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Employers may finally be gaining some more confidence in the state of the talent market as new research shows that hiring doubt is subsiding.
According to ManpowerGroup Employment Outlook Survey Report Q3 2023, in the UK, employer confidence has grown in just about all sectors by 8 percentage points to 29 per cent since the previous quarter.
Manpower Group UK director Chris Gray said these trends are very positive considering the state of the economy.
“The intention to hire remains very positive for most businesses. Especially if you consider how this year began with concerns of a recession, and where we are in terms of inflation and the cost of living,” said Mr Gray.
“We should lean toward the opportunities this positive outlook indicates, as we’re still seeing concentration of demand in our real-time data for very specific skills across all sectors.”
This confidence in the talent market is still 5 per cent lower than this time last year, however. Furthermore, 80 per cent of employers have noted hardship in finding skilled talent, the highest rate in 17 years.
Employers are responding to these issues differently. The most common plan is to increase hiring, with 44 per cent doing so. Meanwhile, 15 per cent plan to decrease staff levels, and 38 per cent will keep their workforce the same.
Australia had one of the most positive outlooks on the future of employment, ranking fourth out of 41 countries at 37 per cent.
This data could spell the easing of talent shortages. A study by LinkedIn supports this idea, as hiring in Australia has decreased by 35 per cent between March 2022 and March 2023.
A major contributor to this decline in hiring is the rise of internal mobility. Some industries have seen dramatic increases in internal mobility rates, such as entertainment providers, which have risen by 28 per cent between February 2022 and February 2023. Administrative and support services trailed at 23 per cent, and professional services at 18 per cent.
LinkedIn’s chief economist, Karin Kimbrough, commented: “We see labour markets rebalancing further as the global economy slows. This means employers are reclaiming some bargaining power from their employees.
“But at the same time, labour markets remain relatively tight in many countries and industries when compared to their pre-pandemic baseline. That’s what makes this era so unique.”
She continued: “Our new internal mobility data insights are a bright spot — and a beacon into the future. As we learned in the last Global Talent Trends report, internal mobility increases employee retention. And despite the current hiring slowdown, everything I’m seeing indicates that a top business challenge moving forward revolves around people: finding the people who have the skills businesses need, keeping them, and upskilling them.”
Although the rate of employers taking advantage of internal mobility is high, employees have other plans. LinkedIn revealed that Aussie employees were 1.1 times more likely to leave their organisation over internal mobility.
Leaders were much more likely to consider internal mobility, as they’re 1.8 times more likely to do so. Gen Z was the least likely to take advantage of internal mobility. Millennials were most likely, followed by Baby Boomers and Gen X.
“All factors (like company culture and flexible work options) being equal, employees prioritise external job opportunities over internal moves for two reasons: those job openings are easier to find, and they often provide bigger pay bumps,” said LinkedIn’s vice-president of talent development, Linda Jingfang Cai.
“Even when employees do prioritise internal roles, they can get discouraged by internal-hiring processes that are often clunky, and it can be hard to demonstrate transferable skills. On top of that, their companies often won’t pay them the same as someone hired from outside.”
She concluded: “As it stands, our labour market values experience over skills. We even see evidence of that in the populations for whom internal mobility works well — people managers and Millennials, both of whom tend to have significant work experience. So as talent leaders, we have to evangelise the shift from valuing our people’s experience to valuing their skills. We need to make it easier to assess and demonstrate skills and adopt equitable compensation practices that are based on skills. That’s how we unlock the real potential of internal mobility.”
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The practice of actively seeking, locating, and employing people for a certain position or career in a corporation is known as recruitment.
Jack Campbell
Jack is the editor at HR Leader.
