Headlines in the Wall Street Journal mention chip shortages and record-breaking auto sales, which will be stymied by lack of semiconductor chips & supply chain shortages along with mass hiring within nearly every industry. Companies are struggling to land talent and opt to utilize internal sourcing efforts rather than engage a talent acquisition partner to assist with their hiring challenges.
Many companies are losing money rather than providing cost containment by sitting on jobs rather than filling the empty seats while forgetting that future employees provide productivity to an organization. Not just fill a seat or job title.
Prior to and through the pandemic, experts like McKinsey continue to tell us there are more jobs than people by millions. 85% of the jobs we will be working by 2030 have not been created yet. However, the book Hire Source, written by Deanna Mulligan, states the future autonomous car industry will create an entirely new industry worth 1.7 trillion dollars. Is McKinsey being conservative about their 80,000,000 global people shortage by 2030? The WSJ recently said the shortage will end, and things will stabilize in Q4 of 2021. But… How?
Automation, which was initially feared would eliminate jobs, has created and launched industries. Wages are on the rise and CEOs are starting to look at alternatives for talent, creating talent, lessening entry-level qualifications, for example, 4-year degrees. This certainly does not seem like the talent shortage is going away anytime soon.
HR and TA teams continue to struggle between building out internal processes for onboarding, benefits, structuring employee experience programs, retention strategies, and oh yes, also recruiting on roles from front line workforce, IT SME’s, project teams, and executive-level positions. I spoke to one HR leader the other day who also in addition to these job duties also managed offshore teams. It is staggering the amount of heavy lifting required by HR teams to meet the ongoing demands of operational leaders.
On average each job search costs a company just over 4,000 dollars and each individual search lasts roughly 45 days. Keeping this in mind, here are key questions you need to consider:
- What happens when the person does not show, accepts another offer or leaves within the first 90 days for a slew of different reasons?
- What is the cost for the search then?
- What if it takes 3, 4, 5 attempts to find the one true job seeker who is ready to commit? Where is the cost containment?
- Strategically is this the best approach?
If the organization worked with a talent acquisition partner, chances are they would not be on the hook for multiple fees to find the replacement. Every time the talent partner finds the right person and does not need to backfill the position, you are receiving quite a bit of cost containment financially and talent in play actively producing for the company.
Average salary for a newly degreed job seeker is $50K, at a 20% fee you are paying $10K. HR and TA teams do a great job at establishing college recruitment and apprenticeship programs, but what about the mid-level and on? The attrition rates are high. Nearly 50% of mid-level and beyond employees are looking for positions outside the organization.
What is the solution?
Use a talent acquisition partner who has experience within multiple industries to assist with the heavy lifting. A quality talent partner can assist with building RFP’s, provide insights across markets so you can see outside the lens of your company, help attract talent from outside your sphere of influence, and negotiate rates with the talent and provide you unbiased reports about your wage analysis so you can educate business leaders if their budgets are realistic to land the top talent in the market.
The feedback might not be what you or the leader wants to hear but at least you are hearing it. You can inform operations of critical feedback in respect to maximizing their productivity and make the best decision for your team.
HR and TA teams should not have to tackle the market alone. Work with credible talent agencies to help achieve long-term cost containment through project realization.
The more business your leaders can deliver, the more value your organization brings, HR becomes a revenue generator rather than a cost center which will be shown through delivery and productivity.