Securing the skills you need
Skills shortages are dampening productivity, driving up wages and affecting morale. So what can you do to ease the pressure?
One of the things that resonated with me at this year’s CBI Annual Conference was how important it is to government and business alike that we can all access the talent we need to remain productive and capitalise on the opportunities we have.
Almost every speaker referred to difficulties securing the skills they need, the importance of greater investment in skills development and the likely impact of skills shortages.
This is particularly pertinent to us given that we launched our new salary guide at the conference, which includes the findings of our survey based on almost 17,500 responses. On a positive note, there were lots of good signs in our survey and plenty to be optimistic about. 59 per cent of organisations stated that they expected their business activity to increase over the coming year and nearly three-quarters (71 per cent) will continue with their recruitment plans.
However, 59 per cent of employers stated that skills shortages are having a negative impact on productivity. 70 per cent of employers said that they had experienced moderate to extreme skills shortages over the past year. 76 per cent don’t have the talent needed to achieve business objectives over the coming year.
These skills shortages are behind an average salary increase of 1.8 per cent across the UK. Construction and property professionals have enjoyed the highest average salary increases, with an average of 2.7 per cent, followed by IT, with an average increase of 2.3 per cent, and engineering at 2.2 per cent.
Skills shortages are also fuelling some significant salary increases for professionals with niche skills.
But it’s not just about wage pressure. Skills shortages are having a negative impact on organisations’ productivity. 59 per cent stated this was already the case, affecting their growth (30 per cent) and business development plans (27 per cent).
The shortages also risk damaging employee morale at a critical time. Salary dissatisfaction is fuelling discontent and they feel their careers are being stifled. 41 per cent of employers stated that skills shortages are undermining employee morale and 16 per cent have seen an increase in absenteeism due to workplace stress. This correlates to the employee findings, with 44 per cent rating their work-life balance as very poor to average. Almost a quarter (24 per cent) of employees said they intend to leave their current jobs due to a lack of future opportunities.
So what can you do?
In order to combat the skills shortages, organisations need to look to make workforce planning a key strategic priority, invest in their employer brand, and use contingent workers for more than just projects.
- Make workforce planning a key strategic priority
Workforce planning needs to be a core component of every business strategy. Understand the range of workforce solutions available and consider the most appropriate options. Don’t just look at immediate people needs, but also factor in risk mitigation and cost management, as that will help you put in place the most effective strategies for both the short and long term.
- Invest in the employer brand to compete for talent
Ensure that you have a strong employer brand in place. It has never been more essential given how prevalent the skills shortages are. Competition for candidates has intensified and employers need to make sure they stand out with a distinct offering that will appeal specifically to their target audience.
Employees want to get an insight into what it is truly like to work at the organisation, so they can assess whether they might be a strong fit with its culture. More employees are actively seeking this information, so employers need to ensure they have a transparent message that is easily accessible online.
- Utilise contingent workers for more than just projects
Employers risk putting so much pressure on existing staff that absenteeism continues to increase and staff retention becomes an issue – so reconsider your approach to hiring temporary workers.
Using temporary, contract and interim workers to a greater extent could help alleviate some of the pressure from the increased workload. This will help to ensure growth plans can be sustained and targets can still be met, while improving the job satisfaction of permanent employees.
To request your copy of our Hays UK Salary & Recruiting Trends 2018, visit www.hays.co.uk/salary-guide
Hays is proud to be a strategic partner of the CBI Annual Conference