The Ongoing Impact of the Recession—Global Competition and Hiring Strategies

SHRM Survey Findings: The Ongoing Impact of the Recession—Global Competition and Hiring Strategies

March 12, 2013

The Ongoing Impact of the Recession—Global Competition and Hiring Strategies ©SHRM 2013 2

• This is Part 3 a series of SHRM survey results about the ongoing impact of the U.S. and global recession, which began in 2007. Overall results will be reported separately in three different topic areas:

Overall financial health and hiring. Recruiting and skill gaps. Global competition and hiring strategies.

• Overall results for 2012 will also be reported separately for California.

• Industry-specific results will be reported separately for each of the eight industries that were included in the sample:

Construction, oil, mining and gas. Federal government. Finance. Health. High-tech. Manufacturing. Professional services. State and local government.

Introduction


• Is recruiting for select jobs difficult in the current labor market? Two-thirds (66%) of organizations that are currently hiring full-time staff indicated that they are having a difficult time recruiting for specific job openings, an increase from 52% in 2011.

• Why are organizations experiencing difficulty hiring qualified candidates? Lack of relevant qualifications and competition for talent are the top reasons it is difficult to hire qualified full-time employees, according to HR professionals.

Nearly one-half (48%) of organizations indicated that candidates do not have the right skills for the job and 40% said candidates do not have the right work experience.

About one-third (35%) reported that qualified candidates are not within their organization’s salary range or hourly range rate, and 35% cited competition from other employers as a reason for difficulty in hiring.

Key Findings


• What strategies is your organization using to deal with recruiting challenges for full-time regular positions?

The most common strategies are related to recruiting new employees: expanding advertising efforts (47%), using social media to find passive job seekers (44%), collaborating with education institutions (37%) and expanding the search region (36%).

These are followed by strategies that focus on using current employees: training existing employees to take on the hard-to-fill positions (33%) and increasing retention efforts (32%).

Other strategies include providing additional compensation, benefits and training to attract new employees.

• Are organizations facing global competition for applicants for hard-to-fill jobs? Thirteen percent of organizations believe they are facing global competition for qualified applicants for jobs they are having difficulty filling, a decrease from 23% reported in 2011.

Larger organizations (2,500 or more employees) are more likely to report global competition than smaller organizations (1-499 employees).

Organizations in the high-tech industry is more likely than those in the finance, health, manufacturing, professional services and state or local government industries to believe that they are facing global competition for hard-to-fill jobs.

Key Findings


• Have organizations been hiring workers from outside the U.S. for jobs that have been difficult to fill? About one-quarter (24%) of organizations have hired workers from outside the U.S., the same percentage as in 2011.

Larger organizations (500 or more employees) are more likely than smaller organizations (1-499 employees) to have hired workers from outside the U.S.

The high-tech industry is more likely than other industries to have hired workers from outside the U.S. in an attempt to recruit for hard-to-fill jobs.

• Have organizations been hiring U.S. veterans for jobs that have been difficult to fill? Over one-half (58%) of organizations reported hiring U.S. veterans, an increase from 39% in 2011. Sixteen percent are either considering or have plans to hire veterans in the next 12 months.

Larger organizations (2,500 or more employees) are more likely than smaller organizations (1-2,499 employees) to have hired U.S. veterans in an attempt to recruit for hard-to-fill jobs.

The federal government is more likely than the finance, health, high-tech, manufacturing and professional services industries to have hired U.S. veterans in an attempt to recruit for hard-to-fill jobs.

Key Findings


What do these findings mean for the HR profession?

• HR professionals must prepare for a more difficult recruiting environment as the economy improves. Two-thirds (66%) of organizations are already saying that they are having a difficult time recruiting for specific job openings. This difficulty is likely to increase as the economy continues to improve and as the Baby Boom generation begins to retire, leaving many more job openings to fill.

• In the next several years, many organizations will focus on improving their recruiting processes as a way to deal with greater challenges in filling jobs. More dollars set aside for recruiting are likely to lead to even more investments in expanding advertising efforts while organizations also hone their use of social media to find passive job seekers.

• In the longer term, many organizations may have to boost their training investments to build qualified talent from within. Lack of relevant qualifications and competition for talent are the top reasons HR professionals give for difficulty hiring qualified full-time employees; training existing employees can help more of them qualify for hard-to-fill jobs and also acts as a retention tool. More organizations will collaborate with educational institutions to create a more qualified local talent pool.

• Global competition for skilled and educated employees is likely to increase in the years ahead. Though currently only 13% of organizations believe they are facing global competition for qualified applicants for jobs they are having difficulty filling—a decrease from 23% reported in 2011—as working-age populations around the world shrink, competition for qualified workers is likely to grow. Larger organizations in particular could increase their numbers of hires from outside the U.S. Businesses in the STEM (science, technology, engineering and math) fields are also likely to look outside U.S. borders for the needed workers, as is already occurring in the high-tech industry.


In general, in the current labor market, are you having a difficult time recruiting for certain types of full-time regular positions that are open in your organization?

Note: Respondents who answered “don’t know” were excluded from this analysis. Only respondents whose organizations were currently hiring full-time staff were asked this question.

Yes; 52%No; 48%

2011

Yes; 66%

No; 34%

2012

n = 1,568 n = 2,562


In general, in the current labor market, are you having a difficult time recruiting for certain types of full-time regular positions that are open in your organization?

Note: Only statistically significant differences are shown.

Comparisons by industry

High-tech(82%)

Manufacturing(79%)>

Federal government (50%)

Finance (66%)

Health (65%)

State or local government (52%)

Construction, mining, oil and gas (74%)

Professional services (70%)>



Finance (66%)

Health (65%)> State or local government (52%)


• The high-tech and manufacturing industries are more likely than the federal government, finance, health and state or local government industries to be having difficulty recruiting for certain types of full-time regular positions.

• The construction, mining, oil and gas, and professional services industries are more likely than the federal government and state or local government to be having difficulty recruiting for certain types of full-time regular positions.

• The finance and health industries are more likely than the state or local government to be having difficulty recruiting for certain types of full-time regular positions.


What are the main reasons that your organization experiences difficulty in hiring qualified candidates for full-time regular positions?

Note: n = 1,647. Percentages do not total 100% due to multiple response options. Respondents who answered “don’t know” were excluded from this analysis. Only respondents whose organizations were having a difficult time recruiting for certain types of jobs were asked this question.

Candidates do not have the right skills for the job

Candidates do not have the right work experience

Qualified candidates are not within our salary range or hourly range rate

Competition from other employers

Low number of applicants

Candidates do not have the needed credentials/certifications

Qualified candidates are not interested in moving to our local area

48%

40%

35%

35%

24%

21%

14%


What are the main reasons that your organization experiences difficulty in hiring qualified candidates for full-time regular positions? (Continued)

Note: n = 1,647. Percentages do not total 100% due to multiple response options. Respondents who answered “don’t know” were excluded from this analysis. Only respondents whose organizations were having a difficult time recruiting for certain types of jobs were asked this question.

Candidates do not have high enough levels of edu-cation/training

Candidates are overqualified

Lack of interest in type of job

Qualified candidates are not able to move to our local area (due to mortgage or other issues)

Our local education/training system does not produce enough work-ready/qualified job candidates

Our organization does not provide relocation funds

Other

11%

6%

6%

6%

6%

4%

7%


What strategies is your organization using to deal with recruiting challenges for full-time regular positions?

Note: n = 1,635. Percentages do not total 100% due to multiple response options. Only respondents whose organizations were having a difficult time recruiting for certain types of jobs were asked this question.

Expanding advertising efforts

Using social media to find passive job seekers

Collaborating with educational institutions

Expanding search region

Training existing employees to take on the hard-to-fill positions

Increasing retention efforts

47%

44%

37%

36%

33%

32%


What strategies is your organization using to deal with recruiting challenges for full-time regular positions? (Continued)

Note: n = 1,635. Percentages do not total 100% due to multiple response options. Only respondents whose organizations were having a difficult time recruiting for certain types of jobs were asked this question.

Providing monetary incentives to candidates (e.g., signing bonus)

Improving compensation/benefits package

Offering more flexible work arrangements

Expanding training programs to help improve skills of new hires

Offering new job perks

Other

None; we have not changed our recruiting strategy

24%

24%

22%

21%

5%

5%

8%


Do you believe that your organization is facing global competition (i.e., competition from other countries) for talent for hard-to-fill jobs?

Note: Respondents who answered “don’t know” were excluded from this analysis. Only respondents whose organizations were having a difficult time recruiting for certain types of full-time jobs were asked this question.

Yes; 23%

No; 77%

2011

Yes; 13%

No; 87%

2012

n = 720 n = 1,492


The Ongoing Impact of the Recession—Global Competition and Hiring Strategies ©SHRM 2013 14Note: Only statistically significant differences are shown.


High-tech(33%) >

Finance (5%)

Health (6%)

Manufacturing(15%)

Professional services (14%)



Federal government (22%)>

Finance (5%)

Health (6%)


Manufacturing(15%) >Finance (5%)


Professional services (14%) > State or local government (4%)

Comparisons by industry• Organizations in the high-tech industry are more likely than those in the finance, health, manufacturing, professional

services and state or local government industries to believe that they are facing global competition for talent for hard-to-fill jobs.

• Organizations in the construction, mining, oil and gas, and federal government industries are more likely than those in the finance, health and state or local government industries to believe that they are facing global competition for talent for hard-to-fill jobs.

• Organizations in the manufacturing industry are more likely than those in the finance and state or local government industries to believe that they are facing global competition for talent for hard-to-fill jobs.

• Organizations in the professional services industry are more likely than those in the state or local government to believe that they are s facing global competition for talent for hard-to-fill jobs.




Comparisons by organization staff size

2,500 to 24,999 employees (22%) >

1 to 99 employees (8%)


500 to 2,499 employees (13%)

25,000 or more employees (25%) >1 to 99 employees (8%)



• Organizations with 2,500 to 24,999 employees are more likely than organizations with 1 to 2,499 employees to believe that they are facing global competition for talent for hard-to-fill jobs.

• Organizations with 25,000 or more employees are more likely than organizations with 1 to 499 employees to believe that they are facing global competition for talent for hard-to-fill jobs.


Has your organization hired any workers from outside the United States in an attempt to staff key jobs that have been difficult to fill?


Yes No No, but we are considering it

No, but we have plans to do so in the

next 12 months

24%

72%

4%0%

24%

72%

3% 1%

2012 (n = 1,566) 2011 (n = 755)





High-tech(50%) >



Finance (16%)

Health (29%)

Manufacturing(24%)




Health (29%)

Manufacturing(24%)


> State or local government (11%)


• The high-tech industry is more likely than the construction, mining, oil and gas; federal government; finance; health; manufacturing; professional services; and state or local government industries to have hired workers from outside the U.S. in an attempt to recruit for hard-to-fill jobs.

• The construction, mining, oil and gas; health; manufacturing; and professional services industries are more likely than the state or local government to have hired workers from outside the U.S. in an attempt to recruit for hard-to-fill jobs.





500 to 2,499 employees (31%)

2,500 to 24,999 employees (34%)

25,000 or more employees (42%)

>1 to 99 employees (16%)



• Organizations with 500 or more employees are more likely than organizations with 1 to 499 employees to have hired workers from outside the U.S. in an attempt to recruit for hard-to-fill jobs.


Has your organization hired any U.S. veterans in an attempt to staff key jobs that have been difficult to fill?


Yes No No, but we are considering it

No, but we have plans to do so in

the next 12 months

58%

26%

12%

4%

39%

46%

12%

3%

2012 (n = 1,415) 2011 (n = 651)





Federal government (87%) >

Finance (40%)

Health (57%)

High-tech(47%)

Manufacturing(60%)



State or local government (71%)>

Finance (40%)

High-tech(47%)


Manufacturing(60%) >Finance (40%)


Comparisons by industry• The federal government is more likely than the finance, health, high-tech, manufacturing and professional

services industries to have hired U.S. veterans in an attempt to recruit for hard-to-fill jobs.

• The construction, mining, oil and gas, and state or local government industries are more likely than the finance, high-tech and professional services industries to have hired U.S. veterans in an attempt to recruit for hard-to-fill jobs.

• The manufacturing industry is more likely than the finance and professional services industries to have hired U.S. veterans in an attempt to recruit for hard-to-fill jobs.





2,500 to 24,999 employees (84%)

25,000 or more employees (87%)>



500 to 2,499 employees (68%)

500 to 2,499 employees (68%) >1 to 99 employees (30%)


100 to 499 employees (48%) > 1 to 99 employees (30%)


• Organizations with 2,500 or more employees are more likely than organizations with 1 to 2,499 employees to have hired U.S. veterans in an attempt to recruit for hard-to-fill jobs.

• Organizations with 500 to 2,499 employees are more likely than organizations with 1 to 499 employees to have hired U.S. veterans in an attempt to recruit for hard-to-fill jobs.

• Organizations with 100 to 499 employees are more likely than organizations with 1 to 99 employees to have hired U.S. veterans in an attempt to recruit for hard-to-fill jobs.


Demographics


Demographics: Organization Industry

Note: n = 3,481. Percentages do not total 100% due to rounding.

State or local government

Manufacturing

Professional services

Health

Finance

Construction, mining, oil and gas

High-tech

Federal government

Other

20%

14%

13%

13%

11%

10%

7%

7%

6%


Demographics: Organization Sector

n = 3,294

Privately owned for-profit

Government

Publicly owned for-profit

Nonprofit

Other

43%

25%

17%

12%

3%


Demographics: Organization Staff Size

n = 3,208

1 to 99 employees

100 to 499 employees

500 to 2,499 employees

2,500 to 24,999 employees

25,000 or more employees

26%

33%

19%

16%

6%


n = 3,311

Demographics: Other

U.S.-based operations only 76%

Multinational operations 24%

Single-unit organization: An organization in which the location and the organization are one and the same.

36%

Multi-unit organization: An organization that has more than one location.

64%

Multi-unit headquarters determines HR policies and practices

50%

Each work location determines HR policies and practices

3%

A combination of both the work location and the multi-unit headquarters determines HR policies and practices

47%

Is your organization a single-unit organization or a multi-unit organization?

For multi-unit organizations, are HR policies and practices determined by the multi-unit headquarters, by each work location or by both?

Does your organization have U.S.-based operations (business units) only, or does it operate multinationally?

n = 3,325

n = 2,204

Corporate (companywide) 68%

Business unit/division 19%

Facility/location 13%

n = 2,206

What is the HR department/function for which you responded throughout this survey?

• Response rate = 15%

• 3,481 HR professionals from a randomly selected sample of SHRM’s membership participated in this survey

• Margin of error +/-2%

• Survey fielded August 28–September 14, 2012


SHRM Survey Findings: The Ongoing Impact of the Recession—Overall Financial Health and Hiring

Survey Methodology


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About SHRM Research

Project leader:Tanya Mulvey, survey research analyst, SHRM Research

Project contributors:Alexander Alonso, Ph.D., SPHR, vice president, SHRM ResearchEvren Esen, manager, Survey Research Center, SHRM ResearchJennifer Schramm, GPHR, manager, Workplace Trends and Forecasting,

SHRM Research

Copy editor:Katya Scanlan, SHRM Knowledge Center

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