top scientific and executive talent as critical as ever. We’re true believers in science – always bullish on the healthcare and life sciences sector. We believe 2021 will be a truly great year for the diverse life sciences and healthcare companies we partner with.”
“Science has been the one constant in a year filled with much turmoil,” Mr. Hersh says. “Scientists pursuing the development of COVID-19 therapies and vaccines have worked with a razor focus on the bold medical solutions that put the end of the pandemic in reach. Recent news and developments illustrate the impact the life sciences and biotech sectors have in this fight. We are indebted to the scientists and other leaders in the pharmaceutical industry and at the FDA who continue to work tirelessly to make possible healthier days for all of us.”
A Perennially Divided Nation, for Now
“Presidential elections arrive on our doorstep every four years, and so, too, do they pass,” said Mike Myatt, founder and chairman of N2Growth. “While fiscal/monetary policy can be strongly influenced by the occupant of the Oval Office, it is rarely controlled solely by the President. The political drama of an election year clearly toys with corporate outlook and investor mindset, however financial markets and the broader economy in general like the certitude that comes with the finality of election results,” he said. “Perhaps more critical to the U.S. economy than the party in the White House was the announcement of a 90 percent effective rate of a COVID-19 vaccine by Pfizer and BioNTech. The U.S. economy is strong and has a history of surviving whichever Party wins a Presidential election.”
“If a balance of power is maintained between the House and Senate, I don’t believe the Biden administration will have any near-term impact positive or negative,” Mr. Myatt said. “A divided nation will continue to be governed by a divided government.”
“The U.S. economy was frothy prior to COVID-19 and has experienced the strongest recovery of any global economy to date with good momentum heading into 2021,” Mr. Myatt said. “As we continue to advance vaccines, therapeutics, and other medical treatments, and corporations continue to pivot, workforce dynamics will stabilize, and the U.S. unemployment rate will continue to drop. Near-term growth has less to do with micro-political trends, and more to do with macro-economic trends.”
A Strengthening Market
“With the Republicans most likely holding the edge in the senate we should be safe from any sweeping and massive tax increases,” said Rich Rosen, founder of Cornerstone Search. “That is especially great news for the tech sector where Dems were beating the drum to levy heavy taxes on the major tech firms. In addition to a new stimulus plan getting passed, I see the market continuing to get stronger and stronger.”
“The President gets too much credit and too much blame for the economy and with it the search industry,” he said. “With the market picking up more and more steam since August, I expect it to continue to strengthen. As the vaccine comes to market, and hopefully the country stabilizes, companies and candidates will start to relax and people / companies will get back to hiring for inclusion instead of exclusion.”
“Depending on the vaccine and a stimulus bill,” Mr. Rosen said, “we should see more and more people getting back to work. Companies are already starting to hire in many industries. Longer term, if taxes prevail like his plan has laid out, than we could be in for a slowdown. It really comes down to the senate being able to continue a true checks and balance approach in D.C.”
Biggest Potential: Resurging Green Economy
“Biden’s election brings the fight against climate change back to the forefront again,” said Andy Towne, CEO of Hobbs & Towne, the nation’s leading recruiting specialist in the sector. “The Obama administration stimulus included billions of dollars directed at clean energy and climate-focused technologies. The last administration did everything possible to eliminate that momentum and essentially go backwards,” he said. “A renewed environmental, social, and corporate governance (ESG) conviction has been established by investors globally. We have many big issues in the world today, but no issue impacts mankind more than climate change. Joe Biden understands that impact and urgency in addressing it.”
“Biden will have an enormous impact on renewables and sustainability,” Mr. Towne said. “We have started to see it already in the public and private markets. Over the last 90 days we’ve been hearing from investors and CEOs all over the country. The capital commitment in the category is enormous. The stats we’ve seen are off the charts. With the support of Biden’s policies and green initiative, we could finally have the perfect storm.”
“We’ve been the top ESG, climatetech and cleantech-focused firm in the U.S. for the last 20 years,” said Mr. Towne. “We’ve been growing rapidly to meet the expected market demand. The Biden presidency will impact renewable energy considerably and drive the economy of the future. We can’t move fast enough and great candidates are needed to drive the renewable and sustainable transformation.” And that means very good news for hiring, jobs, and the executive search industry.
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; Stephen Sawicki, Managing Editor; and Erik Boender, Senior Research Editor – Hunt Scanlon Media