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Written by: Aneela Ali B.A, CPHR
Economic performance and expectations are often the driving force behind decisions made at both a personal and professional level. People tend to invest and spend during times of economic growth and often do the opposite during slower growth periods. The economic health not only affects people at a personal level, but also affects organizations as well. This is evident in terms of supply and demand with many candidates competing for the same positions. As more people are out of jobs during this slow economic phase, there is more supply of applicants for each role, and conversely when the economy is booming there are generally less applicants (low supply) available to fill these roles. This supply and demand principle of course affects Alberta’s hiring confidence numbers.
According to the Alberta Spring 2017 HR Trends report, 67% HR Professionals are much more confident in hiring the right people since January 2016. This is an increase of 6%. This may be more prominent with medium to large organizations, but for smaller organizations there doesn’t seem to be a significant shift in confidence.
Let’s talk about why this may be:
Medium to large organizations took a big hit with terminations without cause, i.e. layoffs. According to 2015 Alberta HR Trends Reports, small organizations showed less expected change in employment than medium and large organizations. When you look at the same results for 2017, HR professionals in these smaller organizations, show less of a difference in expected changes in employment. That being said, it would make sense then that HR professionals in these organizations would not account for a significant difference in hiring confidence. In addition, if the same smaller organizations are expected to increase their headcount, or replace positions by the same percentage, it would make sense that these smaller organizations would have less confidence in filling these same roles.
Industries that have seen an increase in confidence in hiring include, public administration and government, professional services and the oil and gas sector.
It is understood that due to the recent economic slump we have seen a higher supply of skilled individuals looking for work, but if these individuals are now expecting more opportunities, it appears evident that they tend to prioritize companies that are the same size and within an industry that they already have experience with. This may include public administration, professional services, and the oil and gas sectors.
What positions are in high demand?
According to Alberta’s short-term employment forecast for 2016 to 2018, there will continue to be a high demand for positions that include managers in health care, nurses, physicians, child educators, mechanics, agricultural service contractors, farm supervisors and specialized livestock workers. Many of the high demand jobs according to this forecast seem to be in health care, education, trades and agriculture.
Speaking from recent personal experience recruiting for a smaller electronics manufacturing firm, medium high demand positions such as electrical and electronics engineers, computer engineers, software engineers and designers are on the rise.
What are these industries doing to fill these roles?
According to the Western Canada Spring 2017 HR Trends Report, public administration, healthcare and education sectors are more likely to rely on public postings. The reason for this is because these sectors can be unionized and are likely mandated to do so, whether it is through collective agreements, regulations or legislation.
Medium and large organizations, as opposed to smaller organizations, are less likely to rely on alternative recruitment methods without posting publically. Smaller organizations are posting publically and using other sourcing methods like medium to large organizations, but they also show the highest percentage of solely utilizing alternative methods without posting to fill vacancies.
With high and medium to high demand positions, it is critical to use many methods to attract and retain the best candidates for your company’s role. It makes sense given the high competition with other organizations that smaller companies are looking for alternative methods to recruit the best candidates. Alternative sourcing may include searches on recruiting websites (similar to LinkedIn), employee referrals (which has proven to be a most effective method), and going back to previous openings to search a database of resumes with candidates that may fit current positions. Of course, smaller organizations also have a tendency to use outside recruitment or search agencies to assist with filling their current roles. This can get expensive and may or may not bring much value for your dollar.
Confidence in replacing positions with right experience and qualifications
The Alberta Spring 2017 HR Trends Report indicated that hiring confidence to fill positions with experience and qualifications as needed has shifted higher with administrative, tradesperson or journeypersons at percentages of 50% or more to fill a positon within less than a month, and over 40% between one month and three months. The next highest levels are technical staff and professionals at around 30% for filling vacancies less than one month, and over 50% between one and three months. Managers and executives are at the lower percentage for filling in less than one month as these roles may require more effort to fill.
As the economy starts to shift to a more economic recovery and growth position, I can see these percentages declining in the next year. A period of hire for a specific role that may have been filled in one to three months could shift to a time period of three to six months to fill instead. This of course will be due to a lower supply of candidates within these special positions.
Personal experience replacing and hiring professionals with the right experience and qualifications
In the electronics manufacturing realm within a smaller organization, I have seen an increase in qualified applicants for each administrative, professional and even management to executive roles. Where a job posting may only obtain 20 to 50 applicants in the past has now increased significantly to 100 to 200 applicants. Due to job losses, you tend to see more qualified and skilled individuals competing for the same types of jobs. The expectation then is that companies can hire top candidates within their desired positions. These professional roles may include accounting, marketing, HR, and sales etc. My current hiring endeavors have shown me that those high to medium demand roles, such as electrical and software engineers for example, are still a struggle to fill. Although there are more people out of work, it seems that those niche positions that are in high demand are not bringing in as many prospects as one would expect. Thus, there is a lower supply of candidates for these specific positions. That being said, when these types of positions are filled, the most important thing is to retain the individual.
Higher demand positions require retention.
So with high demand comes a greater need to retain these employees. Although confidence has increased, companies need to find ways to keep these high functional A grade employees from leaving. Since smaller companies will be competing with medium to larger companies for these same employees they need to offer something that other organizations cannot.
With the smaller organization I’m currently hiring for, two items of note have come to my attention. First, is that one of the most attractive features of our company is the technology and growth that it offers. Candidates have commented on how interesting and innovative our products are. For a software or an electrical engineer, it may prove as an incentive to be a part of a product life cycle with new innovations. Secondly, is something I’ve noticed in both my current and previous organizations. Employees in smaller organizations are more likely to wear more than one hat. For some individuals that can be very attractive. An engineer may not be specific to one project, but may be involved in various projects where he or she can add knowledge and depth. Many candidates within the professional realm have commented on how they like to expand their duties and are impressed with how exciting it is to them that the job entails a wide breadth of duties to use their skills and ability. In other words, those individuals are happy to be challenged with a range of involvement in different roles. When looking at smaller firms, or those firms regardless of size, that want to market their opportunities, I have found that the excitement of the company’s technology and having a great breadth to these positions have been attractive to candidates, and it should be marketed as such when recruiting potential candidates. So the questions remains, what does your organization offer, and how can you make it attractive to your candidates? Perhaps it is the technology, product or even the culture of your organization that can be the deciding factor for someone to express an interest. In essence a company’s brand (Employment brand) should be focused on not only attaining customers, but to attain future or potential employees as well.
Three ways to retain your employees:
It is not enough to simply bring in candidates and fill positions you must also ensure that you are retaining qualified individuals. According to the HR Trends Report of Spring 2017, there are three significant ways to retain your good employees in addition to the ones mentioned above.
1. Better On-boarding – organizations must have good systems in place to on-board these new employees, which include ensuring they are set up properly, conducting an in depth orientation and listening to what employees need.
2. Flexible Work Arrangements – if organizations are able to offer these arrangements with flexible times of working or potential to work from home occasionally, this can make an employee feel valuable. Past experience with organizations I’ve recruited for has shown me that maintaining higher retention rates is correlated with providing a flexible environment. Individuals with families or other interests that take up their off duty time may especially appreciate it, because it allows them to have that life work balance.
3. Team Building - if your organization is offering these programs within your company, it can prove to be effective not only by allowing the team to socialise, which they may not have had the opportunity to do so before, but to get to know each other in different ways; this may also add to the productivity of the team as a whole.
With all of these points one can conclude that you need to offer programs in your organization that not only attract potential candidates, but retain them. With a promising economy shift, these same positions will be harder to fill in the future. It will especially be more difficult to fill those higher to medium demand positions. Thus, the hiring confidence rate will be affected, and as the economy grows, organizations need to be prepared for this shift, and be ready when the supply of good candidates start to deplete, thereby enforcing the need to be more aggressive with recruitment methods.
Alberta HR Trends Report – Spring 2017, Human Resources Institute of Alberta
Western Canada HR Trends Report – Spring 2017, Human Resources Institute of Alberta
Alberta’s Short-term Employment Forecast 2016-2018, Alberta Government (www.alberta.ca)