HR Under Pressure as Australian Talent Market Heats Up
A recovering economy and increased competition for top performers are ratcheting up the pressure on Human Resource leaders across Australia as companies continue to balance cost control with the need to invest in growth and the talent to drive it.
Concerns about engaging employees and retaining critical talent are top of mind for an increasing number of organizations, according to a recent Mercer survey, as businesses in many industries look to productivity and leadership to help them emerge from the stresses of the Global Financial Crisis (GFC).
Mercer, the global consulting firm, finds that more than one-quarter (27%) of participating organizations are expanding their overall workforce, while only 3% have instituted broad-based staff reductions. And a recent Accenture survey reveals that more than half of business executives it polled in Australia and around the world plan to rebuild their workforces to pre-GFC levels by 2012.
Yet, to put the Australian mandate for top talent into context, consider that the demand for high performers in a variety of job functions isn’t only a factor of new job creation, but also, current and anticipated hiring to counter the effects of significant career and employer disaffection.
Demand for Talent
Rebecca Houghton, National Recruitment Manager for health insurer BUPA, which does business in Australia under brands including MBF, HBA and Mutual Community, confirms that the increased demand for talent in Australia is already shifting the rules of attraction.
"There is definitely a sense of "hotting up" in the Information Technology, Finance and Recruitment sectors with most candidates having another offer already in hand when receiving one from us," Houghton says.
Given that many candidates have been hunkered down in their current roles for at least the past 24 months, it seems that those now willing to consider career transition are exploring their options in a very purposeful, calculating manner, lest they lose the employment security they’ve until now considered a shelter from the GFC storm.
This has significantly elevated the level of due diligence the best candidates are performing on potential employers. It is also increasing the pressure on Human Resource leaders who are poised to meet business partner talent needs but who are still hampered by budget controls and ineffective talent management processes.
"As companies grow their staff, it is more critical than ever that they understand their skills needs and approach the expansion of their workforces strategically," says Accenture’s David Smith.
With so much at stake from both a recruitment and an engagement and retention perspective, adds BUPA’s Houghton, now is the time for Australian employers to drive the HR change required to deliver consistent talent results before the competition for talent here intensifies.
Despite efforts to engage employees during a difficult year, organizations have growing concerns about whether their valued employees will stay once the economy recovers.
Almost two-thirds (62%) of companies believe that voluntary turnover will increase as the economy and job market continue to improve. Moreover, Mercer’s survey shows that certain positions are more sought-after than others because of skill shortage or market demand. These roles include R&D/scientific engineering and sales, followed by information technology and executives/top management.
"Typically, engaged employees are less likely to seek job opportunities outside the company and therefore, have a more positive impact on both individual and business performance," says Mercer’s Loree Griffith.
So how are Australian professionals defining engagement and employer synchronicity?
"Opportunity and personal development are really high on the list of candidates’ [career deliberations] these days," Houghton says. "And for the first time ever, according to industry research, it has surpassed bad leadership as the Number One reason for leaving, too."
Houghton explains this may be a response to the lack of movement due to the GFC, and may normalize again over the course of the year as people satisfy that desire to grow in their next role and find real career and personal fulfillment from their work.
"Personally I hope [advancement and development] remains high on the candidate wish list - it's something we do really well!" Houghton says.
Corporate Social Responsibility
Beyond the fit of candidate and employer growth opportunities, however, come considerations about corporate social responsibility (CSR) and how a potential employer’s values line up with the individual’s.
"Social conscience is a very interesting one, as a business of our size with no shareholders, we have a pretty good CSR profile but it is of interest to segments that come as a slight surprise -- not from our Gen X’s, but from our professional segment, mainly Gen Y’s," Houghton observes.
For Australian HR leaders, the combination of shifting candidate expectations and the need to balance workforce growth with existing resources and budgets is raising the bar on performance.
Says Mercer’s Griffith: "By identifying talent needs necessary for future growth, employers can implement the appropriate steps for developing employees internally or hiring staff externally."
"Competition is keeping me up at night," says BUPA’s Houghton. "It’s going to a fierce year for everyone now the post-GFC floodgates are open. It's like a tsunami effect, so we all have to prepare ourselves for it as best we can; faster processes, more accurate selection, greater emotional connection and more a compelling, better articulated offering."
The best way to face that tsunami, Houghton suggests, is for HR to be proactive about messaging candidate opportunities for growth and professional development, and to be transparent about what that means and just how quickly the organization can deliver on its promises.
"I think talent pathways are becoming more prevalent, and linking development to opportunity from recruitment stages right through to exit and return will become a very successful way to engage, retain, optimise and protect your business in the longer run," she says.