News & Views
CONTRACTORS FAVOURED OVER PERMANENT HIRE IN POST-GFC ERA OF RECRUITMENT
The attitudes of candidates and employers have taken a divergent path following the GFC, and that there are "misconceptions" on both sides of the employment equation. The end result is dissatisfaction from both sides, according to George Brooks, CEO, OCG Consulting Group
"On one hand we have candidates who are hoping to go out into the market and make a change - they don't care what sort of change, they just want a change. We've seen that from people who've sat through the GFC with their employer, they perceive their career is stalling and as soon as an opportunity comes along they are highly motivated to move-often without considering if it’s the right move for them.”
They also think they can take this opportunity to change industry sectors. That's not going to be the case," he said.
Brooks added that all employees had to go the extra mile beyond what they considered to be 'normal' during the GFC. "There was no industry that I'm aware of that didn't have that scenario. There are less people doing more work so it's all about productivity and return on investment at the moment," he said.
In addition, Brooks warned that skills development had taken a backseat during the GFC, and many candidates were unprepared for the burden that new roles in new organisations would bring. "People are coming with 2008 skill levels into the 2010 workplace and they're not as competitive – as personal development has not been a focus in the GFC”
On the employer's side Brooks said there was a misguided belief that the relatively high unemployment rate (6.0% for the March Quarter) equated to more and better people looking for jobs and therefore more candidates to choose from. "I'll get a better quality of candidates because there is more to choose from” - that's the belief," Brooks said. "Far from there being a greater selection of better people in the market we are now seeing skills shortages in some areas."
Brooks added that some employers also have an unreasonable expectation of ROI from new hires. "During the downturn there was immense labour cut out of most organisations. They're now recovering and making a profit. They're happy with that. But they're being cautious about re-hiring so they're sticking with contract workers.
At the moment that's impacting on two things: at the upper end of the market for mature contractors employers may have to pay more but get the experience so the work gets done; and at the entrance level where people perhaps have the technical or academic skills but don't have work experience."
Brooks said that the trend of contractors being favoured over permanent hires will likely continue "until that skill base is exhausted", and added that most leadership teams are looking to put themselves in a position of minimal risk. "The world has changed - the labour market in the mid to long term will have a more significant element of contracted employees so employers can turn off and turn on their labour requirements based on demand," he said.
Brooks urged employers not to forget talent currently residing in the organisation, to provide career pathways and career development. "Many employers have taken the foolish attitude of thinking, 'employees have been with me during the downside, they'll stay during the upside'. That isn't happening. People are disgruntled."
To start to bridge the gap between what employers are looking for from candidates, and vice-versa, Brooks said both parties need to be clear on their value proposition. "For a candidate this concept of candidate value proposition is commonplace - they must understand what their strengths and weaknesses are, and where they can add value to an employer. Then they must do as best they can to match these up to vacancies in the market. Similarly employers must be realistic about what their value proposition is to a new employee - whatever it was prior to the GFC it has probably changed."