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To stay competitive in today’s ever-changing business environment, C-level executives agree that finding and retaining the right talent for their blended workforces is essential. But how to do that effectively remains a challenge. According to a joint research study by Dow Jones and the HR Certification Institute, the area of talent strategy and engagement is a top concern. Surveyed C-suite executives ranked it among the top five items on the corporate agenda, yet only 59 percent consider their companies to be effective at attracting and retaining talent.
“Many of the forward thinking companies are now turning their focus on making workforce strategies a clear priority for 2018 as they respond to both ongoing and emerging trends,” says Bill Hyman, chief human resources officer for CDI. “The hiring of both full-time and contract employees is being impacted by a number of significant trends that will only intensify over time.”
As the job landscape changes, more companies are creating blended workforces that incorporate contract or part-time employees into the traditional nine-to-five arrangement. According to a report by The McKinsey Global Institute, about 20 percent of the working-age population is engaged in some form of independent work, most by choice. Online and human cloud platforms have additionally expanded the potential of the gig economy, with gig workers expected to grow from about 4 million today to 7.7 million by 2020, according to a recent study conducted by Intuit and Emergent Research. “Companies in candidate-driven industries require access to highly-skilled contingent talent, and they continue to look to traditional search and recruitment firms to find that talent,” observes John Lewis, director of sales operations for CDI. “Firms that have existing relationships with top candidates and the ability to act as a single source solution provider have the resources to deliver the most qualified performers in their markets, on a permanent or contract basis.”
As more technology becomes available, companies are using predictive analytics to determine how candidates will perform. Google, for example, has been using analytics to gain insights into the impact of every interview and source of hire since 2015, according to Deloitte’s 2015 Human Capital Trends Report. Many in the human resources arena predict that the rising use of predictive analytics will be the biggest recruiting trend to drive productivity and profitability in 2018. By collecting early performance data on new hires and contract workers, and matching it against assessments, a feedback loop is created that automatically updates and continually refines the profile of a successful employee.
Bias in the workforce became a big issue in 2017. To minimize any controversy, companies are being encouraged to make hiring a blind process. In standard screening and interviewing, unconscious bias easily becomes part of the equation by including data that gives away key parts of a candidate’s background: gender, age, race, even alma mater. By stripping away any information that may reveal demographic data, the first wave of screening can be done based purely on abilities and achievements. “One of the most effective ways to institute a reliably blind process is to focus on the job candidate’s skills which an outside recruiter can save to create a pipeline of diverse and qualified candidates,” says Bill Hyman.
Gamification, a technique for turning engagement into a competitive game, is beginning to be used as a candidate screener. Tools such as ConnectCubed claim that games add to the attractiveness of the application process while delivering actionable insights into candidates’ fit for permanent or contingent roles. Although not yet in widespread use for recruitment, according to the Society for Human Resource Management (SHRM), many companies are finding that virtual games, which integrate points, badges, competition and role-playing, can be used to effectively attract and assess candidates, particularly Millennials raised on Wii and Xbox. The results can be used by recruiters to identify the most promising candidates in their pipeline as under-the-hood algorithms track critical analytics while candidates play the games.
“Gamification adds an element of competitive fun for candidates and at the same time gives potential employers access to valuable, actionable data to predict candidate fit and future performance,” says Eric Jaquith, director of national recruiting operations for CDI. “Recruiters are increasingly called upon to use their experience and their acquired intuition to make sense of the data. They can then offer meaningful recommendations, saving their clients time and helping them to determine which candidates are more suited for contract rather than permanent work arrangements.”
Preparing Employees for Future Change
Evolving technology is responsible for both the disappearance of many jobs across a wide range of industries and the creation of other jobs where skilled labor is needed; for example, when robots or automation techniques are introduced, companies still need technical talent to program, maintain and repair these robots. “More than ever, companies have to consider how they will do business in the future and figure out how to leverage their people, systems and tools to meet their upcoming needs,” advises Hyman. “Identifying people who have the ability to tackle different aspects of jobs that require a human element will help in determining how they can be best aligned with a company’s growth strategies. Depending on the industry, this could represent a significant transformation in overall human capital strategy, in terms of what different employees are tasked with, and how they fit into a blended workforce. According to a Harvard Business Review article, Why People Really Quit Their Jobs, most companies design jobs and then slot people into them. The source added that the best managers sometimes do the opposite: When they find talented people, they’re open to create jobs around them.
“Today’s employees expect to have the kind of experience in the workplace that they have as consumers,” says Hyman. “They seek skill development opportunities that are immediate and individualized — a YouTube or a Google approach, where they can get quick, simple, targeted solutions is what they really want.
The ongoing, tight labor market means that companies will continue to be challenged with finding and retaining the right employees. “Workforce strategies are increasingly being prioritized among leadership teams,” concludes Hyman. “There is a burning need to implement blended workforce plans that will increase the quality of new hires, while retaining the organization’s top talent.”
Recent CDI Analysis
“There is a burning need to implement blended workforce plans that will increase the quality of new hires, while retaining the organization’s top talent.”Bill Hyman
Chief Human Resources Officer
Employment Situation (U.S.)
With the first month of a new year in the books, the Bureau of Labor Statistics released its first Employment Situation Summary of 2018, and found that the pattern of fairly robust job growth and low unemployment seen in the booming economy of last year continued.
Nonfarm payroll businesses across all sectors added 200,000 jobs in January 2018, a significant uptick from the approximately 160,000 new positions created in December 2017 (revised upward from the BLS’s initial tally of 148,000 jobs). Unemployment remained static at its record low of 4.1 percent for the fourth month in a row. Leading economic experts surveyed by Bloomberg had expected a slightly more modest median figure of 180,000 new positions during the month.
Average hourly earnings across the nonfarm private sector increased 9 cents, a minor downturn from the previous month’s 11-cent gain, but year-over-year wage growth from January 2017 to 2018 is a strong 2.9 percent. Also, in the last three months of 2017, wages and salaries shot up 2.8 percent. Minimum-wage increase laws coming into effect in more than a dozen states should serve to further boost workers’ earnings.
Michael Feroli, the chief U.S. economist for JPMorgan Chase & Company, elaborated on the good signs projected by the latest employment numbers, including wage growth.
"The gain in wages will add to concerns that inflationary pressures are building in the economy," Feroli told Bloomberg. "It solidifies expectations that the [Federal Reserve] will hike [interest rates] in March. The question is, what will they signal for hikes after that?"
The answer to Feroli’s query remains to be seen, as no signals have emerged to indicate federal benchmark interest rates being raised beyond the widely predicted March 2018 hike. That said, this small uncertainty is unlikely to sour business owners’ positive perceptions of the U.S. economy.
The slowdown in job growth from November 2017, which saw the creation of 216,000 jobs (revised down from initial estimates of 252,000), to December of last year raised some concern about U.S. employment strength regressing somewhat toward the mean. January 2018’s numbers could well assuage any such worries, however. Nearly all of the industries that served as primary engines of expansion for the American workforce last year, such as healthcare, manufacturing, construction, and food and beverage services all added jobs during this month. Major sectors including mining, information, financial activities, professional and business services and government assessed didn’t grow or contract in any statistically significant ways over the month. Construction exceeded all other industries in terms of new positions created, with 36,000 of them added in January 2018. Rounding out the biggest employment upticks were durable goods and general manufacturing, which added 18,000 and15,000 jobs respectively.
According to The New York Times, the recent tax reform legislation passed by Congress and signed into law by President Donald Trump has galvanized the American business community’s outlook for the immediate future, prompting some companies to issue bonuses or raise wages. The long-term impact of the new tax rates is not yet known, and nonpartisan economists continue to express concerns about the law’s ability to pay for itself. Nevertheless, January’s numbers bode well for the progress of the U.S. economy.
The full Bureau of Labor Statistics report can be downloaded by
Employment Situation (Canada)
In recent months, particularly November and December 2017, Canada experienced massive surges in employment. These upticks had workers, employers and government officials in high spirits, and may have created expectations of impending success for the new year. Yet the latest Labour Force Survey from Statistics Canada, showed a reversal of considerable magnitude.
The Canadian workforce saw 137,000 part-time jobs lost, and despite the addition of 49,000 full-time jobs, this made for a net loss of 88,000 positions. CBC News noted that this was the largest decline in employment from one month to another seen since 2009. Economists surveyed by Bloomberg had predicted a gain of 10,000, in stark contrast to the survey’s results.
If this contraction comes off as a shock to economists or employers, that sentiment is likely attributable to how significant the gains were last November and December. The former saw 88,000 new jobs created, while the latter had a 79,000 increase, both of which significantly outpaced estimates among economic experts, who expected 10,000 and 1,000 jobs added, respectively, during those periods.
Meanwhile, although its negative move wasn’t as significant as the jobs numbers, Canada’s unemployment rate also rose to 5.9 per cent. This represents an uptick of 0.1 per cent from the adjusted December 2017 figure of 5.8 per cent.
The biggest sector-based decline in the Canadian labour pool came from the field of educational services, which experienced a loss of 20,000 positions. Finance, insurance and real estate saw a drop nearly as large, shedding 18,000 jobs. Professional, scientific and technical services; construction; and healthcare also saw five-figure job declines, losing 17,000, 15,000 and 11,000 positions, respectively. In fact, the only Canadian sector to see any notable growth was what Statistics Canada classifies as "business, building and other support services," which gained 11,000 employees. On a year-over-year basis, however, none of these fields saw much positive or negative change, slightly offsetting the monthly declines.
According to Bloomberg, these findings are more in sync with broader trends in the Canadian economy. While the nation remains in good shape overall due to low unemployment, it makes sense that the labour market would eventually tighten after such considerable expansion. Also, since the second half of 2017 began, its pace of growth across most economic metrics except job numbers had begun to slow.
Avery Shenfield, chief economist for the Canadian Imperial Bank of Commerce, tried to take an optimistic view of the latest job numbers in a note distributed to the bank’s major investors and obtained by Bloomberg.
"A mysterious mix of good and bad," Shenfield’s note read, "with the latter’s impact blunted by how strong job gains were in the lead-up to these figures."
There exists a strong chance that the Labour Force Survey will influence more conservative attitudes in Canada’s national bank, particularly regarding interest-rate hikes. Doug Porter, chief economist at BMO Financial Group, elaborated on this.
"Even prior to this week’s financial market gyrations and this weak jobs data, we were of the view that the [Bank of Canada] would wait until the second half of the year before hiking [rates] again," Porter stated, according to CBC. "These developments only embolden that view."
Despite the negatives detailed above, a number of other indicators of the Canadian economy’s overall status were positive. Annual wages grew 3.3 per cent, which constituted an improvement over the 2.7 per cent growth seen in December 2017, and the nation’s currency shot up in value to hit C$1.2595 per U.S. dollar.
Canadian ES Report:
Labour Force Survey, January 2018