The COVID-19 pandemic accelerated three trends that were already underway:
- The search for meaning,
- the desire for flexibility, and
- the speed of digital transformation,
which has made hybrid and virtual work possible, but is also radically changing professions and the skills required by the job market.
This has also led to great fatigue and restlessness, as HR expert David Green observes, “employee expectations have increased.” Organizations are therefore examining their recruiting, development, and retention strategies to attract talent.
Talent Attraction Strategies
Traditional tools, such as compensation and promotions, are still important and work well for a significant portion of the workforce.
But many people – the majority of the potential talent pool – want more or have different priorities, and it is up to companies to attract and retain them. The contract between workers and employers is changing radically and permanently.
This aspect will likely remain the same even if the economy continues to suffer, because there will still be a strong competition to attract talent with the most in-demand and less available skills in the market.
What are the drivers of the job market?
Research indicates correlations between desire for purpose and compensation, engagement and loyalty.
If people consider what they do boring or useless, or if the workplace itself is unpleasant, there is nothing that can keep them around. Therefore, an increasingly important part of the value proposition that employers must offer employees is engagement in work that they find meaningful, stimulating, and personally sustainable. Employers must create a more personalized, flexible, dynamic, and inclusive system capable of delivering high performance in a digital and data-driven world.
The 6 Changes to Bring Your Company into the Future
What we have seen, through research and experience, is that companies will need to make 6 key changes if they want to succeed in the emerging talent market.
Being able to apply these changes is more challenging than what most companies are used to, but it is also more rewarding for both employees and employers.
1) Are we still sure that the "piece of paper" (degree or certification) is necessary?
Job descriptions generally list specific requirements regarding the education and experience needed to fill a particular role. This can discourage candidates who have the skills to perform the job but lack one of the required credentials.
To broaden the search, companies could shift the focus from degrees to skills, not lowering the selection bar but adjusting it. For example, instead of assuming that a master's degree or a master's degree is required for a management role, a certain number of years of experience, or the understanding of specific terms or concepts, companies could test the skills that are truly relevant to the role.
A new official policy from the U.S. government, for example, is to “limit the use of educational requirements” in federal contracts, and in 2021, the government encouraged agencies to “increase the use of skill-based and competency-based hiring.” To expand its hiring scope, Okta, a digital identity and access management company based in San Francisco, no longer requires degrees for certain sales positions and has created a successful program for training new hires.
2) Self-determination = happiness
Various studies have shown that people want to have a say in their work, to enhance their flexibility and well-being. Additionally, rather than following a predetermined career path, they want to create and determine their own career development.
Given the rapid evolution of work and the speed at which certain skills can become obsolete, employees must take responsibility for their own professional growth.
Among those who left and then returned to work during the pandemic, most chose a new sector. This was particularly easy for those with non-sector-specific, transferable skills, such as data scientists and blockchain engineers.
According to a recent survey, nearly one-third of employees who left their jobs did so to start their own business, believing they could achieve greater fulfillment by working for themselves.
Employers can overturn this perspective by offering greater development opportunities, learning opportunities, and personal opportunities that surpass what individuals can do on their own. Companies can do this in new ways, such as allowing people to choose their own teams or take apprenticeships outside the company for a certain period of time before returning. Self-management of one's own training can support both individual ambitions and company priorities.
This can also promote the development of long-term skills through the public recognition of a particular competency, often called "badging." A "badge" establishes a trust relationship, serving as a guarantee for aspiring learners that the skill they want to acquire is held by those who are supposed to teach it, motivating people to continue learning.
IBM launched its digital badging program in 2015 and has since seen a substantial increase in learning and employee engagement. To make such an effort attractive, it is essential that there is real value behind the badge, such as external recognition or an internal reward.
Finally, it can be helpful to collect these credentials in an updated and easily accessible registry, which can help employees keep track of them and make it easier for other parts of the organization to find people with the skills they are looking for.
3) I learn, I teach, you learn, you teach
Traditionally, learning involves a younger person learning a trade from an older, more experienced individual.
Today, learning and teaching must occur in both directions, as in the case of training that brings together, for example, a high-level financial executive and a lower-level AI specialist.
The American multinational consumer goods company P&G is an example of how this idea has been permanently integrated. Its "reverse-mentoring" program pairs colleagues at different career levels to learn and teach from each other. The younger partner might provide knowledge on digital tools; the senior one might teach the fundamentals of marketing or manufacturing.
Una dinamica di apprendimento bidirezionale offre ai lavoratori l’opportunità di una crescita continua e può portare a una maggiore fedeltà e produttività.
According to a recent study by the McKinsey Global Institute, companies known for valuing learning are better at attracting talent.
4) Teamwork: Key Aspects to Make It Truly Work
Digital tools, advanced analytics techniques, and artificial intelligence (AI) have changed the way we work.
Hybrid technologies connect global skills with just a few clicks and calls, and agile work methods enable companies to create more flexible organizations. More and more employees can choose who to work with and who to connect with.
The fact that people can collaborate doesn’t mean they do so effectively. However, there are ways to make teamwork work.
Google's "Aristotle" Project, for example, discovered that the best teams are not defined by who is in them, but by how they work together. The project found that the most important aspects of successful teams are:
- The psychological safety,
- The reliability,
- la strutturalità
- The structure
- The values and meanings given.
5) Growth is not the result of seniority
In traditional career paths, performance evaluations and promotions were strongly tied to years of service. Progression up the organizational ladder could literally be a matter of time.
The relationship between years of service and performance, however, is at best unclear and might not even exist. Furthermore, this paradigm no longer holds in the post-pandemic context, where employees are more demanding and unafraid to leave their jobs.
Rotation, not stability, is the norm: According to a survey reported in the 2022 LinkedIn Learning Report, the percentage of respondents who changed roles increased by 25% between October 2019 and October 2021.
McKinsey has long been known for its "up or out" policy, where people progress according to a predictable timeline or, otherwise, are encouraged to change jobs. The thinking on this has evolved. Now, the approach is more akin to " grow skills or leave". People are expected to continuously develop new skills, and it largely depends on them to determine which ones and how quickly.
McKinsey's new career evaluation criteria, based on impact and mastery of skills, are as rigorous as the previous approach but much more flexible, allowing for a more dynamic response to the rapidly evolving needs of clients. They are also fairer and more inclusive, as they allow individuals to tailor their careers to their life choices.
According to some research, the lack of career development was the most common reason many people resigned, and it is one of the main motivations for choosing a new job.
A flexible, results-oriented system can help in both cases.
6) Diverse and Inclusive Collaborators
Many companies have committed to doing more to create a diverse and inclusive workforce.
Companies with a high percentage of women and ethnic minorities in their leadership teams are significantly more likely to achieve above-average profitability compared to those with a relatively low percentage, and this benefit has grown over time.
To fully leverage the benefits of diversity, it is not about hiring people who fit the existing corporate culture, but about ensuring that the culture itself is sufficiently favorable and adaptable to welcome all types of talent.
Only by doing so will companies harness the creativity, innovation, and diverse ways of thinking that diversity can bring.
Empirical data can help managers understand, for example, why people leave and which individuals are making this decision.
Are they parents? Women? Older employees? Young employees? Based on this, companies can improve their culture so that people feel more valued and are therefore more likely to stay.
The future
Even before COVID-19, 90% of companies feared facing future skill shortages, but only 16% believed they were capable of bridging those gaps.
The World Economic Forum estimates that technology could impact one billion jobs. In this context, and given the pressure in many labor markets, the global talent hunt is bound to intensify.
This is a new era.
This great renegotiation is a process, not an outcome.
It requires companies to play both offense (creating a better value proposition for employees to attract new talent) and defense (making staying more attractive). Adopting the changes described in this article will not be an easy task, but they are all essential elements for meeting the needs of the talent market of both the future and the present.
Source: https://hbr.org/2022/10/competing-in-the-new-talent-market?ab=hero-subleft-2
