Vice President & General Manager, RPO, Global
This Week in Leadership (July 19 - July 25)
What the Delta variant means for office returns. Solving the labor shortage with returnships. Plus, tips for how to be a great board director.
No one said predicting the future was easy. Not many people expected a global pandemic to completely upend life worldwide in 2020.
Still, even as hundreds of millions of people moved to remote work—and tens of millions more lost their jobs—some trends that talent acquisition specialists identified at the start of 2020 actually came to pass. Companies continued to phase out raises-for-everyone pay policies. Leaders struggled mightily with keeping their employees engaged. Organizations still wanted more digitally savvy workers. And companies doubled down on efforts to diversify their employment bases and leadership ranks.
Those trends should continue into 2021, according to Korn Ferry experts across industries. At the same time, the pandemic has spurred companies to rethink a variety of hiring policies and practices that were once held sacrosanct. Here are seven key ones for both leaders and job hunters.
Jobs are moving
The pandemic has upended the expectations of what work can be done outside of an office. While companies will spend the next several months figuring out which current roles need to come back to the office, there may be less debate about where new recruits actually reside. “Companies are hiring for talent where the talent is versus requiring them to be at a corporate office or specific location,” says Jacob Zabkowicz, vice president and general manager of Korn Ferry’s Recruitment Process Outsourcing business. This isn’t just a US-centric trend, either. Roles that historically have been filled in a particular office in a particular country are now open to people who live in a different nation or even a completely different part of the world, Zabkowicz says.
That’s potentially good news for both companies and workers. Many people with in-demand skills don’t live in places where the companies that want to hire them are located—and have no desire to move. The ability to look for work now anywhere, and accept it without moving, is obviously appealing for job hunters stuck in low-hiring markets. At the same time, lifting geographic boundaries on employees could expand a company’s pool of qualified candidates significantly.
The second-half exodus
In February 2020, about 2.3% of US non-farm workers quit their jobs, about the average rate over the prior four years. By April, in the heart of the first series of lockdowns, that figure dipped to 1.4%, a sharper decline than even during the Great Recession. Millions of people were just happy to be employed.
That quit rate has gradually increased since then, but analysts believe it could spike above the pre-pandemic rate in the second half of 2021. With a growing sense that the new vaccine could ease the pandemic—and help the economy recover—people will become less averse to switching jobs. At the same time, some leaders worry that their employees, removed from the office for so many months, may be asking themselves if they really like what they are doing. “The engagement to the organization has been frayed,” says Melissa Swift, a Korn Ferry senior client partner and the firm’s global leader of workforce transformation.
Putting purpose first
Speaking of engagement, there’s even more evidence that workers who can connect their own sense of purpose to their employer’s business stay happier and more engaged on the job.
But there’s a twist in 2021. This push for purpose isn’t only among young employees, the cohort that’s traditionally considered the group that puts purpose first. The pandemic taxed the skills and stamina of many senior executives, and many are rethinking their own career paths. “These executives are thinking if they’re going to lean in that hard and heavy, it has to be something that they are passionate about,” says Tierney Remick, vice chair and coleader of Korn Ferry’s Board & CEO Services practice.
Organizations may have to make an effort to highlight the connections between its business purpose and the needs of its executives, too. “Without embracing the purpose of an organization—the motivating force of why it is so important that we exist—employees will become disenchanted,” says Kevin Cashman, Korn Ferry’s global leader of CEO and executive development.
Cash crunches. Supply chain breakdowns. Sick employees. Remote work. The pandemic gave boards and CEOs a chance to evaluate how talented and agile other senior company managers really are. “There’s been a lot of interaction between board and management, giving them keen insights into the potential and capability of other executives,” Remick says.
Some of those executives performed superbly. Others, not so much. C-suite teams and directors will be spending 2021 figuring out what skill sets the next few layers of management need to have and find new people to fill the roles. For instance, some manufacturing firms are finding that their chief technology officers need to know more about, surprisingly, technology. That role, for some organizations, has become too focused on managing people and not on the actual work, Swift says.
The inclusion push continues
The protests triggered by the killing of George Floyd resonated worldwide, and companies big and small vowed to increase their hiring of people from underrepresented groups. Activists will be keeping a close eye on whether organizations live up to their commitments.
Whether the push to become more diverse and inclusive may hinge on two little-seen interactions happening in 2021. First, board directors are looking to be more inclusive in the broadest possible way, Remick says, which means finding new directors of varying backgrounds, gender, and skill sets. Second, while human resources departments have spent the past few years trying to install technology to reduce hiring bias, they’re also making a concerted effort to talk with hiring managers about both the benefits of a diverse workforce but also the ways unconscious bias can occur. Those conversations are critical, Swift says. “HR may bring in a diverse talent pool, but a hiring manager can, even inadvertently, block diversity efforts,” she says.
Companies had already started becoming more reluctant with across-the-board cost-of-living increases. Now firms have a new reason to be even more frugal: tighter budgets. Only one-third of organizations plan to give raises to all of their employees in 2021, according to the most recent Korn Ferry Global Salary Survey. Indeed, 16% of the organizations polled are planning no salary increases for employees in 2021—three times the number that skipped pay raises in 2020. On every continent, increases are expected to be lower than in 2020, with declines ranging from 0.3% in North America to 2.9% in Africa.
Compensation is key to recruiting and retaining talent, of course, but organizations are hoping that adding some new and creative forms of nonfinancial compensation will help. Expect firms to allow younger employees to use matching 401(k) funds to pay off student debt instead or help to refinance loans at a lower rate, says Don Lowman, a Korn Ferry senior client partner and the firm’s leader of global total rewards.
Retrain over hire new
Companies of all sizes have been scrambling to find digitally savvy talent. But when it comes to reskilling employees, it’s often only the biggest of big firms that are willing to make major commitments to retrain their own employees. The rest prioritized looking for new recruits. But experts believe more companies may adopt the retraining route in 2021. New budget realities are setting in for some firms, but for others it’s a frustration that many of the new recruits aren’t staying long, says Swift. “Companies would like to break the endless cycle of hire, wash out, and rehire,” she says.
Even though retraining can be expensive, more organizations are beginning to believe it’s a worthwhile investment. Firms are hoping that improving workers’ hard skills, such as programming or data analysis, and soft skills, such as learning agility and organizational awareness, will help its staff be ready for the jobs of tomorrow (and maybe convince more employees to stick around).