The second year: HR shares insights on adapting as the pandemic and labor shortages continue
On the whole, companies are in better shape today than at this time in 2020.
A new survey of HR professionals confirms that the job market remains “brutal” for companies, with 74% of respondents saying that they are struggling to hire qualified talent.
The report is from GoCo, an HR software firm, which surveyed more than 600 HR professionals, asking them how the pandemic is affecting them after more than a year, and what their plans are moving forward.
The results paint a picture of companies scrambling to address large numbers of resignations, a need for remote work options, and a demanding job market that requires adjustments on many levels.
“HR is under tremendous pressure to fill job positions in one of the most brutal job markets of our time,” said Nir Leibovich, CEO of GoCo. “It will be critical for companies to listen to HR professionals and leaders about what is working and not working in talent acquisition right now. This survey reveals some critical insights into how companies can retain top talent and bring in new people despite the current challenges.”
A brighter economic situation—but new challenges emerge
On the whole, the survey finds that companies are in better shape today than at this time in 2020. During the pandemic’s early months, GoCo’s surveys found that 45% of companies were making budget cuts in response to COVID-19; but this year, only 18% report doing so. In 2020, 45% of companies froze hiring, today only 11% are doing so.
The study also noted that unemployment rates have dropped significantly since 2020. “This is a good sign that companies who had previously held hiring freezes or furloughed workers are now able to support more positions as they continue to rebuild and regrow,” the report said.
On the other hand, American workers are reconsidering their work life on a massive scale, the study found, noting that the “great resignation” continues.
Some of the findings of the survey underscore the labor crunch:
- 57% of HR professionals say voluntary resignations are higher than previous years, with only 15% saying they are lower.
- Sales and customer service are seeing the highest resignation rates, at 35% and 31%, respectively.
- 52% of resignations are by entry-level employees and another 37% for midlevel (non-management) employees.
- 74% of HR professionals say they feel more pressure from leadership when it comes to hiring and retention, but that drops to 64% at companies that are increasing wages, offering benefits and retention bonuses, or expanding engagement programs.
Adjustments for a changing labor market
The report also confirms that the move to remote work, which has become commonplace during the pandemic, is going relatively smoothly. For example, 85% of respondents in the new survey said that remote work had a positive or neutral effect on productivity. The same percentage said remote work had a positive or neutral effect on their company’s ability to meet key business goals.
On the other hand, concerns remain about the long-term effect on workplace culture. The survey found that 76% of respondents said remote work had a neutral or negative effect on collaboration between teams and departments, while 37% said remote work had a negative impact on mental health.
The report suggested that companies will continue to assess the pros and cons of remote work going forward. The data also suggested that worker expectations are also in flux—and that many companies are taking steps to address those expectations.
When GoCo asked HR professionals what their companies are doing to attract and retain workers, they found a range of strategies:
- 60% are increasing wages
- 59% are adding benefits or perks
- 40% are offering retention bonuses
- 31% are expanding culture/engagement initiatives
- Only 7% are doing nothing
“There will be distinct winners and losers in this war for talent and the companies that support the recommendations of their HR professionals and leaders will be the companies that grow and thrive,” Leibovich said.
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