With global economies opening up and The Great Resignation in full swing, salaries are set to skyrocket in 2022 with 54% of businesses planning to increase employee compensation to continue to attract top talent, reveals a new report by hiring platform, HireVue.
The HireVue Global Hiring Landscape surveyed 1657 hiring leaders across Australia, US and the UK as well as more than 1000 Australian consumers at the end of 2021 and early 2022 to understand the impacts of the COVID-19 pandemic on the hiring industry.
It found that skills shortage continues to plague business leaders globally as the number one talent challenge and employee retention leads as a pressing priority facing businesses in 2022.
New tactics for navigating talent shortages
With one in four companies experiencing voluntary turnover of at least 13% of their employee base in 2021 and border closures blocking access to skilled migrant workers, there’s a heightened focus on employee retention among Australian employers.
To address this, more than half of businesses globally are prioritising internal promotions (55%) and a further 57% are investing in job matching technology to fill this gap, says the surevy.
No resources are being spared in the effort to retain talent with 44% of companies adding learning and development allowances to their budgets, 42% adding employee recognition programs, and over half (54%) increasing employee compensation.
The increase to salaries comes as employee expectations have evolved during the global pandemic. Better salary is now the key reason driving half of Australians to want to leave their job, followed by better benefits (28%) and burn out (22%).
With the latest figures from the Australian Bureau of Statistics revealing a 2.2% overall wage increase in the 12 months to September 2021, The Great Resignation could see these figures rise exponentially as hiring managers offer increasingly high remuneration packages to attract and retain talent in 2022.
Despite the potential for wage growth, flexibility still reigns as a key priority for Australian workers. Today, 31% of Australian employees would be willing to take a pay cut to work remotely, and of those, almost three in 10 (29%) would accept a pay cut of 10% or more.
Can’t hire fast enough
In 2020, 16% of employers were able to fill a vacant position in under a week. In 2021 that number dropped by more than half to just 7%. To speed up the interview process while simultaneously ensuring candidate diversity and mitigating bias, over three quarters of businesses have implemented virtual interview tools (77%) in the past year.
This provided over half of businesses with increased flexibility and time saving benefits (54%), with Australian hiring managers demonstrating the highest adoption over the US and UK for use of chatbots during the hiring process to enable communication even outside of traditional working hours.
In Australia, businesses with limited talent pools as a result of lengthy border closures are reframing the way they see talent, with hiring managers expected to increasingly source talent from underrepresented demographics such as mature aged workers (47%), neurodiverse workers (29%), non-permanent residents (28%) and veterans (21%).
Technology is more important now than ever
Faster turnaround time for new hires is the top-ranked change talent leaders want to see in 2022, but a streamlined hiring process has proven to be just as important to the candidate as to the employer.
Over half of Australians (53%) said they would be less likely to apply for a role that has a long hiring process, with 'too many interviews' most likely to put an applicant off. To put a number on how many interviews is too many, 44% would be put off by three or more.
In what has become a chicken and egg situation, nearly half of talent teams (43%) feel under-resourced compared to last year leading to significantly more talent leaders citing “recruiting resources” as their biggest barrier to finding top talent.
“Australia’s geographical positioning throughout the pandemic has led to one of the most chasmic skill gaps in the world. For a country that relies heavily on a migrant workforce, we have seen first-hand what a lack of talent can do to an industry. The use of technology will be instrumental both for employers and employees when it comes to quickly and efficiently managing hiring processes without compromising on talent and skills. Human biases can rely too heavily on a ‘gut feeling’ at the interview stage, which can result in both output and cultural problems later down the line,” says Tom Cornell, Head of Assessments APAC at HireVue.
“Adding automation to the hiring process can save businesses an average of 14 hours per week in screening and scheduling, plus an additional 12 hours per week in other administrative tasks - this will be game changing for businesses when resignations force mass hiring on teams with minimal capacity. With wages on the rise, businesses will need all the help they can get to find and retain the right staff as we head into 2022,” Cornell adds.