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The talent crunch


Credit crunch In times of economic turbulence, recruitment budgets can often be the first to go, so how can HR professionals ensure that their recruitment and retention strategies are up to scratch? Verity Gough reports.

Much is being made in the media at the moment about the prospect of a recession in the UK. This concern is being further fuelled by reports that organisations are clamping down on spending, planning redundancies and preparing for the worst. But are things really that bad?

Despite recession fears, industry research points to a buoyancy among the UK workforce and according to a recent survey by online recruitment agency Jobsite, seven in 10 employees are confident they will remain in or get a job during the current economic climate, while almost half again are even planning to move jobs this year to boost their pay packets.

Successful recruitment and retention strategies

  • Consider investing in your own direct resourcing capability such as a company intranet
  • Look at rationalising your in-house expenditure
  • Seek out new talent via social networking sites like Facebook, Bebo and LinkedIn
  • Be smart: Use job perks, training and other incentives to engage talent and incorporate it as part of your retention strategy
  • Think about bringing in flexi-working, job sharing, mobile working and home working as alternatives to bring in new staff and engage your employees
  • Ensure you give staff career plans to keep them engaged and motivated
  • Make the recruitment process as quick and easy as possible and revisit possible applicants when suitable openings appear.
  • Jobsite has also reported at least 45,000 new jobs are being posted each week, especially in key sectors such as sales, IT and engineering, while online recruiters have reported expansions in many industries.

    In fact, data from the Office of National Statistics shows that despite talk of a recession, the UK is seeing its highest levels of employment and job vacancies since records began in 1971. So what is all the fuss about?

    Gerwyn Davies, public affairs manager at the Chartered Institute of Personnel and Development (CIPD), thinks that while the official government statistics look benign, employers are showing a degree of caution, a fact which has been supported by figures from the latest CIPD/KPMG Labour Market Outlook (LMO) survey.

    “The net recruitment intentions of employers are at their weakest since the inception of the LMO study four years ago and in the past six months they have come particularly marked,” says Davies. “However, this is a reflection on just how healthy the labour market has been in recent years and we are simply seeing a curtailing rather than any drastic reductions.”

    Yet despite this apparent positivity, there are concerns that employers’ ‘wait and see’ attitude may still trigger a wave of redundancies. “If the slow down becomes sharper or longer then we could see a possible loss of confidence, which could result in an avalanche effect where there is a sudden rush of job cuts,” adds Davies.

    Britain’s got talent

    Another issue is the serious skills gap in the employment market, once again bringing the issue of talent management and retention to the fore. Andy Baillie, business development director at talent management solutions company Kenexa, believes many organisations are using the current hiatus to look at their policies around recruitment and retention, and examining their performance capabilities within their existing workforce.

    “Companies are realising they have a huge amount of untapped resources within their organisations,” he explains. “Why spend the money recruiting in different markets when there are people who not only know their organisation but have exactly the right level of talent and skill sitting right there in the businesses?”

    Richard Doherty, Vice President of Operations, UK and US of people management company Jobpartners, thinks the credit crunch is clearly impacting on companies’ recruitment strategies. But rather than sparking redundancies, he has seen a growth in organisations moving towards a more direct model of recruitment: reducing reliance on agencies, recruiting directly, and implementing new media in a bid to cut costs.

    He advises managing internal recruitment by proactively structuring the careers and succession plans for people across the business at all levels of an organisation. “By making sure you have the right information in one place and managing your processes around your people so they are always being appraised at the right time, you are setting objectives and monitoring staff throughout the year,” Doherty adds. “If you have all those ingredients together, you can be sure you are moving the right people up through the organisation.”

    Nip Tuck

    Managing the internal talent is one way of reducing the HR budget but organisations seem to be shaving costs just about everywhere. “We have seen a reduction in the average working week,” adds Davies. “This could be companies thinking of ways of cutting costs while holding onto staff, as we have seen in previous recessions and downturns.

    “In the past, the big mistake has been too much of a knee jerk reaction to redundancies, so when the good times returned the talent was lost and they had to bear the huge cost of recruiting.”

    “In the past, the big mistake has been too much of a knee jerk reaction to redundancies, so when the good times returned the talent was lost and they had to bear the huge cost of recruiting.”

    Gerwyn Davies, CIPD

    But with HR managers reporting recruitment difficulties, coupled with the acute skills shortage in the UK, clearly the need to manage talent remains critical. “It’s becoming harder and harder to get good people into your business,” says Doherty.

    “Generation X is the biggest demographic since the baby boomers and their way of engaging, gathering information and interacting is completely different to previous generations. These people are very active in social networks, they live on the internet, so rather than presuming they don’t use these things, you should presume they do, otherwise you are going to get left behind.”

    Baillie also recommends implementing new media such as social networking sites and intranets to engage potential employees, but adds that HR should aim to maintain an on-going relationship with prospective employees.

    “Often, a candidate will go through a recruitment cycle and will effectively fall off the radar,” he explains. “The candidates that made the shortlist should still be considered for jobs. If HR fosters that relationship, they will remain attractive employees to you in the future.”

    Likewise, staff retention is an increasing challenge. “At a time when you are letting staff go, people get itchy feet. You need to show them that there is a future, there is a career path mapped out for them and they should stick around,” Baillie adds.

    Finally, it seems that speed and efficiency in terms of the recruitment process is essential. “You can’t hang around,” says Doherty. “You need to process recruits quickly to make it easy for candidates to apply. Don’t put in too many barriers, make it a pleasurable experience, make sure it’s aligned with your employer brand and make sure it’s consistent.”

    So while the market continues to endure its ups and downs, there seems to be a back to basics attitude that is seeing HR looking internally to develop talent, while active use of new media offers a free and expansive pool of potential talent.

    However, while the economic future remains uncertain, now appears to be the opportune time to re-evaluate and realign all recruitment, retention and performance management strategies.

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