The importance of investing in recruitment is irrefutable despite current economic uncertainties such as trade with the EU, the pandemic, and climate change. The collective conscience has questions: how will trade and border control with the EU be affected long-term? What will be the fallout from the global pandemic and how will this effect employment? As the world looks at international environmental policy, tensions with Russia and China continue to cause anxiety, and world leaders grapple for power, how will this provide stability for businesses to grow?
So then, why is it important for employers to invest in recruitment at a time like this? Studies show that it pays! Employee retention rises as does productivity and profit. Let’s take a look at three points of investment: training, wages, and perks.
Human Resource professionals report lack of training as a reason for new hirers to hand in their resignation. People want to be good at what they do and when they feel they simply can’t pull their weight in a new role it damages self-confidence and leads them to being back on the job market. Initial training is important, however so is ongoing training and development opportunities. Employers often feel that investing in developing their people will only lead to loses as those staff will take their new skills to another employer. Luckily however, studies in fact show the opposite. Training increases employee retention. This again goes to the notion of self-confidence – employees want to be good at what they do and feel valued.
At the time of writing, the UK national living wage is £8.91 per hour however the “real living wage” is £9.50 (£10.85 in London). An article from Loughborough University tells us that almost 30% of UK families cannot afford a minimum standard of living and therefore cannot participate fully in society. This is some food for thought when offering young professionals the lower end of the salary range. Perhaps employers would save more in the long run by retaining new hires starting on slightly higher salaries rather than spending more time and resources hiring over and over for the same position.
Google is well known for being a great place to work. Their Toronto and New York offices frequently send employees to and from to teach their fellow colleagues on things like management and public speaking. This sounds costly but apparently, it’s paying off. They also offer their employees perks such as fitness club memberships and other extracurricular classes. This is breeding loyalty and overall job satisfaction.
Since the start of the pandemic many of us have had to adapt to home working which has allowed us to work more flexibly, spend more time with our families and balance our lives differently. Some studies have shown that productivity has increased. Early indicators also show that staff retention levels have also increased when flexible working has been adapted as a long-term change. With this in mind many businesses are offering hybrid working patterns to allow people to return to the offices to allow them to attend meetings, training and interact with colleagues but also allow them to work from home giving them more flexibility.
Employers have for the last decade been reporting an increased difficulty in finding “right-skilled” workers. It seems that employers are beginning to take on the training and development philosophy according to Man Power Group, 53% of employers “train-up” their current workers and this is an increase from 1 out of 5 organisations doing so to 2.5 out of 5.
Retention is higher, employers are taking care of their employees. This is a positive but it is also contributing to the talent shortage simply because fewer highly skilled workers are searching for a new job. This is where the importance of investing in recruitment comes in. People are staying put. So, when you find the right talent, consider making some changes to your company’s norms in order to keep them.
Also, foreign labour is decreasing due to Brexit and the changes to free movement between the UK and Europe. Prospective skilled labourers may not come here due to predicted hardships and uncertainties. This is impacting employers as UK employers hire many foreign skilled workers. According to Migration Watch, a 2015 study showed that of the 400,000 foreign workers in the UK 70% were likely to be in skilled job vs. the UK where only just over half of the population are classed as skilled.
Surely all of this is up for debate. It is interesting to think that for employers the negative impact of the talent shortage can be counteracted with training and development, increasing wages, and offering unique perks – however, this in turn increases the talent shortage because as you, the clever employer are recruiting and retaining more talent your competitors are having trouble filling the skill gap because less workers are looking for jobs.
For a visual description of the talent shortage at a glance, click here https://www.manpowergroup.co.uk/the-word-on-work/infographic-uk-workers-want-2020/ , provided by Man Power Group.
Real Living Wage https://www.livingwage.org.uk/what-is-the-living-wage?gclid=EAIaIQobChMImtfSxcaD1QIVCLftCh0p1QiEEAAYASAAEgJBnfD_BwE
Training improves retention https://trainingmag.com/content/training-increases-employee-retention
The Google example https://www.fastcompany.com/3007369/heres-google-perk-any-company-can-imitate-employee-employee-learning
European Skilled Labour https://www.migrationwatchuk.org/briefing-paper/364