In a single daily news roundup at the end of October, I read four news articles I found shocking.
First, the Times reported a 49% decrease in the number of apprenticeships offered by UK SMEs since 2017. In large organisations there had been a 14% decrease in the same period.
Then, Bloomberg reported the number of jobs in the UK financial services sector is now in sharp decline. This is due to a post-pandemic hiring frenzy that had left many organisations overstaffed.
Next, I read a Daily Telegraph report on a 30% fall in the number of graduate roles being advertised, based on data published by job search engine Adzuna.
Finally, a Guardian article documented the number of over-65s still working, positioning retirement as an increasingly luxury item affordable only by the upper classes.
What the hell is going on with the UK labour market?
These trends aren’t necessarily unique to the United Kingdom, however. Every developed country faces similar realities.
For me, what these data reveal is that recruitment and retention have become increasingly transactional.
Far too few of today’s organisations take their role as employer seriously. The continuous prioritisation of profits over people is fuelling widespread stress, anxiety and burnout. UK engagement figures are amongst the lowest in the world and an ongoing obsession with cost control has trumped any duty of care for staff that may have once existed in days gone by.
HR and recruitment functions don’t help. They know who their paymaster is and are increasingly acquiescent in this slow-motion disaster film.
How we recruit and retain people is very broken.
Why is recruitment broken?
There are myriad reasons why organisations fail to successfully hire and retain the people they need for stability and growth. Way more than I can write about here. But here are five front-of-mind reasons.
1] Digital transformation
The mainstream recruitment processes in use today were designed more than twenty-five years ago. After the dot.com crash at the end of the 1990s, the trend for business process re-engineering was fuelled by efforts to control cost and improve efficiency.
Recruitment was considered a prime area for business process improvement and cost efficiency. Alexander Mann Solutions was notably the pioneer in recruitment process outsourcing but other recruitment firms quickly followed. This has led to the vast range of RPOs and managed service providers we see in the market today.
An issue with business processes however is that once they’re proven to work, they tend to remain long past the point at which they are contextually relevant. In the case of recruitment processes, little has been done to review and improve them at scale, despite wholesale changes in the shape and nature of the labour market since the 2008 financial crash.
Digital transformation has also poured accelerant on ill-performing processes. Rather than review and improve the underlying flawed processes, technology companies have instead taken them and digitised them.
We’re told algorithmic CV matching will augment the hiring process to deliver faster, more cost-effective results. But outcomes are questionable. Algorithms can only match words contained within CVs to words contained within job descriptions and as job taxonomies are in continuous evolution, they only work so far.
In the first instance it’s increasingly challenging to encapsulate all the nuance of a career’s worth of experience into a 2–3-page CV. Without context, it’s almost impossible to discern the full extent of a job seekers’ experience.
Additionally, by myopically focusing on process, the software developers responsible for designing these digital interfaces have tragically overlooked the crucial fact that recruitment and retention are fundamentally relationship and people-centric activities.
Not only do many of these digitized recruitment interfaces lack regard for the modern candidate’s job-hunting experience, but they are also rarely updated. That would be complicated and time-consuming. As the saying goes, if it’s not broken, don’t fix it.
Over-reliance on ‘automated’ job application systems has sadly stripped the job application process of any human interaction. It’s a tragic reality that most jobseekers now struggle with the inhumane regularity of having to digitally apply for roles without any human contact whatsoever.
Over the past few years, I’ve heard so many stories of jobseekers reaching the final interview stage and then never hearing anything further from the hiring organisation. And we wonder why ghosting has become mainstream in recruitment.
2] Lack of understanding of the current labour market
Today’s labour market is completely different to the one for which mainstream recruitment processes were originally designed. Most processes still in play today cater for a market that comprises permanent and temporary staff. They don’t accommodate the realities of a labour market that consists of multiple different employment types.
2021 research by Deloitte and MIT SMR highlighted the extent to which most organisations now depend on “the Alternative Workforce” for the delivery of business outcomes. Yet too few HR professionals and recruiters understand these new labour market ecosystems well enough to adapt accordingly.
In tandem, the UK labour market is slowly shrinking. As the population ages and birthrates fall, fewer people are entering the labour market than are leaving it.
We need a wholesale reimagination of how we recruit, motivate, engage, retain and re-engage the full spectrum of talent available, regardless of employment type. Like it or not, we must bake in flexibility to employment frameworks to allow work to fit in with other life demands, while maintaining delivery against an organisation’s vision.
Too few recruiters today invest in the vital long-term relationship building that underscores the successful deployment of those crucial flexible and on-demand workers. It’s this contingent of a talent ecosystem that will optimise organisational agility and maximise market responsiveness.
This lack of focus on relationship significantly hinders recruitment outcomes. Only when the full-spectrum employment lifecycle is integrated into recruitment processes will hiring outcomes improve.
3] Focus on the wrong metrics
In the quest for efficiency, key measures of recruitment success are typically cost-per-hire and time-per-hire. Over the course of the last few decades, recruitment services have sadly all-too-often become perceived as a cost to be controlled rather than a value to be added. I even once heard of one well- known blue-chip promoting an HR executive to director level because they had successfully reduced the average cost-per-hire down to £800. I suspect this isn’t an isolated incident.
But when we prioritise these metrics, what happens to the job seekers’ experience?
For me, the less an organisation is willing to pay for recruitment services, the less I perceive it to value what an experienced recruiter can bring to a hiring process. In a bid to control cost, many employers have turned to less-experienced recruiters who are perfectly able to follow a process but who invariably have less industry and labour market knowledge. Value-add has been stripped out.
This lack of knowledge inevitably undermines confidence. The result is that all too often, lower-cost recruiters are less willing to speak to candidates to provide a rounded quality of service. They’re less equipped to educate hiring managers on labour market complexities or provide helpful context to set realistic expectations around job profile and skills mix availability.
4] Insufficient focus on candidate experience
Today’s jobseekers are shrewd. They’re also more brand and purpose conscious than even a decade ago.
Expect jobseekers to have done their research on your organisation and its key executives before applying. Compensation and benefits are no longer the only draw. Modern jobseekers want evidence of access to developmental opportunity, to know organisations are being led with authenticity and integrity and that future employers are acting ethically and responsibly.
Where feasible, modern jobseekers want the autonomy to choose how and when they deliver their work and to be trusted to do so. They also want to work in places where a sense of belonging and community are manifest.
The newest to the labour market – Gen Z – is proving the most elusive for employers today. What motivates these digital natives? Generation Instagram has entirely different expectations of work and life and organisations need to devise new approaches to attract and retain them.
But regardless of socio-cultural difference, ALL job seekers want a recruitment experience that is courteous and respectful. Digital recruitment processes are transactional and void of human touch. This needs to change.
5] Hiring for attitude
We’re still using conventional thinking about skills, and we’re hiring for hard skills rather than attitude.
The trouble is the pace of technology evolution and scale of complex global problems have already outstripped the pace at which we can reskill to handle them. Hard skills are easier to learn than the mindsets we need at work to successfully navigate continuous change.
In equal measure, most hiring process are full of assumption, bias and outright prejudice. We prefer this school or university over that, this gender over that, this age cohort over that. How astonishingly short-sighted.
Further, a CV can only tell us so much. It’s a starting point and invitation to get curious and explore. In shrinking labour markets, allowing an (inadequate) algorithmic matching process to reject a CV is incredibly myopic. Recruiters need to spend their days chatting to jobseekers for potentiality, not relying on software to have all the answers. When lack of career development opportunity is the second reason why people leave jobs, isn’t it such a wasted opportunity not to explore jobseekers’ potential for growth?
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Until we upgrade how we recruit, organisations are unlikely to get back on track and sustain themselves.
There are plentiful, inexpensive ways to improve recruitment processes. With previous experience of setting up centralised recruitment functions for both Three in Sweden and Orange in Switzerland, Cathryn now leads the Working the Future team to help organisations redesign their recruitment processes and improve hiring outcomes.
Please check out some of the services we’re providing and get in touch today for a no-obligation exploration of how we can help.