Responding to reports from the Office for National Statistics (ONS) which revealed a 6% increase in average total pay – including bonuses – between June and August this year, the UK's leading independent provider of resourcing transformation and outsourced recruitment services, Omni RMS, has warned that financial incentives are not a long-term solution to the UK’s skills challenges.
Louise Shaw, Managing Director of Omni RMS, said, “While the ONS has reported a decline in vacancy numbers in September, these levels remain higher than pre-pandemic jobs, which suggests that competition for top talent is still rampant across the country.
“When recruitment gets tough, it’s easy to look at the financial incentives that can be offered to attract top talent. But on a longer-term basis and with general costs rising across the UK, this isn’t sustainable for all businesses.
“There will certainly be a need for pay rises as the cost-of-living crisis worsens, but for employers and HR teams there’s a range of other tactics that can be implemented to attract and retain top talent. In fact, in our own research with the CIPD we found that 30% of employers who had recruited in the past 12 months indicated that advertising roles as ‘open to flexible working’ is among their most effective recruitment method.
“More than half (54%) of organisations who have had recruitment difficulties are offering greater work flexibility to address this, while a further 49% say their use of hybrid/remote working has greatly or somewhat increased amid hiring struggles.
“There is a constant battle for top talent, and it’s important that businesses assess what they can realistically offer candidates and what they can improve upon to retain existing employees. Unrealistic salary inflation is not only unsustainable for employers but will also have limited success long term, with retention rates likely to drop as financially-driven individuals jump ship to gain further pay increases.”
Jen Gaster, Founder and MD of HR Heads, added, “Across the HR recruitment space, we are encouraging hiring organisations to really emphasise the work culture, progression opportunities and to be clear on what their flexible and hybrid policies look like.
“The challenge for Talent Acquisition specialists will be the pace at which the UK’s economic situation changes and we have been huge advocates for businesses moving quickly when they find someone suitable for their vacancy.
“The best HR talent is in higher demand than I can remember in my recruitment career, a protracted and misaligned hiring process will massively impact your chances of securing the top candidates.”