Startup Growing Pains: Attracting and Retaining Top Talent in a Remote World
Hiring top talent has never been easy, and COVID-19 has only added complexity to the labour market. Here’s how SMEs and startups can compete with larger organisations to attract and retain A-players.
Top talent matters. Studies have shown that in highly complex occupations, such as managers or software developers, top performers are an astounding 800 per cent more productive than the average employee.
However, winning the war for top talent is a challenge even for the savviest CEOs. This is how difficult it is to find and hire the best minds and how SMEs and startups can compete with the ballooning budgets of big corporations.
How hard is it to attract top talent right now?
The war for top talent is getting fiercer, more technological and, most importantly, global.
As of April 2021, there were over 9 million open jobs in the U.S., a record high. However, reports show employers are scrambling for ways to fill their open positions. While it might sound contradictory, the U.S. is experiencing higher unemployment numbers and a labour shortage.
In medium- and high-complexity positions, where stronger performers have an increasingly disproportionate bottom-line impact, the impact is even more noticeable. In uncertain times, gainfully employed talent became less likely to change employers.
Before the pandemic struck, the number of advertised roles outpaced the volume of applications submitted. But that changed with the outbreak of Covid-19. In April 2021, the number of advertised roles was up 52.5% compared to pre-pandemic levels, but job applications were still down 12.5% from pre-COVID levels.
Managers are not new to this shortage of applicants. Failure to attract and retain top talent is the number-one issue concerning CEOs. In more complex jobs, this will continue to be true as technology demands more sophisticated skills.
Alarmingly, 82 per cent of companies don’t believe they recruit highly talented people. For companies that do, only 7 per cent think they can keep it. And only 23 per cent of managers and senior executives believe their current acquisition and retention strategies will work. What makes hiring top talent so challenging?
Attracting top talent has never been easy. However, COVID-19 has unleashed a complex labour market that is making top talent unprecedentedly hard to find. Demand for skilled, qualified people outpaces supply. With so many enterprises competing for top talent, it’s harder for companies — especially smaller businesses — to hire the best people.
Here are a few reasons:
- Workers are still hesitant to start a new role as COVID-19 lockdowns and restrictions continue
- People are unwilling to switch to a new career amid ongoing uncertainty in the global market
- Wage growth, a potent motivator for pursuing and accepting a new role, has been stagnating over the past year at just 1.5%, below inflation, which is forecast to grow by 1.75%
- Pressure to reduce HR costs makes it harder to identify and attract the most talented people
All this suggests that the war for talent will rage on. Recruiters are working much harder to find enough applicants for a role. And they’re doing so while fighting for in-demand talent with pandemic-level compensation and benefits. This makes it even harder to attract top talent.
So, how do you attract high-quality talent in a labour market that keeps defying previously established business patterns?
Levelling the playfield: how to attract top talent
Picture a world without yearly performance reviews. Hubspot, Salesforce.com and other leading tech companies did, almost ten years ago. This is just an example of the lengths large enterprises are resorting to attract and retain the best minds on the planet. Bigger paychecks, higher flexibility, and a more engaging management style are other avenues being pursued to attract top talent.
But for SMEs, recruiting top talent may seem like an uphill battle. After all, large corporations hold all the budget cards. But studies have shown that there are other ways to compete for smaller, more budget-minded organizations.
If you’re not in a place to woo the best workers with higher salaries, you must win their attention by offering the best place to work. This is how.
COMPETE IN BENEFITS RATHER THAN PAYCHECKS
Companies battling for top talent should be unafraid of getting creative with employee perks: wellness programs, home office supplies, gym passes or fitness classes, office book clubs, spa services, generous maternity and paternity leave or flex time. Adding unique perks to your benefits package can help you stand out from other employers.
INCREASE FLEXIBILITY
Talented professionals flock to urban areas to take high-paying jobs. Businesses in less desirable areas naturally end up drawing from a limited applicant pool. For these companies, location is arguably the single biggest barrier to attracting top talent. If possible, give employees the opportunity to work remotely. By letting people telecommute, you can bring world-class talent into the fold from afar.
UPSKILL CURRENT EMPLOYEES
The best candidates must be able to grow. This is especially true for Millennials, with 74% citing better career development opportunities as a top attractor. In the aftermath of COVID-19, upskilling and reskilling are especially important.
Reskilling is defined as the development of additional skills and new capabilities to help one move to a new role, whereas upskilling is the training that enables one to become better at a job they already perform. As learners continuously react to the market and gain new required skills, they become an adaptable force that can shift and bend with any changes in your market.
As a result, employees will have a greater wealth of knowledge, become used to problem-solving and market demands, allowing businesses to leverage their skills to carry your organization across murky waters.
INCREASE TRANSPARENCY AND ACCOUNTABILITY
Having the right company culture in a workplace can make all the difference in making a position more marketable for potential employees. Having the right culture for the right talent could include opportunities for flexible working, the level of autonomy given to employees or even providing more face time with leaders.
LOOK ABROAD FOR TOP TALENT
Finding the right individual that combines technical expertise, domain knowledge, and has a good cultural fit is almost an insurmountable task. And unless you can compete with top market compensation, there is little chance you can actually hire the best. Solution? Expand your market pool to different shores.
Welcome to Portugal, a leading tech destination and the place to be for high standards of living at affordable prices. This is where both start-ups and established tech giants come to find top-notch technology and infrastructures, a business-friendly environment and a cost-competitive & highly skilled workforce. Our Employer of Record service in Portugal is designed for tech and tech-enabled companies that are looking to hire great tech, sales and customer success teams in Europe in a cost-effective way, without the need to establish a local subsidiary. With fully owned operations in Portugal, we are experts in local labour regulations, taking care of back-office payroll, insurance, benefits, and taxes on your behalf.
Changing recruiting strategies is hard. It involves a cultural shift, investing time in upskilling, getting creative with perks and hiring internationally. But it will also improve hiring results. Book a call to find out all about how we can help you attract top performers from one of the leading talent pools across the globe.
Originally published at https://www.bridgein.pt on February 8, 2022.
