Thrive’s Q2 executive search report analyzes executive searches across various industries and functions. The data focuses on how Q2 2020 performed within the following four KPIs: opened, held, canceled, and completed executive searches. These metrics can be adapted to both external and in-house executive recruiting functions. To download the full report, click here. Halfway through 2020, it may be hard to remember how much optimism existed at the start of the year. In partnership with Hunt Scanlon Media, Thrive conducted a survey in January that found 90% of executive search leaders expected growth for their firms. After the outbreak of the COVID-19 global crisis, an additional survey revealed that nearly 80% of exec search leaders said they don’t anticipate growth for the remainder of the year. By the end of Q1, Thrive’s executive search data validated this dreary outlook. In the last week of March, canceled and held searches increased by 766% and 340%, respectively. However, as we examine data from the second quarter, it seems that recovery could be closer than we think. Opened searches—the most important financial indicator for executive search—surged in June, and completed searches could soon follow suit. Many industry leaders we’ve spoken to say the search cycle seems to be moving more efficiently, despite unprecedented working conditions. In this piece, we’ll examine the biggest takeaways from our second-quarter report and discuss what they might mean for the latter half of this highly volatile year. Top funnel starts to rebound, bottom lags behind The initial impact of COVID-19 was devastating for the executive search industry, but some key performance indicators bounced back before the end of June. Overall in Q2, opened searches were down 22% and completed searches were down 29%, year-over-year (YoY). While both figures are cause for concern, a closer examination of opened searches actually reveals the first significant sign of recovery. Opened searches were down dramatically at the start of the quarter, but in May improved 22% month-over-month (MoM). We predicted that continued MoM growth would bring the industry back to average performance levels in June. To our surprise, the results exceeded that expectation when opened searches soared 13% YoY in the last month of the quarter. This metric is an early, but important, indicator of a possible recovery, as it shows companies are ramping up executive hiring after months of slowed activity. On the other hand, completed searches have yet to see such a rebound. Though the metric did increase every month in Q2, the YoY results are not improving at the same rate as opened searches. This isn’t necessarily troubling as there are a handful of factors at play. First, with fewer searches opened earlier on in the quarter (-40% in April and -35% in May), there were simply fewer searches to close. Similarly, drastic increases in held and canceled searches had a big impact on driving down the number of completed searches. As these metrics continue to level off as we observed in the latter half of the quarter, completed searches should continue trending back up towards average levels. And lastly, both hiring teams and candidates felt overwhelming uncertainty earlier in the quarter. While these sentiments cannot be captured in the data, conversations with dozens of exec search leaders confirm this was certainly an influencing factor. The good news is that we seem to be on the right track. Opened searches have surged, held and canceled searches are at acceptable levels, and the initial shock and uncertainty has lessened across the board. This could very well lead to the bottom funnel filling out in the coming months. Oddly enough, search cycles accelerate The glaring barrier for executive search at the start of the crisis was moving searches along virtually. Social distancing still remains a challenge for many executive search teams, as in-person interviews are a fundamental, and expected, step of executive hiring. On the other hand, some executive search leaders reported feelings that their search processes became more efficient—particularly those that were proactive about leveraging technology. During Thrive’s peer roundtable sessions, we often heard accounts of executive recruiters having an easier time getting in touch with candidates, coordinating virtual interviews, and getting timely, quality feedback from hiring managers. Thrive’s executive search data seems to support these observations. Despite the unprecedented circumstances, second-quarter searches were completed 5% faster this year than during the same period in 2019. A 5% search cycle delta in pre-COVID times wouldn’t have raised too many eyebrows. But this finding left us searching for an explanation. Have executive search firms really been able to increase efficiencies while working remotely? If so, firms might come to the realization that not every meeting needs to be face-to-face, and this could, theoretically, short-circuit a lot of traditionally slow business processes in a post-COVID world. Or is it a combination of pent up demand and pre-COVID efforts, expediting the latter half of some executive search timelines? “We’ve seen searches that were active pre-COVID get put on hold, but were easy to pick back up when the client was ready,” reports Joe Riggione, co-CEO and founder of True Search. “In many of these cases, we already had quality candidates in the pipeline and in-person interviews completed.” If that’s the culprit, we might expect to see search cycles take longer than we observed in Q2 as net new business continues to pick up. Regardless, Thrive intends to keep close tabs on this metric for the remainder of the year before jumping to any conclusions. Too soon to call it a comeback Though COVID-19 quickly dashed positive expectations for the year in the first quarter, there are now reasons to remain hopeful for a strong recovery. It’s still too soon to say executive search is in the clear, but the Q2 report gives every indication that we’re headed in the right direction. To get Thrive’s entire quarterly recap, download the full report here. The in-depth analysis expands upon the findings we’ve shared in this post, contains further insights into how specific functions and industries were impacted, and eludes to when we might be ready to claim a full recovery. As we trek down this (possibly bumpy) road to recovery, Thrive will continue sharing this data quarterly to provide actionable insights for the executive search industry.