It’s easy to say that over the last few years the global recruitment industry has been amid a talent shortage “epidemic.” Of course, the covid-19 pandemic majorly contributed to the ever-shrinking pool of talent, but it’s not the only culprit. Today, there are hiring signs and job listings everywhere you look. This observation naturally begs the question, “Everyone’s hiring, so why are so many of these businesses left understaffed?” The answer to that isn’t as confusing as it may seem, but it gives recruiters (and businesses) a reason to step up their game as we continue to wade through a seemingly endless talent shortage.
By now we’ve all heard of The Great Resignation, a recent wave of workers willfully abandoning their positions. In 2021 over 38 million workers quit their jobs in The United States alone smashing national resignation records. This phenomenon isn’t only seen in The United States, however. In fact, we saw similar trends throughout several Western European countries, and even Japan in the same year. But why?
According to Manpower Group, businesses got their first taste of the global talent shortage in 2006. Through their research, they found that 40% of businesses struggled to fill positions due to a lack of qualified candidates. During the 2009 global recession, while millions were left without a job, 30% of businesses still found themselves struggling to find talent that had the skills to qualify them for open positions. Fast forward to 2020, over 114 million people worldwide lost their jobs due to covid-19 due to safety restrictions and lockdown procedures.
But now that businesses have opened back up in 2022, why are we still seeing low employment rates? Why is it that only about 56% of working-age people are employed? What about all of those hiring signs and job listings?
In years before the pandemic, the main issue surrounding the talent shortage was simply the lack of qualified talent, but covid brought light to many of the issues workers have dealt with for years. Some of these problems include failure to meet specific job qualifications, unsuitable wages and benefits, and over-demanding work environments. All things considered; top talents are now the ones holding all the cards.
Candidates are getting picky about who they choose to work for which can be troublesome for recruiters trying to satisfy their clients. On one hand, top-talent are demanding better accommodations across the board, but on the other, many companies have been reluctant to alter the status-quo to meet those accommodations. For in-house recruiters and recruitment agencies alike, this presents a great challenge. Being unable to find a placement that meets clients’ expectations damages agency success rates, causing clients to begin questioning their relationship with them. Meanwhile, in-house recruiters have the pressure of trying to explain to managers why there isn’t talent available to meet their expectations. Recruiters are amid a hiring gridlock, but something has to give.
The reality is, there is talent out there ready and willing to take up a new position, but companies have to meet them halfway. Businesses have already started to make changes to adapt to the expectations of quality talent looking for new work opportunities. Many of these organizations have increased employee base pay to a livable wage, and while doing so definitely increases their chances of hiring success, it’s not enough to attract and keep workers.
The pandemic brought the possibility of remote work for previously in-office positions to light, allowing employees to work efficiently from the comfort of their own homes. According to a study by Growmotely, remote work is the biggest draw-in for top talent with 97% of employees preferring either a fully or partially remote work option. Those who prefer working remotely say that they are able to have a better work-life balance which significantly reduces stress levels and increases productivity rates. For employers, this means that giving employees the option of working remotely will significantly increase their appeal for top talent. Benefits (or the lack thereof) can be another deal breaker for quality talent. The reported top three benefits that employees look for include professional development, healthcare, and coaching opportunities. Today’s employees want more than just a place to work, they’re looking for employers that value professional growth and development as well as their mental and physical wellbeing. Businesses could increase their hiring rates by providing better healthcare policies and upskilling new and existing employees to better equip them for their work responsibilities.
The talent shortage put recruiters in a tough spot. With both candidate and employer to please, it’s difficult to find placements that align perfectly with the demands of each party. As more businesses begin to realize that getting around the talent shortage is dependent on how they can better accommodate their employees, recruiters will have an easier time placing candidates in positions that they’ll stay in for the long term.