As the unemployment rate hovers
around 2 percent for college-educated
workers, it’s becoming increasingly difficult for businesses to find qualified candidates to fill job openings. As the competition
for skilled labor heats up, workers are getting
more assertive about asking for better compensation packages.
According to “The Employment Dynamics
and Growth Expectations (EDGE) Report,”
an annual study on employment and compensation trends conducted by Robert Half
International and CareerBuilder.com, the
majority (57 percent) of hiring managers
polled said it was difficult to find qualified
candidates a year ago; and 91 percent said it’s
equally or more challenging today.
According to the survey — which polled
more than 1,000 hiring managers and 900
workers — 58 percent of workers said they
are more likely to negotiate a better compensation package today than 12 months ago,
double the number from last year’s poll.
“This intense demand for qualified workers
puts potential candidates at a distinct advantage, and they are realizing that they have
strong negotiating power,” says Terry
Phillips, vice president of Robert Half
International in Akron, Ohio.
Smart Business spoke with Phillips about
the rising concern over employers’ ability to
fill open positions and some solutions to the
current recruitment problem.
What is causing the hiring shortage?
There are two major factors: the impeding
retirement of baby boomers and the
increased demand for professionals with college degrees, because of the boon in the
economy over the past several years, which
allowed many businesses to expand. There is
an increasing demand for professionals with
certain skill sets, and less of a talent pool.
What particular skill sets are in the greatest
demand, and why?
The greatest shortages are at the staff level
in sales, customer service, information technology (IT) and accounting. These positions
require more than two years of experience.
The Sarbanes-Oxley mandate has a lot to do
with the demand for accounting positions in public companies. But corporate governance
affects all companies — private and public.
In the accounting profession, we are still suffering from the fallout from the corporate
scandals, which discouraged students from
taking the accounting/finance route. That
same scenario applies to the IT shortage.
With the dot-com bust, fewer students were
willing to go that route in their college studies. In other skill sets, the recent boon in the
economy has led to a greater need for customer service and sales positions.
What does this mean for companies looking
to fill spots?
Frankly, I see businesses getting less picky
about candidates. This does not mean lowering standards, but if hiring managers are
looking for candidates with two years experience, they will have to dig deeper into the
pool of talent and opt for aptitude rather than
experience. In other words, they will have to
hire more entry-level workers who have just
graduated from college than those who have
been in the work force for several years.
What sales pitch should companies give to
potential candidates?
Hiring managers need to talk to candidates more about careers rather than jobs.
They also need to stress the success of the
organization, the growth potential in its
market niche and the business’s past track
record or success. The idea of making this
kind of ‘sales pitch’ to candidates may be
foreign to many companies, particularly
those that are steadfast in the perception
that there isn’t a talent shortage out there.
And, indeed, some companies may not be
seeing a shortage because these businesses have not had to hire because they are
not growing. But companies that are on the
fast track are all too aware of the shortage.
All businesses need to understand the
trends, and the pendulum has clearly
swung in favor of the job candidates.
What should companies do to keep good
employees?
Companies need to focus more on retention, which could mean more compensation and better perks, such as flex schedules and telecommuting. Interestingly, our
survey did not see a rise in turnover from
last year, so that leads us to believe that
companies are waking up and beginning to
implement good retention strategies. In
fact, 31 percent of hiring managers we surveyed said their firms have instituted new
policies and programs to increase staff
retention rates in the last 12 months,
including offering bonuses, increasing pay,
improving the office environment and providing a more defined career path.
Hiring managers may want to rethink
those retention efforts, however, and focus
on things more closely related to work-life
balance, since the top perks that workers
said that would cause them to jump ship
for another job are flexible schedules at 65
percent, telecommuting opportunities at
33 percent, employee stock purchase plans
at 33 percent and on-site fitness facilities at
31 percent.
TERRY PHILLIPS is the vice president of Robert Half
International in Akron, Ohio. Reach him at (330) 253-8367 or
[email protected]. Robert Half International has more than
350 staffing locations in North America, Europe and the Asia-Pacific region, and offers online job search services at
www.rhi.com.