To define the pandemic as stressful is a huge understatement. It was such a shock to the system that tens of millions of Americans - and people around the globe - are reconsidering how and where they live as well as what is truly important to them. These existential questions have pushed many people to voluntarily leave their jobs and move on to other companies - or entirely new careers. This phenomenon, known as The Great Resignation, gained momentum in the United States throughout 2021 and has continued in 2022. Signs of this trend are also appearing in developed nations across Europe and Asia as companies begin to see a similar wave of resignations.
The most common reasons behind this wave of resignations - as defined by Andrew Klotz, the organizational psychologist who is credited with inventing the term the “Great Resignation” - can be attributed to these four points:
While some people have left the workforce entirely to care for children or elderly family members, the majority are looking for better jobs in the same industry or are seeking a complete career change.
The growing need for highly-skilled workers combined with the risks faced by many low-skilled, essential workers during the pandemic have also triggered the shifts we are observing in the workforce. Individuals are seeking jobs that offer career advancement opportunities, that are a better reflection of their values, and that enable them to prioritize their well-being or family responsibilities.
For recruiters, this radical shift in job seeker preferences is increasing hiring pressures and changing how organizations engage with both candidates and employees. Companies are looking to recruitment teams to help them fill vacancies quickly and to share their knowledge on how to adapt hiring practices and compensation packages to attract - as well as retain - the top talent in the current environment. As a new workforce landscape is painted in the next few years, some important features are already taking shape today.
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As the massive wave of resignations continues this year, companies are taking steps to stem the tide of workers leaving their jobs.
In February alone, 4.4 million Americans quit their jobs. Increasing pay and growth opportunities are a few short-term ways that companies are attempting to keep employees from quitting. However, the most crucial steps companies can take to keep employees loyal and happy in their job include showing appreciation, maintaining two-way communication between employees and management, providing training opportunities, and showing genuine concern for their well-being through programs and time off. Technology solutions can also help HR professionals keep employees’ certifications, raises, and other details organized so that they can identify employee issues before they leave the company.
Technological advancements and rapid digitalization are driving innovation, but it is also exacerbating skills shortages across industries that the university system can’t fill fast enough on its own. For millions of workers, this means that reskilling is essential to remain relevant in the workforce. Despite this fact, the Organisation for Economic Cooperation and Development (OECD) reports that companies may not be taking the opportunity to prepare for the future by offering adequate training opportunities to their employees. Its 2021 Employment Outlook notes that only about 13% of the training that companies provide aligns with their strategic needs. These investments in existing employees can provide an incentive for them to continue working for an organization and help them to potentially rise to other areas of the business.
It is no surprise that as companies struggle to fill job vacancies that they will need to be prepared to spend more on hiring to attract the most qualified talent. In an environment where job seekers have the upper hand, offering competitive salaries is an obvious way to capture the interest of top talent. However, it may not keep younger employees for long as they value broader benefits and incentives such as retirement plans, tuition repayment assistance, flexible scheduling, and options to work from home.
Companies that add non-wage benefits to attract and keep workers on the payroll have a better chance of building a strong workforce over the next few years. Recruiters can play a significant role in building a compelling brand to get professionals excited about working for a company and upholding corporate values that keep them employed for longer tenures.
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Approaching talent acquisition as you did in the past is not sustainable in the current environment. Long, drawn-out interview processes, focusing on active candidates alone, or not clearly defining what you are looking for in an applicant in job descriptions will not garner the number of qualified applicants that companies are looking for or lead to lasting hires. Additionally, focusing on traditional qualifications like education over skills may limit the applicants that you interview.
For employers to meet near-term strategic objectives, they may need to tap into the gig economy. With a clear understanding of what is needed from candidates, companies can be flexible about considering workforce structures beyond permanent employment to adapt to professional preferences. Although the gig economy existed before, the pandemic and the Great Resignation certainly helped it grow. According to Intuit, about 44 million people were self-employed in the United States in 2019, and 28% of those individuals worked gigs at least some of the time.
In a recent report, Randstad noted that globally two-thirds of professionals are, “taking charge of their destiny, either in the workplace or at home.” Gig economy work is the primary way for people to accomplish this goal. The maturing gig economy presents a win-win opportunity for companies and professionals since companies can quickly hire professionals with the skills required for short projects, while professionals can dictate when they work and the general terms of engagement.
Technology adoption is helping companies across industries improve and optimize various business functions - and recruitment should not be any different. Deploying a recruitment technology solution can make talent acquisition in a tough environment much easier and streamline increasingly complex processes. Cloud-based solutions with AI capabilities can support organizational growth and provide a foundation for companies to build high-performing recruitment teams that have a real-time, in-depth understanding of the market and the ability to adapt quickly to changes.
Implementing an applicant tracking system (ATS) like Manatal as part of an HR tech stack streamlines recruitment activities so that teams are free to devote their time to consistent engagement - and tracking - of candidates.
Beyond 2022 as resignations return to a normal level, companies will continue to be faced with competitive hiring markets, digital advances in recruitment, and shifting job seeker preferences. The organizations that succeed must be agile and receptive to different methods of talent acquisition. The outlook for recruitment teams will be bright if leaders are committed to investing in technology to enhance their processes and to making the organizational changes required to support evolving talent needs.
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