Attracting and retaining talent remains a huge challenge for businesses as the nation begins to emerge from the upheaval of the pandemic. According to the 21st edition of the EY Global Capital Confidence Barometer, six out of 10 middle-market companies say they face difficulty when it comes to finding and keeping skilled employees.
“The much-mooted threat to jobs from technology is not playing out as many had predicted,” states the EY report. “Indeed, as more jobs are automated in routine tasks, companies are finding it more difficult to attract and retain talent with the right technical and digital skills to benefit from these efficiencies.”
Pervasive Throughout All Industries
Talent acquisition and retention is the top concern among business leaders in 2022, according to a survey conducted by Protiviti and NC State University. “Most if not all of the organizations that we’re speaking with are struggling with things like attracting, retention, engagement, upskilling,” Protiviti Managing Director Fran Maxwell said during a recent webcast. “It’s pervasive throughout all industries, throughout all organizations now.”
Some employers are trying to attract and retain talent by boosting compensation. In November, hourly private sector wages rose 4.8%, according to the Department of Labor. And companies have budgeted 3.9% wage increases for this year, which is the biggest bump since 2008, according to the Conference Board. Unfortunately, these increases aren’t keeping pace with soaring inflation, which reached 7.9% in February, a four-decade high.
However, Maxwell notes that raising pay isn’t the only way to attract and retain talent. He recommends that businesses also make efforts to improve the employee experience — for example, by offering flexible or hybrid work arrangements, access to learning and development programs and creating a work atmosphere of well-being.
“Organizations that will win the talent war will focus on differentiating an employee experience, making it different for each employee,” said Maxwell.
Competing with Big Businesses for Talent
Large corporations have historically held the edge when it comes to brand marketing and employee recruiting. In the current environment, however, some middle-market firms are finding that they can compete with their bigger brethren by positioning themselves as an attractive alternative to large organizations.
One way to do this is to focus on the “power of purpose.” In the 2019 Mission and Culture Survey conducted by Glassdoor, eight out of 10 respondents said they consider a company’s mission and purpose before applying for a job there.
Purpose answers the questions: Why does your company do what you do? And for whom do you seek to create value? It’s often easier for middle-market companies to clearly articulate their purpose to employees and live it out authentically than it is for large corporations. Doing so
enhances the employer value proposition for employees, including highly skilled candidates looking for the right employer.
Another way middle-market companies are successfully competing for talent against large corporations is by offering employees accelerated career advancement opportunities. These companies often have more flexibility when it comes to things like giving employees earlier and more frequent client interaction, greater job responsibility and autonomy, more supervisory responsibility, and participation in strategic decision making.
More Middle-Market Advantages
With their agility, middle-market companies can also usually create flatter management structures. These tend to give employees more opportunities to interact with upper managers and move more freely between management layers throughout the company.
Embracing technology and creating a culture of innovation is yet another strategy middle-market companies can adopt to attract and retain talent. Large organizations are often slow to adopt the latest and greatest technologies, but nimble middle-market companies can usually implement technology and innovation more easily.
In the EY Global Capital Confidence Barometer survey, half of the respondents said they are leveraging technology and automation to improve workforce productivity. After watching so many innovation-driven startups quickly transform themselves into some of the world’s most valuable companies, many talented young employees now view organizations like this as attractive places to advance their careers.
Finance as a Service, or FaaS, can be a solution to finance department staffing challenges faced by many middle-market companies today. With FaaS, finance and accounting software and technology is managed by a third-party service provider. This includes recruiting, hiring, training, retaining and developing all finance and accounting team members. FaaS is a fully managed solution which gives executives more time to focus on strategic planning, analysis and forward-looking initiatives.
Questions to Ask
As you consider how your company can scale and compete successfully with large corporations for the best and brightest employees, ask yourself whether you’re really thinking about the mindset of the employees you want to attract. Also, do you know what factors give you a hiring edge over large organizations and are you capitalizing on them?
And perhaps most importantly, are you creating an exciting, dynamic corporate culture that embraces technology and innovation? These are the kinds of organizations most of the high-demand young employees today are looking for.
Could You Benefit from FaaS?
Could you be leveraging a third-party service provider to handle hiring and retention of your finance and accounting staff for you? Doing so could reduce the amount of time and resources you spend on tasks that take your focus away from growing the business.
To discuss the potential benefits of FaaS for your business in more detail, please request your complimentary consultation here.