If you’re looking for a job, is it important for a recruiter or HR person to know whether or not you're currently employed?

Important to whom?

The HR/Hiring manager: When I hire/interview, it is a talking point I almost always cover. It is not that being employed or not is all that important, but there are a lot of situations around employment status that I like to touch upon. But, that is just my opinion.

Recruiter: On the surface, it is important because they have to be careful who they take from. It isn't good for their business relationships if they are pulling from a company that they are also placing at. Also, I think there is a different pitch to be made on the candidate’s behalf, based on employment status. There are several that keep current on Proformative, so they can give you a more detailed explanation.

In my experience it never pays to lie to or mislead a recruiter or potential employer. They are going to find out sooner or later, and the consequences are far too severe for the reward(if there is any). Plus, the good recruiters are like a mini-career coaches (that someone else is going to pay!). So give them the best information and let them help you with working through any potential blemishes on your record instead of trying to hide them. I should note, not being employed isn't necessarily a blemish, particularly in this economic climate.

If you have been unemployed for over 6 months recruiters cannot place you because they are told by their clients to only present those currently employed or recently unemployed. It is a form of discrimination and since recruiters are not employers, they are brokers of human capital, none of the laws apply to them, so companies can get around the rules easily and since the recruiter is outsourced, management can claim they are unaware of any such instruction.

Internal HR people will want to understand the drivers of lack of employment as the previous person mentioned because it goes to your personal motivation and personal decision making choices. There is no mercy given if you live in a city where unemployment is high due to the economy. You must have an acceptable answer and it usually involves one of the 12 acceptable reasons, that you can find using Google.

HR exists to keep you out unless you can prove you indeed make a difference. Prepare your value proposition, your press kit, and be armed for bear, because that is what it takes today. You are now required to do your own business development to obtain a job and nothing less will do. You won't get a job based on past results or because you are smart or have multiple degrees.

Best.

It is important for them to know, and important for you to let them know, because it will come out. If it comes out late in the process, they will see it as a red flag (both the fact and the delay of disclosure, along with lack of disclosure management) and it will imperil your candidacy.

The only way to handle it is, per Valerie and Chris, is to actively manage the disclosure so that it is seen in an appropriately favorable light.