Inefficiencies that have built up in recruitment processes. Employers in the UK will waste £9bn on recruitment this year as a “War for Applicants” unfolds, according to TalentTrack, an AI-powered talent acquisition platform. Their research claims too many employers in the UK are relying on outmoded technology to hire new workers. In one interview, founder Mark Taylor offered a case study: “One HRD we spoke to was using 40 job boards but the hire rate they were generating was only 1%. Better [use of AI] saw them reduce the number of job boards to just 8, but applicants increased by 40% — and its hire ratio improved to 11%.”
In a time of rising wages, soaring job confidence, and epic job shortages, investing in this sort of technology will be of critical importance to HRDs and employers.
A record number of Britons are in work as company payrolls have surged over the course of the last twelve months. Early estimates for September 2021 indicate that there were a record 29.2 million payrolled employees, a rise of 3.6% compared with the same period of the previous year — and a rise of 1,008,000 people over the 12-month period.
While over a million people have found work, TalentTrack estimates that 11 per cent of people in work twelve months ago will also have changed jobs – comparable to some of the highest percentages ever recorded. This means that over the 12 months to September 2021, organisations have made approximately 4,100,000 job hires.
It will get worse before it gets better. A large poll undertaken by recruiter Randstad UK suggests almost 7 in every 10 employees (69%) feel confident to move to a new job in the next couple of months. Meanwhile, only 16% of workers describe themselves as worried about trying to get a new job. Those in construction, tech and logistics were among the most confident in the country — with workers in manufacturing being the most confident, with 74% saying they felt confident about moving to a new job.
Employers will never have been as motivated to invest in improving their recruitment technology as they will over the course of the next 12 months.
While that sounds like excellent news for TalentTrack, should HR professionals be worried about what technology might do to their jobs? After all, technology did for blacksmiths, typists, and switchboard operators. Black cab drivers in London could once command a hefty wage premium. The reason? Becoming one wasn’t easy. A wannabe cabby had to undertake “the knowledge” to demonstrate his or her (probably his) encyclopedic mastery of London’s streets. Not everyone can do that. The result was an earnings boost for cabbies: scarcity bred value. Then Uber started equipping its drivers with an app that provides turn-by-turn instructions on where to go and how to get there. By removing the need for specialist knowledge, by making it so much easier to ferry passengers around London, Uber app also removed the need for encyclopedic mastery that had historically commanded a wage premium…
Should I be worried about going the way of the lamplighter — or of tumbling wages?
Perhaps not. The picture is more nuanced.
First, as the Harvard Business Review put it, “technological singularity — the idea that machines know all, and can fix all — remains, despite what we’re told, a long, long way away.” Though useful, there’s a limit to what AI can do.
Second, Alan Krueger, the Assistant Secretary of the Treasury for Economic Policy, under Barack Obama, has highlighted the potential for automation to boost wages. Krueger found that computer-savvy workers — labourers who worked alongside automation, in this case — commanded wage premiums of 10 to 15% more than their computer-illiterate counterparts. And the economic historian, James Bessen, suggests that over the past two centuries, wages have risen 10-fold thanks to technological progress. He credits wage growth for many ordinary workers to new technology. These are encouraging stories. Bots could boost wages.
While technology can depress wages by making some jobs easier to perform, that’s only if a job is simple. On the other hand, bots can boost earnings when workers are using technology that demands specialised skills and knowledge.
In September, Wilko invested £3m in a robot delivery firm Street Drone which is developing driverless delivery carts. That’s going to affect jobs.
But in March, research house Morningstar put robots to work writing analyst reports on savings and retirement funds, increasing its written research without adding pressure to its human analysts. Their jobs are safe because they remain focused on the most popular funds where they are needed to interview fund managers and talk to teams about their investment processes. That kind of colour is not captured by the quantitative process.
I think HR professionals (and recruiters) are equally as unlikely to be made obsolete by AI. Robots can, and should, occupy roles that offer workers little in the way of purpose. AI can increase productivity, improve efficiency, and reduce errors. But AI can’t do your job. And besides wouldn’t you rather not post the same job spec to 40 job boards if there was another way? Sometimes, forsaking human effort for algorithmic prowess makes sense.