Attract and Retain Talent
Competing For Talent Can Be A Challenge. HCC Can Help.
Chances are, your company has a few job openings that are contributing to the more than 10 million unfilled jobs nationwide. With over 6 million Americans unemployed, it seems that the supply of talent does not meet the demand for talent. Employment trends are showing that the talent shortage that came to life during the pandemic is here to stay for at least the foreseeable future. With more people leaving the workforce than joining the workforce, your company and others are yoked with a labor shortage problem dominating the headlines for being both unexpected and seemingly unexplainable.
Companies developing strategies that reflect the ever-changing workplace landscape are more competitive in the hunt to attract and retain talent. This shift, however, makes it increasingly necessary for employers to build a strong framework for remote working teams. Understanding the complexities of the talent shortage will help you pivot your hiring strategies while making your company stronger in a volatile economy.
Talent Shortage Is Years in the Making
Prescient forecasters have been warning of a talent shortage for years. Even before the pandemic, 45 percent of employers struggled to find skilled workers. Surprisingly, many in-demand jobs with labor shortages were those that didn’t require a college degree, such as skilled trades, drivers, and machine operators.
At the highest rung of educational achievement, skills haven’t matched demands as universities produced more Ph.D.s than the country had jobs to employ them. And at the lowest end of the educational ladder, the working class has experienced pay cuts and less access to skill training. Throw in the rising costs of college, and it’s easy to forecast a shortage of talent with the skills to match the available jobs.
Skills mismatched with wages aren’t the only deterrent to a strong workforce. The past decade has seen a steady decline in worker benefits. According to a 2018 Pew Research Report, fewer workers “receive health or pension benefits in 2015 than they did in 1980.” And industries seeing the most drastic shortages now traditionally have the lowest employee satisfaction, such as the hospitality sector, where workers report low wages, hours non-conducive to family and social activities, and emotional exhaustion.
Of course, the economic conditions that adversely affect workers also affect the companies hiring them. Globalization, rising healthcare costs, and fluctuating regulations all contribute to an ever-increasing human resources burden. Forced to navigate an ever-changing labor landscape—such as the many iterations of the Affordable Care Act to OSHA’s shifting policies on COVID-19—companies shift their budget resources away from core business activities to juggle a ballooning human resources department.
Many different factors can come together to create a “perfect storm” that results in a talent shortage and increased competition for the best and brightest employees.
Pandemic Created the Perfect Storm for Worker Shortage
Covid-19 entered the economic scene against the backdrop of this labor landscape. In fact, the pandemic stole the show, so to speak. The virus that halted the world’s economy and brought devastation to millions understandably occupied everyone’s minds.
9.6 million Americans lost their jobs during the pandemic. According to Pew Research, a quarter of all households had a member of the home lose a job. A third of all households took a pay cut or a reduction in hours. Many of these households had trouble paying their bills. Roughly 15 percent of households needed to borrow money from family or receive food from a food bank.
The numbers were so dire that one has to wonder why these workers aren’t returning to work in droves.
The usually named culprit is the unemployment insurance supplement. Again, the data is nuanced. According to one talent shortage statistics study, 14 percent of recipients were getting more money from unemployment benefits than they were from their most recent job. Jobless claims fell faster in states that ended the $300 unemployment insurance supplement. But even a dropping unemployment rate still doesn’t come close to returning people to the workforce at pre-pandemic rates.
A shift in worker demographics as baby boomers retire is compounded by a shift in what’s important to younger workers who want better work-life balance and focus on company culture, as well as a shift in the skills required by the job market. These factors have all had a major impact on how organizations approach HR management.
Companies have very little control over economic inflation and rising insurance rates. Meanwhile, talent is seeking higher salaries, more flexibility in schedules and remote work options, and a safe work environment. The good news is that employers have more control over many of the factors that top talent is looking for in their next opportunity. Many of the benefits workers need are actually cost-effective for employers to implement.
Overcome a Talent Shortage with Build, Buy, Borrow, and Bridge
“Build, Buy, Borrow, and Bridge” is a multifaceted strategy to overcome a talent shortage. It refers to steps you can take throughout your organization to ensure you have workers with the skills they need for success.
Build means implementing a robust skills training and development program for your existing employees. Upskilling current employees is more cost-effective than hiring new workers. You can onboard current employees for a new role more quickly because they already understand the company and its culture. And by investing in their future, you’ll earn your employees’ loyalty.
Buy means creating a workplace that is attractive for job candidates. In a sense, “buy” means offering competitive wages and benefits. But it means so much more. Understanding what the best talent is looking for in terms of culture and purpose will help you attract the best new hires.
Borrow means looking outside the company for freelance or contract workers to work on short-term projects. Whether you need specialized skills for a short period of time or you need someone to fill in during the busy season, temporary workers can fill the gap.
Bridge is similar to build. But instead of focusing solely on the skills the company requires, bridge focuses on the employee’s future. If a position becomes obsolete, “bridge” asks how we can help the employee transition to a new position, even if this position is outside of the company. Treating employees—even former employees—with respect strengthens your brand.
Looking for actionable ways to overcome a talent shortage. Find out HCC’s six-step strategy for successful hiring.
Attract Talent with Health Safety Protocols
Many experts agree that workers stayed home out of fear of contracting Covid-19 during the pandemic. As the Covid-19 pandemic moves toward an ongoing endemic, 59% of those with jobs that could be done from home were working from home all or most of the time – much higher than the 23% who say they teleworked frequently before the coronavirus outbreak. With the continued threat of another surge in infections, and the possibility of other health risks, the most important thing you can do as an employer demonstrates that you care about your employees’ health.
Flexibility in the workplace can be a good strategy to attract and retain talent. A hybrid workplace structure that allows employees to spend some time on-site and some time working remotely can be a good solution. Remote work, and the employees who do it can be a boon for your company. By understanding how to properly manage and support remote workers, and providing the flexibility that makes a remote or hybrid workplace more attractive, you can attract and retain your employees, ensuring that they’re engaged and productive while also realizing greater cost savings than ever before.
Invest in a Happy Workplace to Overcome a Talent Shortage
Lack of childcare is one of the most cited reasons for the post-pandemic worker shortage. Childcare woes are just part of a larger issue surrounding employment satisfaction. Prior to the pandemic, many employees missed out on work-life balance and other factors that lead to a happier workplace. Employers that fail to consider their employees’ happiness won’t earn their loyalty when a crisis happens.
Accommodating employees who are struggling with childcare issues is the first step to creating a less stressed, happier workplace. Consider offering remote or flexible schedules. Consider offering flexible spending accounts (FSA) that allow parents to pay for childcare with pre-tax dollars. You may qualify for tax breaks if your company subsidizes the FSA program.
Other ways to create happier—and more loyal—employees include implementing a rewards program. Public recognition and a prime parking space are inexpensive, yet effective, ways to recognize employees’ extraordinary efforts. Make sure employees know you value their work, especially in industries that are traditionally undervalued.
A Happy Workplace Does More Than Attract Talent
Prior to the pandemic, a majority of employees were not fully engaged in their work. In fact, two-thirds of unemployed workers considered changing their occupations during the pandemic. The most obvious cost of this disengagement is workers’ sluggish return to the job market.
But companies have been shouldering a larger, hidden cost of disengagement and general employee unhappiness. Disengaged employees have higher absenteeism, more accidents, and more errors. And organizations with unhappy employees have lower profitability and lower productivity. And when workplace stress increases voluntary turnover by nearly 50 percent, the current work shortage makes a bit more sense, especially when coupled with the stresses of our rapidly evolving society.
You can have a happier workplace and lower employee turnover by using a PEO. Companies that use a PEO have 10 to 14 percent lower employee turnover and are 50 percent less likely to go out of business. We’ll show you how.