HR Recruitment and Retention Challenges: How to Overcome Talent Scarcity
In November, the U.S. private sector added 217,000 jobs, per the ADP National Employment Report . According to the ADP Regional Employment Report, which breaks out the numbers by regions and states, strong growth in the West and Southern regions of the US are driving this overarching trend of increased employment growth nationwide. While these economic improvements are certainly great news for American workers, this trend poses new HR recruitment and retention challenges. For Chief Human Resource Officers (CHROs), struggles to attract and retain skilled workers are a result of recent months of a tough recruitment market and wage growth.
Growing, Growing, Gone
Consecutive months of job growth in the private sector have caused talent to become scarcer than jobs in some industry sectors, a major reversal from the "great recession" of 2007 through 2009. According to Mark Zandi, Chief Economist of Moody's Analytics, "job growth remains strong and steady." So strong and steady that according to Zandi we will approach "full employment" by next summer because the "current pace of job creation is twice that needed" to support growth among new workers entering the labor market.
Why Job Growth Reports Should Concern CHROs
CHROs are already facing difficulty recruiting for skilled talent. The Technology Councils of North America (TECNA) reported earlier this year that organizations are struggling to complete hiring plans due to a "continuing shortage of qualified tech talent," according to Business Solutions. Research from the Society for Human Resources Management (SHRM) indicates 17 consecutive months of reported recruiting difficulty reaching four year highs, including a staggering 55 percent of HR departments indicating a "difficulty recruiting highly skilled employees."
Wage War
Brookings also reports that, on average, open positions for science, technology, engineering and math (STEM) workers are unfilled nearly twice as long as other job openings. For CHROs who are already struggling to match market salary demands for highly skilled workers, the recent surge in demand for professional employees has the potential to further raise wages.
Attempts to fill vacancies with H-1B visa applications for skilled foreign workers have resulted in visa applications that exceed annual available supplies, according to the Wall Street Journal. As CHROs look toward 2016, HR recruitment and retention challenges will not be simple. In a job market where demand for skilled workers exceeds supply, recruitment challenges and wage growth are almost certain to be a continuing trend.
HR Retention Strategies That Matter
Increasing wages is just one avenue to explore while building a strategy for employee recruitment and retention. There are a variety of factors that will ultimately help you to attract and keep the best talent. Implementing workforce analytics strategies can also significantly improve the impact of your attempts to combat recruitment and retention challenges. Understanding the factors that drive retention, engagement and satisfaction, such as opportunities for growth or competitive benefits packages, in your organization can be among the most effective means of remaining competitive in a tough recruitment market. Keep in mind that implementing a new strategy does not mean you will see instant results. SHRM research reports that a "huge impact" is typically seen within 100 days of first using workforce analytics.
For modern CHROs, 2016 is likely to become a year when strategy and implementation are critical program focuses. Without a plan to overcome talent scarcity in a tight job market, vital positions for technology and leadership talent could remain vacant for long periods. By developing a comprehensive approach to improving factors that matter in retention and recruitment, CHROs can retain key employees and improve their organization's magnetism with top talent, despite the job market quickly approaching full employment.
