A shrinking pool of qualified candidates surfaced as a top business risk for global executives in risk, audit, finance, and compliance, according to a recent survey by Gartner, Inc. In a time of historically low unemployment where the supply of available workers is much lower, organizations are struggling to find and retain the talent they need to meet their strategic objectives.
At No. 3, behind accelerating privacy regulation and cloud computing, this is the first time talent shortage was named a top business risk in Gartner’s quarterly Emerging Risks Report.
Cloud computing, which was ranked the No. 1 risk in 2Q18, remains a concern. Cybersecurity disclosure and the artificial intelligence (AI)/robotics skills gap round out the top five concerns among executives surveyed.
“In this strong economic environment of significant business growth and record-low unemployment levels, the battle for talent is heating up as employees now have more bargaining power,” said Matthew Shinkman, practice leader at Gartner. “As a result, talent is harder to find and even more difficult to keep.”
In the U.S. alone, the number of unfilled jobs rose by 117,000 to 6.94 million from June to July 2018, based on the most recent Job Openings and Labor Turnover Survey. And in the U.K., the unemployment rate is now at its lowest level in four decades, according to the Office of National Statistics.
As business leaders feel the squeeze, the pressure on recruiters continues to intensify. In a Gartner survey of 400 executives on their level of satisfaction with their organization’s ability to attract and retain high-performing talent in the current environment, only 26 percent reported being very satisfied or satisfied.
Digital transformation initiatives have only increased this pressure by creating immense competition for workers who are skilled at navigating the increasingly digital environment.
To mitigate the risk of talent shortage as competition for workers continues to rise, leading organizations are shifting how they source talent. Most recruiting professionals have a needs-driven approach to finding talent, setting the sourcing strategy to fulfill the defined needs of the organization. Instead, Gartner recommends a market-driven approach that ensures the sourcing strategy adapts to evolving external labor market realities and organization needs. This approach includes the following hallmarks:
Recognize (mis)perceptions that limit access to talent pools, and actively address them.
Understand prospective candidates’ decision-making process, and act as a career coach.
Optimize the search criteria to redefine and expand the available talent pools.
Reorient learning and development to close skill gaps that exist because of digital transformation.
“In today’s tight labor market, where employees have the upper hand, workers are more willing to look for a job with better pay, more generous benefits, and defined career development opportunities — or all three,” says Brian Kropp, Gartner HR practice group vice president.
“To retain your best employees, companies need to better understand what matters most to them and help them see how they can advance in their careers with their current company, especially if wage growth continues to remain stagnate,” says Kropp.