Facing a diminishing supply of applicants in a job market where candidates hold nearly all the cards, business leaders and HR professionals have been forced to rethink how they attract, engage, hire and advance members of their workforce.
According to the iCIMS 2022 Workforce Report, 90% of business leaders believe a skilled workforce is important to their efforts, while more than 80% said they’ve been negatively impacted by the mass of workers leaving their jobs as part of “the Great Resignation.”
An accompanying survey found that only 11% of American adults believe their employer was not short-staffed last year because of pandemic-related labor shortages.
Among the report’s key findings:
- The gap between talent supply and demand is growing. At the close of 2021, there was a 97-point gap between job openings and job applications, the widest seen in the previous two years. iCIMS data shows that job openings are up 86%, while hires are up 45% and job applications are down 11% from pre-pandemic levels.
- Salaries will continue to increase. C-level business leaders said their organizations plan to increase salaries by about 7% on average this year to incentivize retention. Nearly a third plan to increase salaries by more than 10%. The consumer survey found that people will also stay with their current employer for benefits, flexible schedules and professional growth opportunities.
- Flexible workforce is here to stay. As competition for labor intensifies, so does the expectation of flexibility for work location and schedules. In 2021’s fourth quarter, one in five applications were from out-of-state. Some of the most common moves include offering flexible daily work schedules (43%) and offering remote work options to distant (38%) and local employees (36%).
In addition to talent shortages, employers are struggling to keep up with expectations surrounding DEI, retention and internal mobility, iCIMS said.
Among the issues:
- Failing to keep DEI at the top of the list. Over the last few years, many business leaders pledged to increase the diversity of their workforce. But in the current job market, DEI often falls down on the priority list. Most HR professionals (70%) expressed concern that their organization’s HR technology isn’t helping them meet their DEI goals. Meanwhile, 85% of CxOs said they struggle to prioritize DEI goals against competing HR and recruiting needs.
- Retention is a challenge, but still not top priority. Nearly two out of three CxOs are putting greater emphasis on hiring talent over retaining existing employees. In the past year, only 29% of HR professionals have prioritized internal mobility, the report found. That represents a missed opportunity for most employers, since companies that prioritize career pathing are seeing a positive impact.
The report also found that the staffing plans of 57% of companies project no further than a quarter out.
By Mark Feffer
Mark Feffer is executive editor of RecruitingDaily and the HCM Technology Report. He’s written for TechTarget, HR Magazine, SHRM, Dice Insights, TLNT.com and TalentCulture, as well as Dow Jones, Bloomberg and Staffing Industry Analysts. He likes schnauzers, sailing and Kentucky-distilled beverages.
Weekly news and industry insights delivered straight to your inbox.