Recruiting, retaining good workers won’t get any easier in 2017
This is the time of year when prognosticators peer into their crystal balls and provide us with a look into the upcoming year. While I’d never claim to be skilled at predicting the future, I can tell you that from where I sit and from what I hear from my clients, finding talented workers will likely remain a challenge in the new year.
When it comes to official forecasts, the Governor’s Office of State Planning and Budgeting released its latest economic data in September and called for tight labor market conditions to continue. Colorado’s unemployment rate was 3.8 percent in October, higher than earlier in the year, but still well below the national average of 5 percent.
I’ve talked a lot this year about the various strategies employers are using to attract and retain professionals in light of the state’s labor shortages. With quality talent expected to be in short supply again in 2017, here’s a look at the recruitment and retention trends that I expect employers to embrace. • Increased hiring of contract/
freelance professionals. Call it the expansion of the “gig” economy. For a few years now, employers have depended more on contingency workers to fill project needs or help achieve specific goals. These types of workers give employers the ability to ramp up when they need to most, with professionals who are highly skilled and don’t carry the same costs as full-time employees. Contingency workers may become more important depending on the fate of a new Labor Department rule that would make more salaried workers eligible for overtime pay. Last month, a federal judge blocked the rule from taking effect. In any event, the software company Fieldgrass, which has surveyed companies on the use of freelancers, expects that by next year, the average businesses’ workforce will consist of 25 percent contingency workers and 41 percent traditional full-time employees, with the remaining group fitting into both categories and possibly working remotely or part-time.
• The rise of returnships. This is another great way for employers to gain access to highly-qualified workers who are eager to update their skills after a break from the workforce. Like traditional internships, it also gives an employer the opportunity to test a prospective employee before making them a permanent hire. The arrangement varies by employer in terms of length and pay, with some participants becoming full-time employees after the program. Goldman Sachs is a returnship pioneer, having launched its program in 2008. But several other companies have followed in the years since, including Morgan Stanley, General Motors and GoDaddy. • Greater acceptance of boomerang employees. In the old days, when an employee left a company, they essentially cut ties for good. But with good talent hard to come by, employers are now more open to the idea of welcoming back former employees who left for other opportunities or retired altogether. WorkplaceTrends.com surveyed more than 1,800 human resource professionals and found that more than half give higher priority to candidates who were for- mer employees who left in good standing. Of those who received applications from former employees, 40 percent said they hired about half of the former employees who applied. Former employees are preferred, said survey respondents, because they require less training and are familiar with the company’s culture. • More focus on screening. Since recruiting takes up precious time and resources, employers want to increase their chance of landing the right fit the first time. As a result, more organizations are employing personality tests and other screening mechanisms to weed out candidates who won’t make the cut. In 2014, 62 percent of HR professionals were employing personality tests to vet candidates, according to the business advisory firm CEB. That’s up from 2010, when less than half of hiring managers were utilizing personality assessments. While some of these tests have been around for decades, I expect them to be used more frequently as employers search for ways to ensure a good match. Asking applicants to create video presentations or interviews of themselves is also becoming more popular, particularly among employers who want to see first-hand if a candidate will fit their culture before they’re invited in for an interview. • Better engagement efforts. As millennials become a bigger portion of the workforce, companies will need to increase their efforts to connect these younger workers to the organization’s culture. I am already seeing this with some of my clients, who have replaced annual or semi-annual reviews with more frequent feedback sessions (which millennials often crave) and have provided younger professionals with a clearer path to promotion. A friend who works for a start-up notes that her firm engages employees by offering transparency and communicating regularly about challenges and changes in strategy. Companies are also trying to engage employees through expanded benefits, including flexible schedules and perks such as free lunches and ski passes. This is an evolving area, so I anticipate that companies will continue to throw a lot of different approaches at the wall until they find something that sticks.
Although it will likely remain a seller’s market next year, the buyers — or in this case employers — will have high expectations for the professionals they bring into the fold. New hires will be expected to contribute quickly without a lot of hand-holding. While younger workers might get a bit more slack because of inexperience, the honeymoon period for new recruits will be a lot shorter than in years’ past. Here’s to a productive and profitable 2017 for Colorado businesses.