The term ‘recruitment crisis’ is increasingly being used to describe the current candidate demand and supply issues facing many sectors in the UK. Here we take a look at some of the factors contributing to the situation, and what you might want to consider to mitigate the effects on your business.
What we know
While both UK and Irish economies undoubtedly suffered during the pandemic, they have bounced back more quickly than expected and are predicted to return to pre-pandemic levels by early 20221 and the end of this year2 respectively. Where businesses were grappling with reducing hours, utilising furlough and wage subsidy schemes, and in some cases making redundancies, job vacancies are now on the rise.
Inflation is also rising, particularly in the UK, as a result of increasing energy prices and the challenges affecting many supply chains, shortages of materials, products and drivers to move them around. It’s also being influenced by the support for businesses that governments provided during the pandemic, beginning to be withdrawn.
A recent report by the CIPD looking at this topic3 identifies that the incidence of labour shortages in many low-paying sectors is actually not more prevalent now than before the pandemic. However, this doesn’t take away from the significant scale of it, or how Brexit is now compounding it; the ONS estimates that there were 38,000 fewer EU-born citizens working in the UK in Q3 2021 compared to the same period in 2020. Manufacturing, hospitality, health and social care and farming have been particularly affected, but shortages are beginning to affect most sectors and are putting pressure on a broad range of businesses4.
Some employers have been offering higher wages in response to labour shortages, but for many this isn’t a viable option for their business model particularly with other costs rising. As part of the autumn budget, the UK chancellor announced an aspiration to have a high wage, high skill economy and included a provision to increase the National living wage by 6.6% to £9.505 in support. In Ireland the increase will be 3% taking the minimum hourly rate to €10.506. Whilst good news for employees, it adds a further burden to employers already trying to balance increased energy and material costs.
‘Flexible’, ‘hybrid’ and ‘remote’ working are now all very much part of our collective vernacular thanks to the experiences of the last 18 months. While some are keen to return to an office-based, pandemic style of working, others do not want to relinquish the balance that a new way of working has provided, and see this as non-negotiable in a new role. Organisations that are not well set up to cater for this relatively sudden change in working environment may find themselves struggling to attract and retain staff.
What can you do
Define a strategy
While many of the factors outlined above are outside your control, developing a clear recruitment and retention strategy that’s tailored to your business and sector will help you respond appropriately. It will give you a blueprint to work from in tackling the specific challenges that your operations may already be facing or are likely to face in the near future. It will help you to make proactive targeted investment decisions and avoid costly reactive spending at a time when your P&L may already be under pressure. In defining your strategy, it may be helpful to consider the following questions:
- What is your USP (Unique Selling Point) as an employer?
It might be your culture, benefits package, working environment, brand, a combination, or something else entirely! Understanding what’s attractive about working for your business means you can leverage it both internally and externally to promote why someone should stay, or take this role rather than one with a competitor.
- Are you able to offer permanent rather than temporary contracts?
Official data shows that during the course of the pandemic, temporary roles increased by 9%, while the proportion of the workforce seeking a permanent role rose by 34%7 . If it’s something you’re able to offer, it’s likely to prove attractive to a good number of prospective candidates.
- What does flexibility look like in the context of your organisation?
It’s tempting with so much focus on this topic in the media to make assumptions about what you ‘should’ be doing rather than what would add value and be realistic for your operation and team. With so many looking for flexibility in their work, demonstrating a willingness to offer it in some form is likely to be advantageous.
- Are there opportunities to multi-skill or offer other forms of progression?
Multi-skilling can be beneficial in creating more options within your operation for covering critical work. It can also provide attractive learning and development opportunities; another factor that may well influence someone’s decision to stay or to join your business.
- Are there any unexplored or underutilised options for sourcing candidates?
Whilst historically your preferred option for sourcing staff may have been through a recruitment agency or certain job sites, different times may call for a different approach. Depending on the nature of the roles you are looking to fill, there may be considerable value in building relationships with schools or colleges in your area. Another potentially underutilised option is apprenticeships. As well as enhancing the learning and development opportunities available in your business, you may be able to secure additional funding from the government to support them. To find out more about apprenticeships in the UK and
- How will you communicate?
One of key the changes in how we communicated during the pandemic was the increased reliance on technology to facilitate it. Spending more time online has meant that for many of us we have less tolerance for things like lengthy screening or problematic onboarding processes . Employers who are able to create effective, streamlined application and onboarding processes are more likely to be able to gather and retain a larger pool of candidates for roles. Finally, consider where you could leverage two-way communication to gain valuable insight from your team and candidates on what’s great and what could be improved. This is particularly important from a retention perspective – employees who feel that their views are sought and acted upon are more likely to feel valued by the organisation and thus to continue to work there.
How can we help
If you need some help defining your recruitment and retention strategy or if you have a specific recruitment issue you would like some support with, don’t forget you can contact us at any time by calling 01280 875220 (UK) or 086 885 9151 (ROI) or emailing [email protected] or [email protected].