This year’s economy has continued to be a job-seeker’s market, with nearly 48 million people quitting a job last year and 76 million taking a new one. Although the labor market currently has 11 million openings, according to recent Labor Statistics data, candidates now have the upper hand with roughly 2 open jobs for every 1 candidate looking. The economic and candidate behavioral changes over the last years has forced recruiters to become more creative in attracting talent.
Here are some interesting trends I’m seeing in the market.
It used to be easy to have your pay ranges keep up with the market but lately, I feel like a character in the move “Catch Me if You Can”. Seems like every time I think we have a grasp on what the market rate is, it shifts another 15%. While I am all about paying candidates what they are worth, which is usually driven by demand, it’s becoming a bit of a free-for-all in some sectors. This volatility makes it hard for recruiters to attract the right talent when we’re fighting to get the talent and then fighting internally to get them paid the (literally) running market rate.
According to CNBC.com, recruiters are fighting to hire by advertising skyrocketing pay bands, throwing out buzzy benefits and putting everything on the table to chase down a candidate. Some companies are offering a Never Return to the Office benefit while others are finally embracing the idea of unlimited PTO. Only two years ago, recruiters could combat counter offers with the line “We’re bringing you in at the top of the pay range,” but that argument is irrelevant because the pay bands aren’t stable enough to have a beginning and end that lasts longer than 45 days in some sectors.
The long overdue discussion around pay transparency has added fuel to the fire. With states like New York and Colorado instituting laws forcing companies to post the pay ranges, candidates have even more bargaining power when it comes time for negotiating offers.
No one is safe
Long time employees are no longer considered “safe”. The market is attracting many to look at their current package and perform a cost/benefit analysis to determine if it makes sense to look elsewhere. Retention has become as hot a topic as attraction for most firms. Long gone are the days when companies could count on those who have given years to the company to stay unless the value proposition is tempting enough to keep them from looking outside the firm.
Companies will continue to conisder reskilling, reverse mentoring programs, and digital training as tactics to help employees keep growing and cultivate a development-oriented culture. There will be more than ever before competition from other employers, changing technologies making remote work easier than ever, and greater opportunities for employees to quit one employer and quickly find another. While it might be too early to know exactly what type of workplace we will have in the last half of 2022, the focus on employee retention will only intensify.
The benefits from focus on employee retention–in terms of increased performance, productivity, employee morale, and job quality, plus reduced turnover and related employee problems–are worth the time and financial investment. When you have an effective retention strategy, the costs you incur in rehiring employees will appear small compared with the results they drive over their entire tenure.
Higher salary and remote work are table stakes for a lot of job seekers these days, so employers are scrambling to offer the latest and greatest, says Paul McDonald, senior executive director for Robert Half. That includes instituting a four-day workweek, flexible work hours (popular among caregivers), paid vacation time with a stipend (attractive in a high-inflation environment), and reimbursements on work-from-home costs like phone and internet bills.CNBC.com
Benefits no longer have the traditional boundaries. Companies have become quite creative in efforts to attract and retain the top talent in the market. While the four-day workweek has been a buzz phrase for the last ten years, it’s actually becoming more prevalent as large companies begin offering this benefit to stop the bleeding internally.
Companies are also changing their job descriptions to lead with benefits and culture first. According to a July 2021 Robert Half survey of more than 2,800 senior managers, 48% are providing signing bonuses, 43% are giving more paid time off and 40% are offering better job titles to attract new hires. Leading with benefit packages is a great way to attract the right eyes on your jobs and tends to provide candidates with a real view of the company’s commitment to culture and its workforce.
Qualifications…. what qualifications?
Qualifications have become less of a barrier to entry as companies finally consider hiring candidates for transferable competencies. CVS changed their education qualifications for front-line workers last year to open the candidate pool. In some tech firms, rather than becoming enamored with the sexy tech college graduates, they are considering candidates who graduate from coding boot camps or similar programs.
As the need for talent continues to grow, I think we will begin to see a shift in how qualifications are not only written but evaluated during the interview process. This will provide firms with a growth-mindset to attract and develop candidates who were once passed over. While this may seem like settling, I like the idea of firms being forced to look at what someone can bring to the company in terms of their competencies versus their black and white experience.
It’s good for the candidates who are trying to break the mold of their career and try something new. And it’s great for companies who are willing to offer candidates that chance.
I honestly don’t see the Wild, Wild West of the talent market slowing down any time soon. Despite indicators of recession, we are still in too much of a talent deficit for negative economic factors to impact the level of hiring we’re currently seeing. If you’re struggling to attract and retain talent, it might be time you look to some of these trends and adapt your strategy to remain competitive.
The new name of the talent game is adapt or die.
and Sprint Recruiting
I joined the HR industry in 2004 after working as a sales leader in the Financial Services Industry for eight years. After spending his first couple of years in HR trying to fit in, I found my voice. Now I leverage all of the things I once hated about HR to become a consultant and invaluable partner to the businesses I support. I contribute to the HRGazzette and to DataDrivenInvestor on Medium. WARNING: my writing style is raw and in your face, not what you would expect from an HR executive.
- Get helpful recruiting tips sent to you monthly!
- Read each chapter of the book Sprint Recruiting as it’s written
- Resources including graphics, reports and training
- Special Q&A sessions to learn how Sprint Recruiting can help you transform your Talent Strategy.