Economic turbulence and workforce shifts prevailed through 2019. 2020 shall see a slight upswing in the predicted GDP growth. Despite this widespread uncertainty, the global hiring market was quite active in 2019.
The talent landscape of 2019 and 2020: Region outlook
Euro Area: Europe saw good hiring activity across France, Belgium, and Germany on accord of economic growth, digitization and expansion of local companies. Spain saw buoyancy in the first half, but slowed down in the latter half due to the US-China trade war. Not much can be stated about 2020 due to the uncertain outcome of Brexit, but France, Belgium (HR, marketing, administration and supply chain), Netherlands, Spain (technology sector)will continue to have demand for specialist skills.
- UK: Despite Brexit delays, pockets of hiring activity across technology, property and professional services were seen. Emerging industries, disruptors and SMEs may continue to hire through 2020.
- Middle East: UAE, Saudi Arabia and Kuwait saw good hiring numbers, thanks to nationalization policies. This led to local talent shortages, wage inflation and local talent. 2020 shall present new growth opportunities, kickstarted by Expo 2020 and renewed nationalisation-focus.
- Africas: Cautious hiring prevailed in South Africa in 2019 due to general elections, a sluggish economy and unemployment, with somewhat high demand for technically competent legal and finance specialists. 2020 will see high demand for professionals with both technical ability and strategic acumen. Both East and West Africa saw heightened recruitment for finance, legal, sales and operations personnel, while Central Africa hired sales, marketing and finance professionals. In 2020, we can expect strong competition for skilled nationals, and employers shall invest in skill-development, retention and competitive benefits.
- South And South-East Asia: In Greater China, professionals were reluctant to switch due to looming trade-friction and manufacturing outsourcing. Demand for specialists shall continue in 2020, though companies would prioritize retention strategies such as career development and smart policies. South East Asia showed a positive sentiment in Indonesia, Philippines, Thailand and Vietnam, with high demand for ‘glocal’ talent. This shall continue through 2020, as digitalization efforts create demand for ‘glocals’ in mid-level and senior positions. Japan faced a talent crunch due to its ageing population and need for bilingual professionals. Yet, the expected 2020 roll-out of 5G bolstered the need for AI, cloud, mobility and smart-tech skills. In 2020, “equal pay for equal work” legislation is expected to come through, leading companies to utilize contractors for specialist skills. Australia and New Zealand remained steady with pockets of hiring in technology, financial services and infrastructure. Expected elections in 2020 may lead to a pre-election spur in contract-hiring, especially for skill-shortages. Also, both the Australian and New Zealand governments are currently tightening immigration restrictions, which may force employers to proactively build an international talent network and migration-advisory skills.
- US and Canada: In the US, hiring in the Bay areas was high for design-thinking leaders, while New York primarily hired technology, data privacy, cyber security, AI and machine learning professionals. Los Angeles demanded audit professionals and operational leaders. In 2020, the US shall see high demand for skills such as machine learning and AI, revenue-generating roles (sales professionals), lawyers, financial research, trading strategy, risk management, AR/VR and gamification etc. The Canadian economy shall continue to grow in 2020 as it did in 2019. The government is facing challenges related to high baby-boomers and low millennial population, forcing them to resort to mass immigrations to fill high-skill positions.
- LATAM: Economic disruption continued through 2019 in Brazil, Chile and Mexico, with hiring limited to specialist tech-talent. In 2020, Brazil’s pension reform may spur foreign investments, while Chile’s planned budgetary injection of USD $600 may foster hiring. Talent shortages are expected for skills such as business English, digital experts, data scientists and cyber security specialists.
On an average, 2019 saw some decent hiring activity, with increasing demand for specialist technology, risk, regulatory and compliance skillsets in many markets over the world.
Challenges for Organizations and Employees in 2020
A talent paradox persists amidst stubbornly high unemployment, and employers are facing challenges filling technical and skilled jobs.
While a whopping 80% of survey respondents indicated they planned to stay with their current employers in the next year, nearly a-third (31%) expressed dissatisfaction with their jobs.
These contrasting numbers put forth the question- Are employees truly satisfied? Or are they simply accepting their fate by “making do” with their current employers because of a difficult job market? Which brings us to the employee-end of the talent acquisition spectrum.
How can organizations hire better talent in 2020?
Organizations must innovate and incorporate the latest technologies to attract the right talent:
- Predictive and prescriptive analytics: Organizations must move beyond mere applicant-tracking-systems, and use data analytics and artificial intelligence. Analytics can help forecast workforce requirements, and help take critical build-versus-buy decisions, to suit the business strategy.
- Candidate experience: 2020 will be a candidate-driven market, and employers must offer an engaging and transparent recruitment process. Investing in AI-driven recruitment solutions can help mechanize manual tasks such as candidate updates and screening. Recruiters can then focus on real conversations and connect with potential employees to better engage them.
- Employer branding and recruitment marketing: HR must curate the employer value proposition (EVP) to build an appealing yet realistic picture. More than 75% of job seekers research about a company’s reputation and employer brand before applying*. Marketing oneself as an “employer of choice” means showcasing the culture, values, working ways, policies and processes that resonates with the target-group. For example, to attract digital-natives, the EVP must include posts, videos, and leadership-speak on digital ways of working. Recruiters must market through various channels such as social media, campus hackathons, company webpage, website, podcasts, etc.
- Engagement and retention initiatives: In a competitive talent market, retention statistics may appear high due to the looming uncertainty, but neglecting employee engagement and retention efforts can prove the biggest mistake. Employers must offer more than just good pay- meaningful work, career development, career pathing, inspiring and transparent leadership, learning and development avenues, challenging assignments, global mobility and leadership development. Special focus needs to be given to employees with less than two years tenure, and millennials, since they present the “turnover red zones”. Effective onboarding can go a long way in creating employee stickiness.
Employees who are planning to switch companies cited the lack of career progress (37%) and lack of challenge in the jobs (27%) as the two top factors in influencing their career decisions.
Addressing the talent conundrum is no longer just a recruiter’s job, it requires a holistic talent strategy involving all HR and business functions. The way ahead is to complement technology-skills with softer skills such as leadership and cognitive skills, culture-fit, and hiring for potential. For this, HR needs to relook at the recruitment process and make it more comprehensive at every stage i.e. through sourcing-screening-assessment-selection-onboarding. HR leaders must drive this change by actively seeking CXO buy-in. Revamping talent processes in line with the labour realities is no longer a good-to-have, it is a must-have for organizations that want to leverage their talent and build a competitive advantage.