Talent Acquisition Newswatch - Issue 1.76
TOP STORY
Generative AI tools are not expected to fully replace workers or manage tasks without prompts, according to a recent presentation by Indeed's chief economist. An analysis by Indeed indicated that generative AI is unlikely to replace most work skills, especially in-person roles like cooks, drivers, and nurses, with technical or computational fields being more susceptible. Despite some assistance in repetitive tasks, generative AI is unlikely to fully master occupational skills without human oversight. HR professionals can utilize AI tools to support a skills-first hiring approach, but human skills remain essential in tasks like assessing and interviewing candidates.
COMPENSATION & BENEFITS
Implementing pay transparency best practices can help organizations maintain a competitive edge in the talent market and go beyond just legal compliance. Integrating pay transparency into the Employee Value Proposition (EVP) can enhance fairness and trust in compensation, leading to increased job satisfaction and better retention rates. Conducting regular pay analyses, developing a compensation philosophy, establishing pay bands, including concise pay ranges in job postings, and providing training to managers on fair pay practices are crucial steps towards achieving fair and equitable pay within an organization. Regularly re-evaluating salary ranges, enhancing employees' understanding of benefits, and maintaining consistent guidelines and criteria for performance ratings and salary increases are important practices to ensure fairness and competitiveness in compensation strategies.
For 2025, compensation planning trends highlight an increased integration of ESG factors, with companies linking executive pay to sustainability and social responsibility. There's a shift towards balanced compensation, focusing more on long-term incentives like performance-based stock options. Data analytics are increasingly used to ensure pay equity and performance alignment, while employee well-being is prioritized through flexible work, mental health support, and engagement benefits. Globally, companies are addressing regional compliance and cultural differences. Corporate directors play a critical role in ESG oversight, monitoring ESG performance, managing related risks, and communicating strategies to stakeholders, reinforcing organizational commitments to sustainability.
DIVERSITY, EQUITY & INCLUSION
Empathy is essential for building inclusive workplaces that drive innovation, adapt to change, and better serve customers and employees. Three key ways to foster empathy in the workplace are listening with empathy, demonstrating authenticity, and practicing social sensitivity. Leaders can activate empathy by creating a safe space for employees to address uncomfortable issues, thus building a workplace rooted in respect and inclusion. Pitfalls of empathy include reinforced biases, empathy fatigue, and empathy episodes, which can be mitigated by taking different perspectives, self-care, and focusing on how empathy contributes to inclusivity.
Ageism affects people's advancement in the workplace, and while traditionally associated with older individuals, new research highlights how younger women may face age-based discrimination more than young men and older workers of any gender. The Women In the Workplace Report 2024 reveals that nearly half of women under 30 feel negatively impacted by their age at work, with younger women more likely to receive unwanted comments about their age compared to men of the same age. Issues like 'Youngism,' sexual harassment, and the 'broken rung' contribute to the underrepresentation of women in leadership roles, emphasizing the importance of combating ageism, sexism, and racism simultaneously in creating equitable workplaces. Despite some progress in women's representation in leadership positions, challenges like companies wavering on diversity commitments and prevalent sexual harassment show the need for sustained efforts to advance gender and racial equity in the workplace.
HR INSIGHTS
Sick leave in the UK has increased by 41% over the past three years, contributing to a decline in productivity levels for businesses, according to a survey of 1,000 HR decision-makers by TotalJobs. Factors such as absenteeism, increased workloads, difficulty attracting talent, and low morale are identified as drivers behind declining productivity, leading to high employee turnover. To address these issues, HR leaders are implementing strategies like offering flexible working options, investing in training, enhancing communication, and conducting regular wellbeing assessments to tackle stress and burnout. Challenges in filling workforce gaps include shortages of suitable candidates, limited budgets for replacements, and lack of clear communication from senior leaders, impacting hiring confidence and causing uncertainty in the UK job market.
A new report by Enboarder reveals that 25% of employees surveyed in the US, UK, and Australia were dissatisfied with their most recent onboarding experience. Enboarder CEO, Dan Finnigan, emphasized the significant impact of onboarding experiences on employer brand, employee satisfaction, and overall performance. The study highlights a common trend of onboarding programs not meeting employee expectations, leading to negative consequences for companies. This dissatisfaction with onboarding experiences is identified as a factor contributing to reduced efficiency and effectiveness in the workplace.
LEADERSHIP & TALENT MANAGEMENT
A report from DDI reveals that 49% of manager candidates lack effective conflict management skills, while only 12% excel in handling workplace conflicts. Only 30% of leaders feel confident in managing conflict, highlighting a significant area of weakness among new leaders that requires training. The rise in political tensions and employee distrust of leaders has led to more polarized workplaces, affecting productivity and morale. Specific skill gaps identified in conflict management include clarifying core issues, offering support and resources to teams, and empowering team members, all of which can be addressed through training and coaching.
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The debate surrounding the role of business in society, especially in relation to environmental, social, and governance (ESG) responsibilities, has intensified. This conversation has seen a notable backlash against ESG in the US, with polarized views on its relevance. Business leaders are increasingly challenged to navigate between extremes, such as focusing solely on shareholder value or attempting to meet every stakeholder concern, which underscores the need for a more balanced, practical approach. It is essential for companies to be realistic about which societal issues they can effectively address, concentrating on core business-related challenges and aligning their efforts with UN human rights frameworks to guide ethical commitments. Additionally, internal organizational alignment across areas like branding, culture, sustainability, risk, and ethics is crucial to fostering a cohesive and ethical corporate culture. Emphasizing transparency and accountability in political spending and activities further supports these efforts.
RECRUITING & RETENTION
Companies are increasing qualifications and experience minimums for open positions, with 59% expecting this trend to continue over the next year, not due to reduced hiring needs but to manage the influx of AI-generated resumes. The stricter requirements include mandating specific skills or technologies, more years of experience, industry-specific experience, and more, posing a challenge for job seekers in a competitive market. Despite 89% of leaders believing AI will make the hiring process more efficient, concerns arise that raising requirements might not necessarily filter out the best candidates and could complicate the search for suitable talent. The shift towards skills-based hiring is seen as an evolutionary step, aiming to find the best talent, although it presents additional obstacles for job seekers amidst a changing job landscape and increased competition.
Artificial Intelligence (AI) is projected to reach $942.3 million in the global recruitment market by 2030, with a 6.9% growth rate from 2020 to 2030, enabling companies to leverage AI tools for better talent insights and candidate screening based on competencies and skills. AI in recruitment processes helps reduce human bias by focusing on matching candidate qualifications with business objectives, promoting diversity, equity, and inclusion (DEI) goals. Utilizing AI speeds up the hiring process by automating tasks like candidate sourcing and resume screening, allowing recruiters to focus on strategic tasks, improving hiring accuracy, and meeting both business and candidate needs. AI technology can also aid in internal hiring practices, offering insights into the current talent pool, promoting employee retention, saving costs by automating tasks, and enabling businesses to prioritize internal hiring for long-term benefits.
LABOUR MARKET INSIGHTS
Competition for graduate positions has reached a peak in the UK, with an average of 140 applications per vacancy, as per new research by the Institute of Student Employers (ISE). Higher paying and emerging industries like digital/IT and financial/professional services saw the most demand, with 205 and 188 applications per vacancy respectively. Economic impacts from the pandemic, cost of living crisis, and energy crisis have led to unprecedented levels of competition for graduate roles, with a flood of new graduates and redundant workers entering the job market. Generative AI is playing a significant role in the hiring process, with 23% of companies restructuring their selection process due to AI and 21% already using AI in recruiting.
A study by Robert Half revealed that 29% of younger workers in the UK prioritize salary over job security, with Gen Z and millennials showing a strong focus on pay expectations. Gen Z employees are willing to leave their jobs if pay demands are not met and are also motivated by values-driven work, seeking employers aligned with their ethical values. There is a shift in priorities across generations, with Gen Z understanding the lack of job security and loyalty in today's market, leading to a willingness to change jobs for better conditions. Employers are advised to focus on strategies like equality, diversity, and inclusion initiatives to retain Gen Z talent, emphasizing the importance of fostering unity across generations in the workplace.
Millennials are at the forefront of demanding better work-life balance, with 57% actively participating, in contrast to 22% of Gen Z workers and 16% of Gen X employees. Employers can support work-life balance by implementing measures like meeting-free days and task-based work schedules, allowing employees to deliver their best work. The trend of 'coffee badging,' where employees spend time in the office before finishing work remotely, is growing, with 39% of workers practicing it, up from 23% in 2023. Despite the popularity of coffee badging, a significant number of employees indicate that their managers are indifferent to the practice, leading to 47% of respondents considering a job change for more flexibility if their employers abandon hybrid work setups.
A report from ABI Research revealed that 50% of the top 10 workforce challenges in manufacturing are people-related, focusing on concerns like recruiting quality staff, staff retention, and workforce skills improvement. Manufacturing decision-makers identified that a lack of skilled individuals hinders digitalization efforts, with staff training being a key investment area for improving productivity and quality. Cybersecurity concerns in manufacturing also involve people challenges, with worries about reputational damage, data loss, and staff safety as a result of breaches. Despite improvements in various areas, manufacturers are still struggling to fill labour gaps, and without changes to the talent experience, the industry could face a shortage of nearly 2 million workers in the near future.
Gartner predicts that the adoption of generative AI in enterprises will prompt a widespread upskilling effort among software engineers, with around 4 in 5 engineers needing to upskill by 2027. The emergence of generative AI will reshape existing workflows and job functions, creating a demand for a new type of professional known as the AI engineer. Despite the anticipated spike in engineers using AI-powered coding assistants by 2028, concerns remain about code quality, security, and the challenges posed by legacy technology and skill gaps. Executives highlight cybersecurity, AI, and data as top investment priorities for training in the AI-native era, emphasizing the importance of an 'AI-first' mindset for software engineers.
🔔Career Reflection - A Quick Guide to Navigating Job Offers from Competitors Smoothly and Ethically
When considering a job offer from a competitor, carefully evaluate potential risks and implications. Begin by reviewing any noncompete, non-solicitation, or confidentiality clauses in your current contract and assess any confidential information that could pose risks. Discuss these with the prospective employer to set clear boundaries. Consider a voluntary break in employment if proprietary knowledge is involved, and assess the potential impact on your professional network and reputation. Be transparent with your current employer, expressing appreciation and preparing talking points for a smooth transition. Finally, continue managing risks after joining the new company by upholding confidentiality and legal obligations.
QUOTE OF THE WEEK
"AI will change the world, but exactly how it changes is up to us. AI should augment human capabilities and be aligned with human values."- Fei-Fei Li, Professor at Stanford and co-director of the Stanford Human-Centered AI Institute, TED Talk, 2018
I help tech companies hire tech talent
1wGreat insights, Zabe. Any openings at SThree?