Global Talent #58

Brought to you by Lundi: we design, hire, and run international teams.

🔥 Opening Shot

Every CEO I talk to says the same thing right now: attrition is the lowest it has been in years. They say it like good news.

It is not good news. It is a frozen market.

In July, 3.2 percent of American jobs saw a new hire. In finance and insurance, 1.4 percent. Quits are at 1.9 percent, layoffs at 1.0. Nobody is leaving, and nobody is hiring. The August payroll number looked healthy until you read the lines under it: restaurants and school districts. Information lost 23,000 jobs.

I have operated through a frozen market before. Here is what a freeze actually does to you.

First, your best people are not staying because they are happy. They are staying because nothing is moving. The day it thaws, they leave together.

Second, you cannot add capability. Nobody good is on the market, because nobody good is quitting. Every hire becomes a poaching exercise, and poaching means paying a premium.

Third, and this is the part most people miss: a freeze is when the smart operators redraw the map. Uber did it two weeks ago. Not by cutting remote work, that is the headline. By deciding, function by function, which city each team lives in.

The freeze is a US and UK phenomenon. It is not the world. Kraków, Manila, Bogotá and Ho Chi Minh City are moving, and the talent there is not waiting for your local market to thaw.

When your home market freezes, you do not wait for spring. You build where it is still warm, and you build it in one place.

This Week's Number: 3.2% — the US hires rate in July. Roughly one job in 31 saw a new hire. In finance and insurance, one in 70.

📌 On the Radar

1. The hiring rate just fell to 3.2%. Professional services did the falling.
The July Job Openings and Labor Turnover Survey from the Bureau of Labor Statistics describes a market that has stopped turning over. Openings held at 7.3 million, but hires dropped to 5.1 million, a rate of 3.2% of employment, down from 3.4% in June. Almost all of the decline came from one place: professional and business services hired 188,000 fewer people than the month before, its rate falling from 4.8% to 4.0%. Finance and insurance hired at 1.4%. Nobody in, nobody out.

Low attrition flatters every operating plan: the backfill line goes to zero and the CFO stops asking about recruiting spend. That is exactly when the damage gets done. A team that cannot grow has quietly capped the company's throughput, while 7.3 million openings say demand did not disappear. It is sitting unfilled. Companies that can add capability now, while their competitors are stuck, buy market share on the cheap. The place to add it is a market that is still moving, inside a structure you run properly from day one.

2. Uber cut 10% and rewrote its location strategy in the same memo.
On September 2, Dara Khosrowshahi told Uber's employees the company was cutting about 10% of its team, reducing the number of people seven or more layers from the CEO by 20%, and halving its "micro-teams" of one or two reports. The line that matters for this newsletter is further down. Uber is "concentrating teams in a smaller number of key hubs": global teams in New York and San Francisco, regional teams in regional hubs, local teams in country hubs, tech teams in tech hubs. Managers and their teams are to sit together wherever possible. Only about 1% of employees will be remote going forward.

Read this as a return-to-office story and you miss it. Uber's problem was not that people worked from home. It was that five years of hiring wherever the person happened to live had produced an org with no shape: an analyst in one country, her manager in another, the team she supports in a third. That is the scatter pattern, and it is what any company builds by default when it adds one head at a time through an employment platform. Uber's fix is not bringing everyone to San Francisco. It is deciding which function lives in which hub, and putting the whole team there with a manager who runs it. A team is a place, a manager, and a P&L. Ten people in ten countries is a mailing list. You do not need Uber's headcount to apply the rule. You need to pick the hub before you hire the first person.

3. Manila is now pitching the mid-market directly.
On September 8 the IT and Business Process Association of the Philippines launched a coalition of advisory firms, developers, banks and investment agencies to bring more global capability centers to the country. Two things are new. The targets are the UK, Australia, Japan and the Middle East, explicitly to reduce dependence on US clients. And the pitch is aimed at mid-market companies and at banking, insurance and healthcare operations, not just the multinationals that built the industry's $40.3 billion and 1.9 million jobs. Advisers will put the Philippines into their location recommendations; developers will supply GCC-ready floors; banks will work their client lists.

For twenty years the Philippines sold outsourcing: you send the work, a vendor's people do it. This coalition is selling ownership: your team, your floor, your P&L, in Manila or Cebu. That is the right product, and the one a 300-person company in Leeds or Denver actually wants. The catch is that a mid-market capability center is thirty people, not three thousand, and nobody stands up an entity, an employment stack and a management layer from scratch for thirty people. The mid-market GCC only works if someone builds and runs it for you first, and hands you the keys once it is worth owning. Start with an employment partner, put the team in one place under one manager, and treat ownership as the reward for a team that has proven it should exist.

📊 Chart of the Week

The freeze is not evenly distributed. Restaurants and construction sites still turn over 4% to 5% of headcount a month. The functions our readers actually build, finance at 1.4%, information at 2.4%, professional services down to 4.0% from 4.8% a month earlier, are where the ice is thickest. Those are exactly the roles that travel well. If you need ten of them this quarter, the US market is telling you where not to look.

🚀 One More Thing

A frozen market gives you one gift: time. Nobody on your team is going anywhere for a few months. Use that window to decide, calmly, where your next ten people should sit, what they should cost, and who should run them. If you want a second opinion on that map (which market, what structure, what it will really cost against your current model), book a strategy session and I will walk you through how we think about it. No pitch. Just insight from someone who has been there.

📖 New here? My book, Winning the Global Talent War, is the full playbook behind this newsletter.