6 Reasons You Should Care About the Talent Shortage
Whether you call it a talent shortage, a scarcity of skilled labour, or a tight applicant market — the end result is the same: longer recruitment cycles and increased costs. But that’s not where the impact ends.
As we reported in Lack of Skilled Workers In Trades Costing Billions To Canadian Economy, “the domino effect of a few unfilled positions goes surprisingly deep.”
What Employers Are Saying
In a recent ManpowerGroup survey, 32% of hiring managers in Canada and the U.S. said they’re having difficulty filling positions. Skilled trades, for the fourth consecutive year, tops the list of most difficult jobs to fill.
Even more telling are these statistics from the Canadian Manufacturers and Exporters Management Issues Survey:
More than half (58%) of MIS respondents said that finding the people they need is among their most pressing business challenges — and 56% say they’re already facing labour and skill shortages.
6 Ways the Talent Shortage Impacts Organizations
Payroll costs make up approximately 70% of a typical business’s cost structure so it’s no surprise that maintaining adequate staffing levels is a critical function.
What happens when an organization is unable to fill positions quickly? Here are the business impacts of the current talent shortage as reported by 14,000 hiring managers in the ManpowerGroup survey.
39% – Reduced Ability to Service Clients
37% – Reduced Competitiveness and Productivity
30% – Increased Employee Turnover
25% – Higher Compensation Costs
23% – Lower Employee Engagement or Morale
18% – Reduced Innovation and Creativity
What You Can Do About It
- Be prepared to move quickly when qualified talent expresses interest in your job openings.
- Review your compensation structure to ensure it aligns with current market conditions. You’ll find several reliable sources of Canadian salary data in Salary Surveys — Getting Compensation Right.
- Launch an employee referral program.
- Improve retention by defining and recognizing success.
- Consider building flex time into the operation as a way of increasing the attractiveness of your jobs (see Childcare and Women in the Workforce).
- Grow your own internal talent pool through training and coaching.
- Establish a relocation policy for hard-to-fill positions. This will reduce the time it takes to make an offer which may help you secure the talent your business needs to move forward.