After the past 18 months of economic uncertainty, it seems an odd time for unemployment rates to fall to record lows.
Nevertheless, we have witnessed a significant downward shift in the availability of candidates since mid-July, with the number of job seekers applying for roles appearing to decrease almost daily.
There was an estimated 953,000 vacancies posted between May and July — a growth of 290,000 since the previous quarter and 168,000 more than the comparative pre-pandemic level. As a result, skills and expertise are at a premium, with the supply of workers dropping at the fastest rate since 1997.
Why is there a shortage of candidates?
Following the reopening of most sectors in July 2021, there has been an increase in hiring for both permanent and temporary positions to meet the growing demands on the economy, necessitating a shift from a client-driven to a candidate-driven market. As a result, securing the right candidate (and doing so quickly) is proving to be difficult — particularly since the coronavirus crisis has made the pre-existing skills and labour shortage even worse.
The UK lost an estimated 1.3 million non-UK workers throughout the pandemic, and a combination of COVID and Brexit-related travel and habitation restrictions will make it difficult for them to return.
Many people are also reluctant to take risks during this period of uncertainty. Highly skilled and experienced professionals are harder to tempt with new positions, as a lack of confidence in the economy has predisposed workers towards security.
For employers, this presents several issues. Should a business fail to anticipate the recent challenges involved in hiring and onboarding the talent, it will fall to existing team members to pick up extra responsibilities until the company can find a suitable candidate.
Not only does this mean reduced productivity and lost revenue, but it could also end in ‘burn out’ that prompts existing employees to move elsewhere — particularly given the renewed emphasis on work-life balance and flexibility. And any efforts to facilitate company growth during this period of post-pandemic recovery could grind to a halt.
In response to these challenges, employers are competing harder for top candidates and finding that they need to re-evaluate their recruitment strategy.
How can you secure the ideal candidate?
The cost of leaving a role unfilled is high; the cost of hiring the wrong person for the role is even higher. So, how can businesses avoid an HR disaster and secure the best person for the job in the current climate?
If current trends continue, businesses will likely come across more obstacles during the hiring process. As a result, recruitment drives may take longer than expected, so it is crucial to plan ahead.
Companies must anticipate when they will need extra resources and focus on being proactive, not reactive. For example, if a staff member will be going on leave later in the year, that gap will need to be filled in advance. And when approaching busy periods such as financial year-end, it is crucial to have thought about securing the relevant support sooner rather than later to avoid falling short.
Give people what they want
In such a competitive market, businesses must ensure that what they are offering is in line with industry expectations. Targeting passive candidates will be essential during this period, but companies will need to provide them with something special if they hope to lure them away from a secure job.
For example, since the pandemic revolutionised working habits, many candidates are seeking a flexible or remote working structure — at least part of the time. Competitive salaries and benefits are also always key selling points, but being able to demonstrate a positive company culture is now becoming equally (if not more!) important.
Focus on staff retention
First impressions are formed at the recruitment stage, so this process needs to be seamless (especially considering early communications are now more likely to be conducted virtually). No one wants to work for a company that has been terrible at communicating throughout the recruitment phase.
However, recruitment does not stop after a successful hire. Many hires are prepared to leave during their probation should the job not match up to their expectations. And when you have spent months (and lots of money) just trying to find the right person, you want to make sure you keep them, so staff retention is more crucial than ever.
Onboarding, training and creating a good work culture are all key here. As such, businesses must fine-tune their processes to guarantee a smooth and welcoming experience that will make new hires want to stay.