The shortage of skilled workers remains a hotly debated topic, across all industries. Some see its origin literally in the lack of skilled personnel, others insist on changing requirements of potential employees who are not served by companies and their HR departments. Despite general awareness of the increased demands on personnel management, the shortage of skilled workers seems to remain a long-term trend.
What is changing?
The accusation of being a mere buzzword is on shaky ground when it comes to the shortage of skilled workers. In a recent report by McKinsey, it is listed among the most effective long-term trends in human resource management.
A widely dispersed survey of employees from companies across a wide range of industries reveals a generally lower level of loyalty to employers. According to the survey, 37% of employees were toying with the idea of changing their jobs within the next six months. The acceptance rate of job offers also reflects an intensifying competition for talent, with 35% of offers being made to the candidates being rejected. This new generation of employees generally seems to be shaping their working lives more strategically and with an increased willingness to change.
CVs are changing: While the average number of employers in the baby boomer generation over the course of their entire career was still 1.3, the forecast for Millennials and Gen Z holds out the prospect of a career with around 20 job changes.
Conversely, does this mean that companies and their HR departments are not meeting the requirements of their employees? Certainly, the increased willingness to change also points to a lack of measures for employee retention. Corporate culture scored highly amongst the most important aspects of a job, however, the most important was (perhaps surprisingly) still seen to be financial compensation. When factoring in benefits, this was cited as the number one factor for almost 60% of the employees surveyed, far higher than the 36% HR professionals estimated it as being.
The result is a contrasting picture of the average employee in 2024, which at second glance is quite consistent. Employees seem to be taking an increasingly pragmatic approach to career planning. Money has to be talked about, remuneration is the top priority, but not at the expense of a positive corporate culture. If the chosen employer does not meet your own requirements, the search for the next company follows.
Redesigning the employment package
To some extent, companies may have to live with the fact that their employees are just as pragmatic about planning their careers as companies are about planning their human resources. Accordingly, cultivating a sustainable corporate is becoming a minimum requirement and no longer a guarantee of loyalty for life. Financial compensation remains a decisive factor on top of this and further fuels the competition for talent.
Additionally, companies should be prepared for fluctuation in the workforce. The trends suggest that it is unlikely that employees will suddenly drop their expectations and return to the previous ways of working. Therefore, companies need to be prepared to address absences and departures in different, more creative ways.
Flexible consultants are one way of doing this because they allow businesses to increase their headcount on a temporary basis without the need for time-consuming recruitment processes. Support of this kind is inherently scalable, allowing legal teams to bring in consultants in times of peak workload (e.g. new projects or seasonal spikes).
The combination of a permanent in-house workforce alongside flexible consultants allows an agile response to fluctuations of all kinds within legal teams. This in turn also helps to address the other side of the coin in terms of the workplace culture. Relieving pressure on the core workforce with the introduction of consultants can contribute to a healthier work-life balance as there will be less pressure on each individual within the team.
Conclusion
As employee expectations continue to evolve, businesses have to be capable of adapting to this in order to both remain competitive and manage their workload. The notion that employees care more about culture than compensation is not necessarily true, however, it is clear that culture is still an important factor.
Where employees are tempted to look elsewhere to further their career, businesses must think creatively about how to ensure their team remains in control and filled with expertise. Supplementing the core in-house legal team with a flexible legal resource is one accessible way of doing this.
For further information, please contact:
Henry Hilton, Pinsent Masons
henry.hilton@pinsentmasons.com
