After what for many has been a turbulent couple of years, we are again witnessing a period of immense change for businesses and organisations as they grapple with a return to ‘normal’.
The recruitment market is more competitive now than it has been at any time for a generation; and whilst demand for candidates is at an all-time high, supply has been artificially depressed. As a result of the vast number of injections of flexibility into working practices and increased staff retention efforts, there is a far lower desire amongst employees to make a move than we would normally expect to see.
And for companies, it simply hasn’t been a case of a return to life pre-pandemic; sensible employers will have had to adjust their outlooks and consider hard what the potential impact will be long term of the decisions they are taking now to appease their employees.
Demand for top talent is high and with a scarcity of candidates, many employees may feel that they are in a stronger position to work the situation to their advantage in order to secure, not only the salary and benefits package and career progression routes that they desire but also, the working hours and flexibility that they feel they are entitled to insist upon so that work does not become an ‘inconvenience’ on other areas of their lives.
Expectations are changing; where previously it may have been viewed that leadership roles and accompanying salaries came with certain ‘sacrifices’, there is a huge pendulum shift as the drivers for flexibility move beyond adjustments for say, childcare or caring responsibilities, into lifestyle and personal interest choices which, pre-pandemic, would have been fitted in and around the demands of the job.
Employers need to balance the fine line between the consequences of any decisions that they make to accommodate employee demands and ensure staff retention alongside the impact that these may have upon other team members and business productivity.
Businesses that have been afforded with good retention records in recent years and have not had to go out into the market on a regular basis, may find that in the current market - where salary levels are moving rapidly and are extremely fluid - their own salary and benefits packages are a little out of line. They must weigh up the impact of a couple of resignations and – assuming that your top talent is likely to be approached – decide if pre-emptive measures are needed to address any shortfalls.
Reviews will need to be conducted more frequently – half yearly or in some cases quarterly – and whilst benefits themselves haven’t seen much change, employers should be mindful of the current market situation and consider, in scenarios where bonus levels could be increasing, introducing a claw back option into contracts.
The fluidity of the market makes it imperative to seek out specialist advice and assess situations from both employer and employee perspectives – if as a business you are hearing there is a lot of demand for candidates, you can be sure that the same advice is also being given to your employees if they are on the look out for a new opportunity.
Will we see much change? With a swirl of events both home and abroad possibly having a significant impact on consumer spending and potentially slowing down predicted growth, the coming 12 months look to be anything but predictable.
Lee Sweeney is Executive Director at Sharp Consultancy and advises major accounting practices, venture capitalists and banks in the North of England on the appointment of senior finance professionals; contact Lee on 0113 236 6300 or lee@sharpconsultancy.com