Analysis
By s1jobs
The number of people out of work and looking for a job has fallen again, according to last week’s figures from the Office for National Statistics, putting yet more pressure on organisations struggling to hire across nearly every sector of the economy.
UK unemployment declined by 0.2 percentage points to 3.9% during the three months to January, beating estimates of 4%. In Scotland, joblessness fell 0.3 percentage points to 3.8%.
Both are approaching their pre-pandemic levels, when the lows recorded in late 2019 represented the best jobless figures since 1974. At the same time, research from Deutsche Bank suggests the “quit rate” of UK employees leaving their jobs is the highest on record.
It’s therefore no surprise that the second annual workforce report published by talent cloud company iCIMS found a roughly even split between HR professionals who are most concerned about hiring new staff, and those whose greatest worry is retaining talent. Asked which would be the bigger challenge in the coming year, 56% opted for the former and 44% for the latter.
According to iCIMS, there was a 97 point gap between job openings and job applications at the end of 2021, the widest seen in two years. Job openings were up 86%, hires were up 45%, and job applications were down 11% from pre-Covid levels.
Even before the pandemic, many employers were struggling to find the right staff. Hiring for transferrable skills and looking within your organisation can help bridge this gap, but many businesses are not considering this option – only 20% of UK firms implemented internal strategies to attract and retain talent in 2021.
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Looking to the future, 92% of businesses say they will not meet their goals unless they’re able to secure the necessary talent. Doing so is becoming an increasingly expensive endeavour, with nearly a third of organisations saying they plan to increase salaries this year by 10% or more.
Focusing on diversity provides access to a wider pool of talent and bestows other competitive advantages: research has shown that those with a diverse workforce are 1.6 times more likely to meet their financial targets. Meanwhile, there are continuing expectations that flexible working will remain part of the employment offering.
All these insights from iCIMS suggest that success in 2022 depends on a holistic approach that takes account of everything – hiring processes, internal advancement, diversity and flexible models – in the quest to secure increasingly scarce skills.
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