International HR: recruitment trends

As budgets are squeezed in the economic downturn, many global organisations are facing difficult recruitment challenges and searching for more cost-effective and innovative ways to fill job vacancies.

Few of us were surprised when one of the most powerful men in the UK, the governor of the Bank of England, confirmed in October that we’re on the brink of a recession. Mervyn King admitted that our banking system had come closer to collapse than at any time since the beginning of the First World War and that the UK is facing an extended and painful downturn.

But it’s not just Europe and the US that are affected. As recruitment budgets are stretched tighter, many global organisations will be looking to find more cost-effective and innovative ways to fill job vacancies.

Eric Lochner, managing director of Kenexa (Europe, Middle East and Asia), a global recruitment and retention specialist, says: “HR directors are trying to understand what the recession means for their business and strategise accordingly. This market upheaval and lack of visibility affecting all sectors. We’re in a state of unknown.”

Despite the precarious nature of the economy, the majority of businesses across the globe will still be looking to recruit, experts predict, especially in growing economic areas such as the Middle East. And the downturn in the UK and the US could actually trigger a surge in international recruitment as jobseekers consider relocating to a different country to find work.

Global job hop

Economist and founder of consultancy Business Economics, Bryan Finn, says: “Employers are cutting back on budgets but there are more applicants than ever, so lots of HR professionals will see an increase in their workload.

“There’s also much more appetite for going to work overseas and the upsurge in technology has meant it’s easy for multinationals to recruit on a global basis.”

Some emerging economies are finding that the financial crisis in Europe and the US could actually work in their favour when it comes to recruitment.

Lochner explains: “Companies will take talent from anywhere in the world if they can get it. Countries like Dubai are, in some ways, taking advantage of the downturn by recruiting skilled managerial professionals they wouldn’t necessarily have been able to before.”

Skills shortages in certain geographical areas, such as India and China, and in some industry sectors, including mining and engineering, could also play a part in the global job-hopping trend. Stephen Dixon, global head of talent at Dufry Management, a retailer based in Switzerland, points out that it can be much easier to get a senior level job in certain countries.

“In Europe, we’re still very focused on skills and using traditional recruitment methods and processes,” he says.

“But employers in places such as Dubai are much more open and look at what experience you can bring to a role rather than just the skills you have.”

Dixon believes that employers need to adapt their recruitment processes to match the attitudes and expectations of the next crop of graduates.

“As Generation Y workers [those born in or after 1980] start to enter the workforce, recruiters are going to have to be more attuned to job hopping,” he says.

“Lots of UK employers are still measuring the wrong metrics – such as cost and turnover rather than the time it takes to deliver and bring someone on board. But more and more young people are looking to move jobs every 18 months or so now. And if you have a natural turnover of 30% you’re probably going to get lots of new ideas and a fresh perspective.”

Carl Gilleard, chief executive of the Association of Graduate Recruiters (AGR), says one of the major challenges for employers over the next 12 months will be sifting through hundreds of applicants to find the best people.

The danger, Gilleard believes, is that students will start panicking about getting a job after their finals and apply for anything going. For employers, it will be a case of getting the numbers down.

“Companies certainly aren’t going to suffer with a lack of applicants, but there won’t necessarily be enough jobs to go around. The ratio of graduate applicants to jobs this year was 30:1 so it’s going to be a major challenge to work out who and how best to recruit next year,” he explains.

“The graduate recruitment market almost came to a halt in the last big recession in the early 1990s, but hopefully it’s not going to be the same this time and businesses won’t start closing down recruitment programmes and cutting back. We’re holding our breath,” says Gilleard.

Online approach

Fortunately, the rapid development of Web 2.0 technology will help recruiters manage the onslaught of applications. Gilleard estimates that at least two-thirds of UK employers have an ‘online only’ recruitment policy and believes the rest will eventually follow.

“There’s a greater emphasis on employers to be more transparent about their recruitment processes and what they’re looking for and an online approach enables them to do this,” he says.

Finn points out that it is almost impossible to underestimate the impact of the online revolution on a global level.

“Technology has had a huge impact in terms of security and flexibility,” he says. “It helps employers sift through masses of applications and get the right candidates.”

And the surge in social networking sites is also playing a big part in screening job applicants before interview, says Lochner.

“It’s fairly common to check candidates out on social networking sites such as LinkedIn and it’s certainly something that managers in the UK, US and Western Europe are doing,” he says.

However, although it may seem as though e-recruitment is commonplace now, the UK is still significantly more advanced in this area than many other countries.

Lochner explains: “Everyone thinks e-recruitment is pretty well ingrained, but it’s actually not. Only a very small percentage of the working population uses online recruitment. In China, for example, recruitment is still very much a paper-based activity.”

On a global level, employers are using a range of recruitment methods, from the more traditional (filling in an application form and carrying out an interview) to the novel. In Spain, for example, some companies use instant messaging to attract new candidates – jobseekers see the company’s billboard and text their details if they like the sound of the role. In India, meanwhile, prospective jobseekers enter their CV data and answer screening questions in specially designed kiosks.

The army is also becoming increasingly innovative in its recruitment methods and is targeting new recruits with interactive computer games. Aspiring soldiers in both the UK and the US can take part in virtual conflicts and role plays via a website.

But do these innovative recruitment methods mean the old-fashioned face-to-face interview is being slowly phased out? Apparently not.

The human factor

“Lots of companies I speak with are still very active in terms of face-to-face recruitment as there is still a need for the human approach,” Gilleard says.

“Employers are also using real case studies of people who are already doing the job, both online and at recruitment fairs. They can tell people about the role and what’s expected of them,” he adds.

Lochner believes that, ultimately, there will never be a substitute for face-to-face interviews. “I can’t imagine that face-to-face interviews will ever not be important,” he says.

But how long it will take the UK and the US to recover from this recession is still open to debate.

Finn says: “Very few people understood just how bad it was going to be after the housing downturn in the US and the Northern Rock crisis. We’re in paralysis.”

“It’s obviously more acute in the UK and the US, especially within the banking sector, but we have quite a flexible labour market and we should bounce back fairly quickly. We don’t have the legislation overhang of other European countries – such as France and Italy, which are notoriously bureaucratic and can slow things down. Hopefully that won’t be the case in the UK,” Finn adds.

Employee confidence across the globe

Although they may not necessarily be recruiting, and despite the economic downturn, most UK workers (67%) still have faith in their employer, according to research by global recruitment consultancy Kenexa. The company assessed employees’ organisational confidence both internally and externally. The study included 16,000 employees from 12 countries, 1,000 of which were from the UK.

Two-thirds of UK employees (67%) believe their employer will remain buoyant, but employees in India have the highest level of confidence at 81%. US workers came second at 76%, followed closely by Brazil at 75%. Russia and Canada are also reasonably optimistic, with 74% of employees in both countries remaining confident. Japanese employees have the lowest level of confidence at 46%.

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