The “war for talent” is a term originally coined by McKinsey and Co in 1997 referring to an increasingly competitive landscape for recruiting and retaining talented employees.

As many will be aware, the war for talent is well and truly over and the talent has won!  More recently, there has been real evidence across the world of “The Great Resignation” aka “The Big Quit”, as increasing numbers of people resign largely in response to the COVID-19 pandemic.  At the centre of this is people rethinking their careers, working conditions and long-term career goals.  Top of mind is an increasing importance on working from home and work/life balance.

While it is widely reported that this is mainly seen with the Millennial and Gen Z populations, it certainly is reported across a wide range of roles and generations.  Alarmingly, US studies report that over 50% of Gen-Z employees are planning to seek a new job in the coming year. 

So, what relevance does this have locally?

In December 2021, Newshub reported that “while there isn’t enough firm data to confirm this is happening in New Zealand yet, there is little doubt a chronic skills shortage has given workers more bargaining power.  Perhaps not surprisingly, research shows more and more workers are at least thinking about either changing or quitting their jobs since last year.”   

While we acknowledge the above influences, we are certainly starting to experience a talent drought in executive appointments.  At Sheffield we focus on appointing Non-Executive Directors, Chief Executives and C-Suite Executives.  Although there are a number of roles we may never advertise, and solely rely on search approaches as the most effective way to identify and approach candidates, we have seen a significant increase in the number of roles requiring search to complement our national database and advertising.  The significance here is these are positions that would normally not require a search process.  Search as a method, has moved from less than 50% to close to 90% of all roles we are recruiting for.  This is a significant shift. 

Further, if we look at candidates we have placed, more than 50% over the last six months have been sourced through direct search and approach, having not seen or responded to an advertised vacancy. 

Are the days of placing an advertisement via online media channels and hoping for an outcome close to an end, as candidate responses slow dramatically? 

So, what does all this mean? 

Firstly, top candidates are generally actively involved and engaged in their jobs and not spending time looking at potential vacancies.  Secondly, the candidate pool we are seeing post COVID has definitely shrunk.  Search and direct approaches definitely work for compelling opportunities, and this is an approach we highly recommend.

The flipside is, this means the time to hire and conclude an assignment from initial client brief through to offer is increasingly under pressure.

Candidates are in the driving seat.  More often than not we are now discussing the need for flexible working conditions, (specifically working from home, work/life balance), increased annual leave and any other benefits that might be available.  We predict this is a trend that will continue over the coming months and years. 

I would be interested in whether others are seeing a similar shift in the market, so please pick up the phone and give me a call, I’d love to hear your thoughts.

 

Mike Stenhouse is the Executive Director of Sheffield South Island and has extensive experience working on Chief Executive Reviews, Board Appointments, Board Effectiveness Reviews, Executive Search and Selection and Organisational Development projects.

He has undertaken numerous Director, CEO and Senior Executive selection projects including the appointment of Chief Executives to a wide range of organisations.

Mike works across industry sectors including local government, finance, agriculture, not-for-profit, education, manufacturing and export.

Mike can be reached at Sheffield via this link.

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