In my last blog I looked at some of the key messages from the latest conference hosted by the Forum for In-House Recruitment Managers. The closing session looked at the results in their latest membership survey, always a good barometer of how companies are performing and which are the preferred routed to market.
This latest research shows healthy recruitment levels and a positive outlook for new opportunities being created this year. However when it comes to the how and the why of talent acquisition then there are certainly consistent themes indicating that this area is going through change, and some that show the function needs to respond quickly in some crucial areas.
Taking a closer look at the figures, here’s what I found…
Delegates at the event had crowdsourced their current recruiting priorities and issues and the survey pretty much underlines what they found. Building talent pipelines, up-skilling direct sourcing capabilities and building and communicating employer brand are the 3 main ones, with current systems and process review and candidate experience next. These are relatively consistent. Areas such as succession and selection processes and strategic workforce planning are much lower priority – maybe they are currently being done well, or the responsibility for them lies elsewhere, but in view of growing skill shortages and the changing nature of working arrangements it may be that these should be moving up the order.
Mention of skill shortages takes me on to the question of future talent, and how businesses train, develop and support them. 56% of respondents have a graduate programme and 44% an apprenticeship scheme in place. However 86% have no school leaver programme and only 38% have proper work experience schemes. Whilst the latter figure is slightly higher than last year I can’t help but feel that both add up to there being a large pool of potential that is not being catered for.
Whilst we’re on entry level candidates it’s worth looking at career sites as there is plenty of research in the market showing that these are an applicant’s first point of contact with a potential employer. The good news is that 92% have one (although it was 95% last year) – but from there on the picture is mixed. Only 23% rated their site as above average or excellent (a drop from 38% the year before) whilst 44% felt theirs was below average or poor.
The rating of below average/poor remains at around a third for visibility, accessibility and ease of application, rising to 46% for appearance. Perhaps the biggest surprises were that only 36% rated their site as mobile friendly and 30% as mobile optimised. When you consider that well over three quarters of job seekers will first access the site from a mobile device then this is a massive mixed opportunity to present a strong brand or compelling reason to apply.
Some sites have been launched fairly recently and others within the last 2 years. Half have been redesigned within the last 2 years…but sadly 5% have not added any new content to their career site for 4 years or more!
Routes to Market
Digital and social channels continue to dominate, with only 4% not using any job boards and 6% not using LinkedIn. For job boards there is an increase in the number used with 45% using between 3 and 5, 17% using between 6 and 9, whilst 15% use 10 or more different boards.
Whilst many may question whether LinkedIn is actually a social channel, for the purposes of this market it’s the main one – although usage of Twitter was up to 60% and Facebook 48%. On the question of effectiveness of these channels, an overwhelming 86% find LinkedIn number one, impressive when you consider that 35% of respondents only have a basic, free account. The most popular use of LI was for sourcing (40%) though job posting is now close behind. Only 23% seem to see it as a channel for branding purpose, which may be a missed opportunity.
As the popularity of social and digital channels for direct sourcing rise then something has to give and could that be recruitment agencies? Over the last 2 years the number of companies stating that agencies fill less than 10% of vacancies has risen from a third to just under a half, with 76% of all respondents now saying that agencies fill less than a quarter of their open vacancies.
One reason for this could be the rise of preferred supplier lists (now operated by over 80%) and whilst the rise in RPO is often cited as a factor, in this survey 77% said that they do not outsource any part of their recruitment process. Those that do use an RPO see flexibility, scalability and cost reduction as the reason – all indicating a shift in labour costs from fixed to variable, no doubt to cope with fluctuating hiring needs.
Small is Beautiful?
The final area that I looked at concerns the teams themselves, and the most striking stat was the increase in one person in-house recruitment teams from 9% to 15%. There has been a general downsizing of the recruitment function over the last 3 years, with teams of between 2 and 5 now comprising 29%, with teams of 10+ members down to 34%.
One reason for this could be downward pressure on budgets, even with the increase in hiring. Almost half of the respondents have a budget capped at £500,000 or less with only 29% having a budget in excess of £1m. The smallest budgets tend to be within FMCG, consulting and retail, whilst the largest in healthcare, energy and finance. The could also reflect a shift from permanent hiring to more flexible arrangements.
Whatever the arrangements both cost per hire and time to hire are moving in the required direction. Over half of respondents have a time to hire (from job creation to verbal offer acceptance) of less than 8 weeks, whilst two thirds have a cost per hire of less than £2,500. For both of these, though, there are sectoral differences…for instance with healthcare roles 58% reported a time to hire in excess of 12 weeks, and for manufacturing and engineering roles the cost per hire can be up to £4,000. Clearly the impact of skill matches, candidate availability and vacancy volume have a major impact in this area.
Certainly there is optimism amongst the community and signs of growth this year, which is good news.
From the survey results though there is an undercurrent of smaller teams and budgets, average career sites with little appreciation of the importance of mobile, and a growing reliance on LinkedIn against more traditional routes such as agencies. But the reality is more varied and complex, largely governed by company size, sector, volume and capability.
Certainly the concerns over career sites and mobile are valid given their high importance in the job seeking process, whilst the lack of structured programmes for school leavers and work experience raise questions over an untapped, and probably very willing, talent pool.
And whilst the time and cost of hires is being managed, we don’t get visibility of arguably the most important metric of all – quality of hire. As the market improves, and hiring volumes increase, then hopefully recruitment teams will have the capability and resources to deliver on that to high standards too. In particular it will be important for the smaller, or solo, teams to get the support and resources they need.