The market for talent has always been and always will be changing. From the time the first help wanted sign was hung from a shop window to today when it’s hard to tell if we’re in high unemployment or the gig economy. However, for the last 15 years, ClearCompany has been working in the talent economy, and we’re here to identify the trends most likely to impact your role as an HR professional. Plus, we’ll give you some tips to get ready for what 2019 has in store!
Lots of Jobs, Lots of Workers
For the first time in decades, we have more open jobs than workers to fill them. While some researchers claim this is due to fewer unemployment claims, immigration uncertainty and trade wars are sure to impact this even further. Many hiring pros might interpret this to mean they’ll be able to quickly close the skills gap, but in fact, that chasm is widening as we speak. Skilled talent is still at a premium.The latest and greatest #economic trends impacting the #workforce explained:
According to the June Job Openings and Labor Turnover Survey, there were just shy of 6.7 million open positions in April. The number of vacancies is pulling well ahead of the number the Bureau of Labor Statistics counts as unemployed. This year is the first time the level of the unemployed exceeded the jobs available since the BLS started tracking these numbers in 2000.
What to do: If you want to solve the skills gap for your company specifically, start investing in training, goal-setting, performance metrics and learning. Apprenticeships are on the rise in the US and with good reason. Many companies have proprietary systems and processes that require internal training anyway, so why not hire an entry-level person you can mold into the right employee?
What not to do: Assume you can simply lower wages. For whatever reason, this unprecedented glut of workers is not having the expected result; companies are not raising wages. Economists are scratching their heads over this one, but common sense says if you can get competitive with compensation, now is the time when you can get the biggest bang for your buck.
The Gig Economy
In 2017, the Bureau of Labor Statistics reported 55 million people in the U.S. are “gig workers.” That’s over 35% of the U.S. workforce. Put in hiring terms, more than 3 people out of 10 that might have applied for your job, probably have considered or are currently participating in the gig economy. That number is expected to jump to 43% by 2020. While various studies seem to contradict these numbers, the fact remains that HR professionals must grapple with gig workers from hiring and outsourcing to benefits and succession planning.
What to do: If your company is one of the thousands who claims their “people are our greatest asset,” consider the long-term effect using primarily outsourced workers will cost. If you can, create a program that works seamlessly with your employee engagement goals for gig workers. Consider offering benefits and similar wages to your in-house employees.
What not to do: Avoid gig workers altogether. Companies with seasonal needs, those with large growth plans and specific expertise are all ideal candidates to supplement their workforce with “gigers”. This portion of the economy also puts previously untapped talent back in play, consider SAHMs that can answer customer support calls in the carpool lane or retirees who can consult on a large project for a few months. Offering gig opportunities can also take some stress off your current employees during a busy time or growth period, so don’t count out the idea.
H1-B is Hectic
As nearly every recruiter in the US knows, immigration officials now require more information from high-skilled H-1B visa applicants and have denied 22% in the last quarter — up 41% from the previous quarter, as a result of the current administration’s "Buy American, Hire American" executive order.
This has created a sub-economic trend of employers that will hire international students on the decline. According to the non-profit's annual Job Outlook report, 23.4% of employer respondents indicated they will hire international students, down from 27.5% last year and a high of 34.2% in 2015. Both these trends will make the tech landscape far more competitive.
What to do: Start looking at non-traditional hiring routes. From code schools to apprenticeships to sponsoring a scholarship at a local university, figure out how to make your company a big part of the local tech scene. Some companies are creating internal incubators, while others are getting creative with work-from-home packages and school loan repayment offerings.
What not to do: Tap a staffing agency for the assist with a tech hire. Not only has the number of H1B visa been slashed, but far fewer of those available are going to large staffing giants, with tech giants receiving the lion’s share of the available visas. And come Sept. 11, it’s slated to get even tougher for immigrants to obtain these visas.
According to the Wall Street Journal, 3.4 million Americans quit their jobs in April, which is twice the amount of those who were laid off from jobs, costing employers millions. SHRM estimates the average cost-per-hire to fill a position at $4,129 and some studies show replacing even an entry-level position can cost up to 40% of an employee’s salary.Is your company prepared to thrive in the future of the workforce? Check out the latest economic trends shaping talent today:
Industries like hospitality, transportation and retail are being hit the hardest by people ready and willing to say goodbye to their current job, due to so many available openings that might pay more or offer a better work environment. In April 2018, the retail industry saw 749,000 hires, and a whopping 721,000 separations. It’s not tough to understand why. On average job hoppers see their annual salary jump when they switch jobs by almost 30%!
What to do: Instead of agonizing over a wage increase you can’t afford, consider looking to intangible benefits like flex-scheduling, financial wellness programs or workplace collaboration opportunities. Whatever you choose, select wisely as a 2016 Aflac Workforces Report found 60% of employees are likely to accept a lower salary in exchange for better benefits.
What not to do: Burn out your existing employees. According to the BLS report, in some industries the workweek is creeping up by 0.1 hours to 40.9 hours, and overtime edged up by 0.1 hours to 3.5 hours. This could lead to decreased productivity and even attrition if not kept in check.
We can’t control the economy. Take what you can control into your own hands. Quality candidate experience is your first step to improving your hiring landscape. How are you managing talent as your teams work hard to attract candidates? Would you follow through with an opportunity with your team if you were on the other side?
ClearCompany’s Talent Management Software gives your team the power to create meaningful and effective hiring processes that carry A Players from candidates to peak performers at your company. Come out on top with a winning candidate experience by getting a demo today!