Last year, skills shortages had reached a record high, with 70 percent stating that skills shortages were making it hard for their organisation to keep up with the pace of change. This year that has dropped to 54 percent and shows that skills availability is still a major issue, although that has eased significantly over the last 12 months. Some of this is particular to the technology sector where, after a massive spike in demand for technology talent – solutions driven by the pandemic and the shift to remote working, along with wider digital transformation plans – conditions have finally begun to normalise. There is a softening in investment and headcount expectations, whereas a year ago, 52 percent of technology leaders expected their budget to increase, now this has dropped to 45 percent – while 50 percent expect headcount to rise compared to a much larger 58 percent in 2022. While these represent a fall, nevertheless they remain high by historical standards and the sector is still strong and prospects are healthy. But it isn’t just the technology sector where the skills availability/ shortage dynamic is moving, other industries are reporting that there are now more people available than there are jobs in some sectors, such as retail and hospitality. The same applies in crosssector disciplines like HR, although the market remains challenging, attraction and retention are still real issues and rising salary demands are unsustainable. It goes without saying that remuneration and reward must be competitive. The financial package remains the number one driver for most employees, but beyond that, I see five areas as key.

A compelling brand and employee proposition: It remains as important as ever to promote the employer brand in effective ways. It is essential to communicate well about the culture of the business, its values and purpose – especially as issues like the ESG agenda are critical factors for a growing number of people, in particular the younger generation. Articulating the employee value proposition in ways that are authentic and resonate with the talent pool is a key to success. Flexible working model: Another key factor that plays directly into both attraction and retention is the working model. Flexibility has become increasingly widely expected with most people looking for the ability to work remotely for a significant proportion of the time and it has become a fascinating area of evolving policy. There has been an increasing trend amongst employers – particularly large corporates – to mandate a number of days physically in the office. Indeed, the Digital Leadership Report finds that for the technology sector, this is most commonly two-to-three days. At the large employer end, it is more likely to be three days or upwards, while for medium and small firms it is more likely to be two. However, there is a significant degree of variation – overall, 12 percent of businesses have a mandate for just one day in the office, while 15 percent require either four or five. Clearly, what works best will be very individualised for each and every business and every employer should consider carefully what their policy is, listening to what staff are saying. It is generally accepted that flexibility around working patterns is good for the diversity agenda – in particular around gender – as parenting and caring responsibilities still tend to fall mainly on women and flexibility enables them to better balance these demands and maintain a career. However, it isn’t just about gender, as men are increasingly contributing to parenting and caring. My own view is that two-or-three days in the office is probably optimal and this approach helps to create clarity for everyone. It supports collaboration and team-working and means that many of those day-to-day decisions can be taken much more quickly, as people discuss matters and bounce things off each other in the flow of work.

Talent sourcing: Another key aspect is the sourcing of talent and the sourcing model remains an issue of some debate in the HR industry – to what extent to build and run an in-house recruitment team and how much to rely upon external third-party specialists, or perhaps consider a hybrid model. In the technology industry, many internal recruitment teams have been downsized in recent months as recruitment plans have been reduced. Whatever the model adopted, I personally believe that retaining at least some specialist third-party services is advisable – in-house teams can’t be expected to know the nuances of every market and some roles – finance, IT and legal, as examples – need a specialist to source and identify the best candidates. Building diverse talent streams: Then there are the talent pools and communities to reach out to and target. Building higher rates of diversity is also a way of increasing access to talent and has become a priority for most businesses – and HR teams have a formative role to play in shaping the approach. Whether it’s creating links with a wider range of community groups, forming connections with schools and colleges, or creating apprenticeships, internships and work experience programmes, think about the audience that you are trying to reach and what will resonate with them. Often, the focus is very much on young talent and that’s absolutely understandable, but don’t forget apprenticeships and reskilling programmes apply just as much to mature talent too. Targeting career switchers and workplace returners can be an effective way of sourcing experienced talent and also boosting diversity. Don’t forget also that it’s the leaders and managers who will deliver the diversity strategy, so equip them for the task. Leading and managing more diverse teams is likely to require new skills and levels of awareness, so make sure that there is sufficient training and support for managers, so that they are equipped to bring the strategy to life. Invest also in L&D and resources for all staff, such as diversity awareness training. An inclusion strategy needs to do just that, include everyone, whatever their role. See the potential: Finally, in what remains a difficult market – be flexible in the requirements. Instead of demanding a 100 percent fit against the experience and capability wish list, consider those who may be an 80 percent match, but have all the potential to grow into the role in the future with the right training, development and support.

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