Talent trends don't always provide easy fixes, but the solutions they present may help to significantly reduce talent shortages.
In May 2019, the United States unemployment rate hit a 49-year low. As a result of this ongoing trend, many organizations are finding it increasingly difficult to identify and recruit talent. This trend has been good for recruiting firms, but it has also driven up recruitment costs for employers. And as the #MeToo and gender pay equity movements continue their momentum, women are being more vocal about the disparities in their workplaces.
These economic and societal realities are key drivers behind the following talent trends, and if your organization isn't on board yet, it's time to take notice.
1. A Move from Annual Reviews to More Frequent Check-Ins
Several factors are driving this talent trend. The Harvard Business Review and numerous others have reported on white collar workers' contempt toward the reward-or-punishment aspects of the annual review cycle. Due to increased focus on employee engagement as a means of retaining employees, organizations need to ensure that their workers are staying on track to achieve business goals.
This requires the alignment of employees' work goals and organizational goals. To that end, more formal quarterly reviews can provide regular, systematic feedback to help guide employees. When these reviews are paired with less formal check-ins, organizations tend to see a positive impact on performance.
Other businesses are doing away with formal performance reviews altogether. In place of formal reviews, these organizations have instilled frequent, informal check-ins between managers and employees. Upon weighing the advantages of check-ins over annual reviews, many organizations are finding that implementing the change can be well worth the effort.
2. Salary and Performance Transparency
For years, many businesses have deliberately avoided salary transparency. In some cases, HR departments have even reprimanded employees who did discuss their wages with co-workers. This secrecy is being seriously challenged by a rising demand for the publication of mid-to-upper management salaries in certain industries, such as brokerage and investment management.
With these numbers published, many organizations who once touted equal pay are showing great disparities in what female managers are paid versus men in similar roles. To help change this, progressive HR leaders are revamping their pay systems to reflect extreme clarity about the pay and bonuses employees can expect to receive and what constitutes outstanding performance.
3. The Growing Gig Economy
It is a fact that the gig economy is here to stay. Instead of only using temp agencies, staffing firms and large consulting firms as before, organizations are turning to freelancers, online platforms and smaller consulting firms to fill personnel gaps. According to Forbes, 66 percent of large corporations now use gig workers such as freelancers to lower overall costs, while 58 percent of midmarket businesses use gig workers to provide skill sets and experience that their current employees don't have.
With the rise of technologies that better facilitate online collaboration and the increasing number of platforms for finding and engaging talent, these percentages are projected to increase through 2019 and beyond.
4. Expanded Recruitment Options
Due to the tight labor market, an increased focus on women in leadership and the need to find the right people at all organizational levels, more organizations are expanding their recruitment options and sources. Some organizations are embracing college interns as a relatively low-cost means of accessing talent. This also allows firms to build a sense of loyalty earlier, as the number of organizations that hire college interns pales in comparison to those who hire new college graduates.
Many organizations are also opting to reach out to various associations such as women's groups, minority business groups and other professional networks to increase their visibility among the groups' members and tap into a broader talent base. Additionally, businesses are expanding their geographical search parameters to account for the availability of gig economy talent for digital projects.
5. Flexible Options for Highly Tenured Personnel
As the workforce ages, some organizations are in danger of losing highly valuable employees with deep knowledge bases to retirement. Many retirement-age workers, however, are continuing to work. To retain these high-value employees, strategic HR leaders are revamping the way they approach workforce retirement by having earlier conversations with them and implementing flexible work-related options for tenured individuals.
Conscientious HR leaders will examine these trends, decide which ones apply to their organizations and take the necessary steps to account for them. Talent trends don't always provide easy fixes, but the solutions they are presenting could help significantly reduce talent shortages.