In this age of low U.S. unemployment rates and increased talent competition, 54% of employers surveyed in Brandon Hall Group’s recent research believe there is a shortage of qualified talent in their industries. But to what extent is this belief prevalent among typically high-turnover industries (technology and software, retail, manufacturing, healthcare, and hospitality)? And can high-turnover industries teach us something in terms of managing a talent shortage?
Using Brandon Hall Group’s 2015 Talent Shortage/Hiring Practices study among 355 human capital management leaders, I decided to dig into a few data points to answer those questions. However, as a caveat, hiring practices are not the whole story about how to manage talent shortages. There are location-selection strategies, competitive moves, and other factors that can impact an organization’s ability to attract talent in a tight market, and those topics were not the focus of this study.
Feeling the Same Pain
To begin with, everyone seems to be feeling the same pain. The same percentage of respondents from high-turnover industries and remaining respondents (54%) believe there is a talent shortage. However, a greater percentage of high-turnover respondents than other respondents report struggling to fill key roles because of the industry talent shortage (33% high turnover vs. 25% other). In addition, at least a quarter of the high-turnover (32%) and other (26%) respondents are not sure whether there is a talent shortage but agree it has gotten increasingly difficult to find, attract, engage, and hire high-quality candidates.
Both segments are experiencing the same hiring challenges: attracting talent (66% high-turnover, 62% other), building external talent pools (45% high-turnover, 46% other), and making competitive offers to top talent (38% high-turnover, 41% other).
What to Do?
So what is a company to do when faced with a shortage of qualified talent and a struggle to attract talent? How about targeting recruiting efforts for specific talent communities? When comparing the two segments, more high-turnover respondents than other respondents make at least some effort to recruit from specific communities, such as millennials (67% high turnover vs. 56% other), university-based groups (86% high turnover vs. 75% other) , and military veterans (63% high turnover vs. 57% other). I find this surprising because most organizations could benefit from developing strategies to recruit from these talent populations. The millennial population, in particular, is plentiful in the U.S. Millennials (born between 1982 and 2000) represent more than one-quarter of the population and number 83.1 million (Source: U.S. Census, June 2015 press release).
How About Sourcing?
In terms of sourcing strategies, a greater percentage of high-turnover respondents than others invest time and resources on direct sourcing (78% high turnover vs. 65% other) and employee referral programs (75% high turnover vs. 62% other). Employee referral programs are a highly effective way to recruit talent. In fact, Brandon Hall Group’s 2015 Talent Acquisition Survey shows that, on average, all organizations fill about 17% of their job requisitions from employee referrals, which is the second highest percentage after general job boards, at 18%.
Looking to the future, the top responses for the three most-important changes an organization could make to improve their recruiting performance are:
- Strengthening their employer brand (65% high-turnover vs. 55% other)
- Updating and modernizing sourcing strategies (54% high turnover vs. 46% other)
- Improving the onboarding process (48% high turnover vs. 45% other).
To me it is no surprise that strengthening an employer brand is the top response because conveying authentic messaging about an organization’s employer/employee relationship is very likely to attract quality talent that is aligned with the organization’s values, mission, and culture.
The bottom line is, most organizations are experiencing a shortage of quality talent and are struggling to attract talent. What distinguishes high-turnover industries from other industries is that a greater percentage of them make an effort to recruit from specific talent communities, especially millennials and veterans; utilize employee referral programs and direct sourcing; and place emphasis on their employer brand. These are strategies worth emulating.
–Daria Friedman, Principal Analyst, Talent Acquisition, Brandon Hall Group