When you need to hire talent, today’s job market can feel like you’re wandering through the Upside Down in an episode of Stranger Things. On the surface, everything looks the same, but nothing is as it was just a few short years ago.
The pandemic turned everything on its head. Job seekers are looking for more than just salary, title, and room to grow. Almost overnight, hybrid and remote work environments, flexible schedules, mental health and wellness benefits, and a company culture that aligns with personal values became baseline expectations – instead of nice-to-haves – for many workers.
With the Great Resignation of 2021, companies are realizing that if they don’t do more, staff are willing to walk away. This reset sent the marketplace reeling and created unprecedented financial strain and internal panic on businesses across the globe.
Where Are We Now?
Since the pandemic stabilized, employers have been in a hiring frenzy. Right now, the U.S. unemployment rate is at its lowest point since just before the pandemic began, and job openings are at record highs. It is truly a candidate’s market.
Not surprisingly, sourcing candidates is much harder than it used to be. It’s time for businesses to pivot and adopt a new hiring and retention mindset. This includes resetting the pay scale and addressing pay equity.
As the talent pipeline tightens, the need to offer competitive pay is more important than ever. Historical data is no longer an accurate gauge of pay range. Compensation analysis is a valuable tool, but reporting lag time does not always accurately reflect going rates. In a market this hot, you need to beat real-time offerings to stand out and win talent. By competing with the pay scales of current marketplace postings, you will save valuable time and money hiring and, importantly, retaining qualified staff.
Along with wage increases for new hires comes the potential for a widening pay gap, which can create flight risk among existing employees. The tight labor market, post-COVID work attitudes, and wage inflation have come together to create a perfect storm that causes salary compression and pay equity discrepancies. Add to this the fact that 63% of employees already believe that they are not being paid a fair rate by their existing employer and most think they could make more by switching jobs, and you have a dangerous recipe for employee turnover.
It is imperative to proactively address pay equity issues before they are brought to the HR table to improve employee satisfaction and retention rates. The last thing you want is to lose established talent in order to save a dollar. People are seeing open market rates that make it near impossible not to jump ship for better opportunities. When they ask for fair and equitable pay, don’t let good staff walk – you will lose productivity, and it will cost you twice as much in recruitment and onboarding. And, in a market this competitive, you will end up paying more anyway, because a qualified new hire will expect the going rate.
Attracting Talent in the New Normal
Talent acquisition is more complex than ever. To be successful at acquiring – and retaining – talent in today’s hot market, you need help navigating the new normal. Accommodating the fundamental changes to the way we work and paying more are not easy pills to swallow. But if you want to find and keep the best people, it’s the smartest move you can make and will end up saving you in spades.
It’s more critical than ever to know what steps to take secure top talent at the best price.
At Empirical Consulting Solutions (ECS), we have your back. Our talent acquisition and human resources specialists are here to deliver solutions and support that get you the results you need in an über-competitive labor market. Connect with us on our website, or email ECS Managing Partner Jason Fisher to learn how we can help.