UK recruiters and businesses are experiencing both skill shortages and also elements of the big resignation. How did we get here?
The phrase ‘perfect storm’ has been used extensively by the UK media in reference to food and fuel shortages, but it is also relevant to the job market. A combination of changes brought on by the pandemic and Brexit are accelerating what ManpowerGroup has identified as ‘the skills revolution’. In the skills revolution, four trends are driving changes in the workforce: changing demographics, technological revolution, greater individual choice and increasing customer sophistication. These strengths are driving organizations to be more agile and to rethink the way people and businesses interact and work – and this is increasingly the case in today’s climate where talent is in high demand. This for several reasons:
• Companies that contracted during the start of the lockdown but have rebounded strongly this year are creating new roles that need to be filled.
• Candidates and employees have learned a lot through remote working about how and where they want to work, and they have developed a strong awareness of their life priorities during the pandemic.
• The economic rebound and the growth of hybrid work mean that employees are more selective about where they choose to work and are offered far greater opportunities than before.
• In addition, Brexit means that there are fewer European workers available to fill jobs.
All of these issues and circumstances have played a huge role in creating talent shortages.
Besides improving the skills of the current workforce, what other strategies can companies put in place to address the skills shortage?
ManpowerGroup has developed an approach to help organizations recruit and retain more workers and reduce talent shortages for businesses: build, buy, borrow and bridge.
Building is about improving skills and investing in learning and developing your current workforce – retention is essential when competition for applicants is fierce.
Buy will market to find the best talent that cannot be created in-house within the required time frame. Here, a proactive approach can pay off. Get in touch with people who aren’t necessarily looking for a job, but who can be persuaded to change employers if presented with the right opportunity and offer.
Bridge helps people grow and move into new roles inside or outside the organization. It demonstrates staff appreciation and shows them that you recognize their value, which is an integral part of building relationships. Likewise, take a look at those who work in industries closely related to yours and see if there are any candidates out there who may have the transferable skills you need.
Borrowing is all about cultivating talent communities outside the organization, including part-time, freelance, contract and temporary workers who complement the existing skills of your workforce. The flexibility they offer not only solves a short term solution, but in the long term some of these people could become permanent members of the team.
In your experience, are companies finally realizing the importance of investing in improving performance?
What are the prospects for 2022 and beyond? Do you see a positive job market?
The latest ManpowerGroup employment outlook survey, which asks UK employers whether they intend to hire additional workers, maintain the current workforce or downsize their workforce in the next quarter, reveals that employers have ambitious plans to increase their workforce at a record pace when they enter the fourth quarter, and this trend is expected to continue through early 2022.
More than a quarter of employers raise wages to provide incentives to fill positions, but we need to see a comparable increase in productivity to sustain these wage increases. Some employers look to other benefits to attract new workers; we’re seeing plenty of offers of membership bonuses, additional annual leave, enhanced training opportunities, and hybrid work options – such as employees choosing their own shifts. These non-financial incentives are particularly popular in industries such as hospitality and retail where profit margins do not allow for large pay increases. However, some of these changes are not sustainable as a long-term solution to filling the talent gap.
The long-term solution to the talent shortage must be to retrain the existing workforce and develop newcomers. But these changes don’t happen overnight, it can take some time to learn the skills you need in an economy. In the short term, we need to put in place a migration system that helps us meet the immediate needs of our economy and allows us to “buy” the skills that are in demand. If these adaptations take place, the outlook for 2022 could be very positive – with a happy and productive workforce, resulting in a win-win for all.
Chris Gray is Director of ManpowerGroup UK