Months after the ‘great resignation’ gained traction, companies are still struggling to hire the right skills. Euan Cameron from Willo looks at why employers must rethink diversity in hiring to find a solution to their staff retention challenges.Â
The greatest challenge facing employers at present is not the cost-of-living crisis, rising energy prices, or record interest rates. It’s holding on to staff.
Loyalty used to be one of the most coveted qualities in an employee, with workforces wedded to a company sometimes for generations.
Recent, well-publicised statistics show staff sickness is at 10-year high in the UK, with stress one of the principal drivers. There was once a time when staff would have ‘stuck it out’ under these circumstances – the tide, however, is turning.
And that’s no bad thing. The world of work has evolved – particularly post pandemic – with workers now in possession of far more freedom, choice, and access to new employment opportunities through flexible, hybrid, and asynchronous working practices.
If a job doesn’t suit, it’s no longer necessary to tough it out, you can easily move to pastures new – and it doesn’t need to be in the same city or even country.
On the move
Statista figures show the estimated number of job-to-job resignations in the UK jumped from almost 125,000 per quarter to 335,000 p/q in the 10 years between 2013 and 2023 – peaking at more than 440,000 per quarter during last year’s ‘great resignation’.
It’s commonly thought younger generations are more likely to move jobs, with an emphasis on gathering varied experience in different places rather than climbing a ladder at one organisation.
A study published this month by recruitment consultancy Resource Solutions found Gen Z workers expect to change careers three times in their career, while a US survey conducted by Censuswide in December last year found 72% of Gen Z respondents and 66% of millennials surveyed planned to leave their jobs in 2023. That compares to just 55% of Gen X and 30% of ‘Baby Boomers’.
Rethinking retention
‘Accidental managers’ are driving attritionÂ
Does that indicate a dwindling sense of loyalty, or is it more about a shift in what’s important to them?
Changing incentives
In the not too distant past, companies had devices and mechanisms designed to tie people into long-term employment – final salary pension schemes, company cars, generous healthcare plans, but to all intents and purposes these are relics of a bygone age.
More recently, employers have invested in making the workplace a better place to be, with staff wellbeing and benefits from progressive steps such as mental health support to head turners like free food, table tennis, or even beer taps.
This is progress, but as the cost of business has increased over the past 18 months, these perks and benefits have begun to scale back or even disappear.
So what’s the solution? Perhaps employers need to shift what’s important to them too.
Many leaders have spoken of a need to improve staff retention, and some have taken measures to do so, which include resorting to salary-driven bidding wars to secure the best talent.
They’d be better served shifting their focus to broader talent acquisition, and in particular breaking barriers and biases around age, disability, or socio-economic background.
New demographics
Let’s take age. Recent research from the Centre for Ageing Better suggests there are more than one million more people in employment past the age of 65, amounting to 11.5% of the UK population.
However, a high proportion of those are on zero-hours contracts (second only to 16-24 year-olds) or self-employed, which experts suggest could be a symptom of continued age discrimination.
A survey conducted by campaign group Silver Voices this year found more than 86% of over 60s have faced discrimination in UK workplaces. It goes further, age discrimination means that over-50s are more than twice as likely as other workers to be unemployed for two years or longer if they lose their current job.
It’s a common and immensely patronising misconception that older workers aren’t suitable for the modern workplace due to a lack of understanding of new working practices and technology.
That doesn’t chime with my experience. It’s a small indicator, but there is no disparity in the average time it takes people to complete a job interview via our platform – regardless of age.
Older generations are just as adept at dealing with tech as their younger counterparts – and underestimate the older workforce at your peril. The same goes for people living with disabilities, or from different ethnic or socioeconomic backgrounds.
Ingrained bias
By denying yourself access to these rich seams of talent, employers are missing out on potential employees that could be a point of difference for their business.
I recently had a conversation with Katy Morrison, an EDI specialist at Connect Three – a UK-based leadership consultancy.
She says too many firms are still reluctant to hire talent outside traditional pools over fears it will impact their ability to do business, due to ingrained bias developed over time, or a misplaced perception that hiring for diversity is ‘fluffy’ or a ‘tick box’ activity.
That’s despite her assertion that proactively searching for talent outside traditional pools – including over 50s, people with disabilities, and people from BAME or working-class backgrounds – diversifies a team as well as strengthening it.
As an expert who works in this field every day, she says too many firms fail to understand the ROI in diversity. What’s more, there’s a perception it takes extra effort to actively look in more diverse talent pools and a fear it will disrupt the way organisations usually search for talent – so too many revert back to what’s always been done.
The reality employers must accept is that workers will continue to move on more readily than they have in previous generations – and that will not change.”
But, as Morrison argues, hiring from more diverse talent pools brings different skills and fresh concepts to the table, generates new ways of working that can propel a business forward, and also helps to attract more new and diverse talent to an organisation which provides a competitive advantage.
Expand the hiring pool
Similarly, the pool of people with disabilities is large, and often overlooked. According to UK government statistics, there are 7.7m people in the UK of working age with a disability or health condition.
It’s estimated more than 1.2m of them are currently looking for a job. What’s more, stats from US charity Celebrating Disability suggest companies keen on hiring disabled employees tend to outperform others, with profit margins around 30% higher, net income 200% higher, and 28% higher revenues.
The reality employers must accept is that workers will continue to move on more readily than they have in previous generations – and that will not change.
Staff retention is no longer a game of decades and instead about keeping people for three or four years max.
The key is appropriate succession planning and identifying new talent that can fill the gap left by those who leave. Employers must ensure misplaced perceptions around age, ethnicity, or background have no place in their hiring operations.
By opening their eyes to talent pools that too many ignore, companies can effectively and efficiently find staff without paying inflated prices for average people. What’s more, they will make their organisations more attractive to new talent, and more effective overall in the long-run.
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