Ripples of Change in the Talent Pool
1 December 2009 by
At this time of year salary surveys and industry trend analysis is abound. All of it now reporting, unsurprisingly, the same news; it’s been a tough year. We know it, you know it, and so do your teams. Matt Cockbill, the Odgers Select Head of Practice for IT & Technology casts an eye forward to the challenges ahead in 2010.
Our insights to the market indicate that just as costs have been under tight control within businesses at large, reward has been similarly constrained. 2009 has, almost universally, been a year with a clear ‘do more with less resource’ dilemma. The same constraint is reflected with employee reward; bonuses limited, pay rises capped or frozen. As stock & LTIP schemes have failed to realise the values once hoped for, there has been no counterbalance in the personal earnings equation.
Put simply, at a micro-level your teams are doing more work for less reward. The UK has long been famed for its ability to thrive under a ‘blitz mentality’, drawing together to struggle forward. But as the inevitable recovery slowly becomes a reality, top talent will want to see the quid pro quo for their loyalty and efforts. With market recovery come options, and increased career options means greater workforce mobility.
With mildly increased levels of recruitment in the market, we are already beginning to see increased competition for the best candidates. People are securing new roles and beginning to exercise choice carefully. Examples of experienced candidates with two, three or four alternate offers are on the rise. There is still an over supply of resource in the market, and so hiring managers across the board have good diversity of choice, but the competition to secure the best is increasing.
As the tides of the talent pool shift; firms must address their employee value proposition in two key areas; internal and external. Firstly, ensure that your retained talent is well engaged, and secondly align your external proposition to fight for its place in ‘attracting’ the best talent as the competition hots up.
Both are simple strategies to throw out for consideration. These are not simply issues for HR to resolve. Internal talent engagement will remain to be a critical area of focus. The market recovery is unlikely to be swift, and so project and operational teams will be required to be pulling hard for some time to come. As a senior manager you set the tone for your team and through you they will derive the motivation to really help the business succeed, or be disheartened by perceptions of low morale.
However, do not naïvely assume that your external employee value proposition is purely consumed externally. Your existing teams will take a view; the external ‘sell’ must tally up to the internal reality. If not the impact is obvious; alienation, disenchantment and a perceived two tier workplace where the new entrants are more highly prized.
This may well result in an exodus of talent. In times such as these, reward and recognition is a thorny topic. Recognition and acknowledgement of contribution is crucial at any time. Issues of reward are magnified by the economic conditions. The challenge really lies in assessing the impact of; an internal promotion, additional training and development, a discretionary bonus or a small pay review, to your top talent. What might be lost in short term ‘cash’ will invariably show a healthy return in the additional productivity and sustained loyalty generated through these modest investments.
All business leaders know that consistently delivering upon our promise is crucial. Inch by inch as we crawl out of the depression it will never be more important to have your teams ready and willing to step up to the new challenges ahead. The ability to survive has got you here, but it’s not going to be enough for much longer. As others prepare to thrive, it’s time to get in shape and make sure your people share the same view.