Bridging the skills gap
Job vacancy activity reached a record high in 2021 and remains higher than the pre-pandemic level. Rising job numbers have prompted workforce movement increases, and the threat of skills shortages – or an insufficient number of qualified and experienced skilled professionals – puts economic growth at risk.
Expanding headcounts, rising turnover and a supply and demand ratio favouring skilled professionals almost guarantees that organisations will be looking to overcome skills shortages.
Set yourself up for success when you next recruit by taking these steps to help bridge the skills gap threatening growth and success today.
Why is there a skills shortage in New Zealand?
The shortage of certain talent with the skills needed pre-dated the pandemic and now it’s spread across all sectors and locations. A shallow domestic pool of professionals open to employment with the skills required, combined with minimal skilled migration, a lack of internal upskilling or reskilling efforts, increased digitisation, technological adoption and an ageing working population all compound to see skills shortages reach critical levels.
This trend is not just centred upon major cities. Employers operating in regional areas face the same challenge. Nor is it limited to New Zealand. In fact, as borders reopen we expect global companies to begin proactively poaching our skills again.
Our latest research shows that over 70 per cent of organisations in New Zealand say skills shortages are impacting the current effective operation of their organisation or department – and that’s without even considering the growth ambitions of the business. The largest gaps exist in technology, trades, construction, engineering, HR and mining.
This is by no means an exhaustive list – skills shortages are now evident across almost every industry and sector and are a significant challenge for New Zealand organisations looking to return to, or capitalise on, post-pandemic growth.
Clearly, the skills shortage is here to stay and the war for talent is a real issue.
The Great Resignation: Turn challenge into opportunity
At the same time, existing staff are quitting their jobs in droves in a trend the media dubbed the Great Resignation. Tipped to be the biggest movement of talent seen in living memory, when combined with already existing skills shortages and organisational growth ambitions, employers need to work harder than ever to attract, and retain, talent.
The impacts of COVID-19 and the rolling restrictions on our movements is a prime contributor, with staff burnout peaking after 18 months of long hours spent solving new problems and challenges. Over a year’s worth of pent-up resignations along with bonuses, salary increases and promotions that fail to meet expectations are also playing a part. If employers fail to address these issues, employees will move on.
They’ve also evaluated what’s important and reprioritised work-life balance, with relocations, early retirements and a focus on improving mental health & wellbeing further adding to the resignation movement.
The Great Resignation hit the US in May 2021, with 35 million Americans since resigning from their jobs. It’s tipped to land in New Zealand in March 2022. While this could result in growing gaps in your workforce, it may show up differently in local markets. Based on conversations with skilled professionals, we’re expecting not so much a flood of people changing jobs, but a flood of people shifting their career and work-life priorities.
This creates an opportunity for employers. Provided you can accommodate the new ideals of your employees, you could be in a strong position to retain your existing staff and attract new talent – here’s how.
How to overcome skills shortages: Your nine-point plan
In a talent-short market, the ability to overcome skills shortages and secure skilled professionals is critical to business success. Here’s nine strategies you can employ to bridge the skills gap.
1. Remodel your EVP around values and purpose
You know that to attract and retain the right talent in a skills short market you must communicate your employee value proposition (EVP). Your EVP clearly communicates the value exchange that employees get from working for you beyond just remuneration. Now is the time to reinterpret your EVP to better align with current expectations.
Along with traditional benefits such as salary and rewards, flexible working, career progression and mental health and wellbeing support, today’s EVP must also bring to life your organisation’s purpose and values. In a time of market volatility, and when organisational misbehaviour is splashed across the headlines, businesses need to create, communicate and adhere to a purpose and value that considers all stakeholders including boards, shareholders, staff, customers and communities.
Consider, what does your organisation stand for? What purpose do employees help to deliver? What environmental, social and cultural issues do you champion? What values define the way you operate? The answers to these questions, and how a candidate’s personal values match up with these, will become a driving force in any new job decision.
2. Map your candidate journey and ensure consistency
Creating a map of a candidate’s entire recruitment journey, from the point they become aware of your job opportunity through to onboarding, allows you to identify every stage in the process and every touchpoint within. Armed with this data, you can design an optimal candidate experience and consistent brand message. You can also identify any barriers or concerns in your hiring process that need improving.
For instance, perhaps you identify that a candidate goes through four rounds of interviews, only to receive a generic rejection email. Imagine the brand perception this candidate is left with, which they will share with others. Instead, you could leave the candidate with a sense that you care about them and their future by making a telephone call to thank them for their time, provide feedback and explain why you will not be making an offer.
In today’s market, it’s also crucial to ensure your candidate’s recruitment journey is succinct. Candidates are now in a powerful position, which means that organisations with a slow recruitment process push the best talent towards competitors who act more efficiently. The most common bottleneck occurs between the interview and offer stage, so aim for no more than two interviews – one with the direct line manager followed by a second interview with senior management. If several senior managers need to be involved, arrange schedules so they can all attend or dial into the one interview.
3. Consider transferable skills
How strict are your job descriptions? Do they allow room to consider candidates with transferable skills? By focusing on transferable skills you’ll increase your chances of filling vacancies quickly. Often, all it takes is a short period of upskilling for a candidate who ticks most boxes to close a knowledge gap.
When considering which technical skills are transferable, identify what’s genuinely essential. Are some skills in fact desirable rather than essential? Also reconsider industry background – a candidate from a different industry often brings fresh insights to a role. Look for talent that’s ready to rise to the challenge of the learning curve presented to them.
Don’t forget soft skills, either. Communication, adaptability and teamwork, for instance, are all good indicators of how likely a candidate is to succeed in a role and fit in with your business culture.
By considering transferable skills, you’ll open your vacancy to a larger pool of candidates who have solid experience, suit your company and can become a highly valued asset with a little training.
4. Reconsider the value of location
COVID-19 enforced a rapid uptake of remote working and proved that many jobs can be done successfully from remote locations. When recruiting for new roles, why limit the geographical reach of your recruitment parameters? Instead, widen your search to the national, or even ANZ, talent pool.
This allows access to a wider pool of candidates to help overcome any capability gaps. While this can be a logistical challenge to manage, recruiters with a genuine national network have years of experience working with national talent pools. Here at Hays, for example, we operate from over 40 offices across Australia and New Zealand. We can even source talent from further afield, such as the UK, Ireland and Europe, through our Hays Globalink network.
Widening your search becomes even more important when you consider the recent upsurge in pandemic-induced internal migration. The experience of working from home during lockdowns led to the realisation that remote workers can live anywhere. In response to this flexibility change, record numbers of skilled professionals have moved out of major cities, such as Sydney and Melbourne, to smaller cities and regional locations like Darwin, Hobart and the Gold Coast, where property is more affordable, and the lifestyle is more desirable.
There is however a caveat. If you plan to recruit remote staff, trust is essential. As we have previously noted, in a remote team trust must be a cornerstone of your workplace culture. You must trust and empower your people to take ownership of their deliverables. Managers of remote workforces need to set expectations clearly, then focus on output not oversight.
5. Impress candidates in your job interviews
Today’s interviews are two-way streets, with candidates assessing you as much as you assess them. In a tight labour market, where candidates have more options, job interviews are your best opportunity to impress. After all, at the end of the interview you’ll decide if the candidate is right for your job – but the candidate will also decide if you and your job are right for them.
To improve your chance of impressing top talent, you need to conduct a successful job interview. For example, turn up on time and don’t hurry out the door. Give the candidate the impression that you value their time and the interview is your main priority. When introducing yourself and the role, don’t share information the candidate has likely already read online. Instead, share unique insights on your organisation and role to excite them about the opportunity. Crucially, be ready to answer a range of questions from the candidate, such as how your organisation responded to the pandemic, how you navigate through times of change, what growth strategy you have in place, what hybrid working looks like in your organisation, and what mental health and wellbeing support you offer. And remember to clearly articulate your organisation’s EVP and how it is practically embedded into an employee’s working experience.
6. Understand the key drivers of candidate attraction
The factors that drive candidate attraction change over time. Today there are six primary drivers of candidate attraction. To attract top talent, you must offer them all:
- Flexibility: As the concept of work-life balance evolves to work-life integration, and work is viewed as a subset of life rather than a separate entity, candidates are placing greater emphasis on regular flexibility. So, disclose early in your attraction process your hybrid and flexible working policy.
- Salary: Salary remains a key driver for candidates, with wage increase pressure mounting in response to the shortage of skilled professionals. Today’s candidates are aware of the demand for their skills, which means you must carefully manage increased expectations of their worth. While benefits (see below) can help bridge this expectation divide, there may be occasions where you need to increase salaries to secure talent in highly competitive areas.
- Benefits: Candidates are placing equal focus on benefits, but they must resonate. This differs from person to person, so work with your recruiter to get to know your preferred candidate, then tailor an offer accordingly;
- Learning and development: As part of the benefits on offer, share learning and development opportunities. Remember, all staff want to develop. It’s understandable that employers focus their training efforts on employees who need to improve, but don’t overlook the training needs of your high performers, too;
- Career progression: Career growth remains a top reason why candidates leave a job and look for a new one. Show candidates you offer opportunities to grow and advance their career with you. Let them know you will support them to thrive and succeed;
- Mental health and wellbeing support: Many people experienced burnout, fatigue or stress during the pandemic and are therefore motivated to find a workplace that supports their mental health and wellbeing. Explain the support offered in your workplace and demonstrate that you understand there are times when they may require additional support
7. Expect counter offers
As competition for talent increases, counter offers impact your ability to secure your preferred candidate. To defend against the potential of counter offers, ask candidates in the interview why they’re looking for a new job, then show how your organisation can deliver the inducements they’re after. When you make your offer, ask the candidate if they expect a counter offer from their current employer and, if so, how they intend to respond. Boost their commitment to your role with an effective onboarding process and regular communication. Despite these efforts, your preferred candidate may still accept a counter offer, so have a second-choice candidate in mind. When you ask them for a re-interview, be prepared to openly discuss why the first candidate offer fell through and why they didn’t receive the first offer. If they accepted another job in the interim, keep the door open for future opportunities.
8. Consider upskilling and reskilling
Offering regular upskilling will help you fill skills gaps while also helping your staff develop new competencies. Some employers shy away from this strategy because they believe it can be costly, but upskilling does not need to be expensive. Microlearning, on-the-job training, mentorships and involvement in stretch opportunities can be used to teach employees new technical, soft and digital skills.
You can also utilise our free Hays Learning program to provide staff with access to continuous learning programs that will simultaneously help you plug skills gaps.
9. Make use of temporary assignments
Finally, temporary assignments can be used to close skills gaps of a short-term nature. For instance, if you are about to commence a project that requires skills for a short period of time, it might not make sense to invest in the upskilling of existing staff or the recruitment of a permanent employee. Instead, a temporary or contract professional can be utilised for the duration of the project.
Overcoming skills shortages successfully
With skilled labour in high demand, using the above strategies will help bridge any current skills gaps to meet the immediate needs of your team. But there’s also an opportunity to take a step back and really consider your organisation’s long-term growth ambitions and targets, and how your current workforce can adjust to better service strategic organisational goals. By adopting a longer view of your recruiting objectives, you may identify opportunities to reshape your workforce to be future fit. Continuously monitor your workforces’ skill sets, including any new skills and occupations you may need in the future, to sustain growth.
For further insights on how to achieve recruitment success in today’s market, or to access skilled workers, please contact your local recruitment expert.