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Report: Employer Outlook 2018

We’ve all heard that the U.S. unemployment rate is at its lowest level in over a decade. That’s good news, of course. But as employers, we also know that this is the kind of good news that makes our own jobs just that extra bit tougher.

It’s not just that competition for talent is fierce. We have to contend with a lot of other things, too: whether it’s the economic ups and downs of our respective industries, or the new technologies that are transforming the workplace, leading to demand for new skills while making others obsolete. And these changes cut across every industry, even if the impact isn’t always the same.

So how are employers preparing to face these challenges as we enter 2018? We surveyed 1,000 of them to find out. Let’s take a look at the results.

Get ready for a hiring boom

It turns out that employers are feeling pretty bullish.

How bullish? Well, 61% of respondents told us that they expect to hire more people in 2018 than they did in 2017. By contrast, just 10% of surveyed companies are planning to reduce their rate of hiring, while the rest plan to maintain current levels.

So if you think the hiring landscape is competitive now, just wait a few months.

What’s driving this? A lot of it is coming in response to current or projected business success. 56% of employers told us they are hiring to support business growth, while 31% are hiring for a specific skill and only 13% are replacing lost staff.

Which industries are doing the most (and least) hiring

Most companies in nearly every industry will see a jump in hiring in 2018, but some will be more aggressive than others.

The most active sectors for recruiting are architecture and engineering where 82% plan to hire, IT and telecom companies (75%) and professional services firms (71%).

At the other end of the spectrum we find that just 55% of retail companies and only 41% of educational organizations plan to recruit more people next year.

Comparatively low figures for the retail sector may evoke headlines about the “retail apocalypse.” However, at its Annual Global Retailing Conference this fall, Goldman Sachs reported that 76% of retail companies it surveyed had earnings that beat out their second quarter estimates. And given that retail occupations account for nearly 6% of employment in the US, that’s still a lot of hiring.

We also see differences across the regions, with one in particular racing ahead of the others: the Southwest. Here a full three quarters (75%) of companies are looking to hire more people in 2018.

The good news for recruiters here (at least in urban areas) is that the Southwest is attracting more and more people: Many of the fastest growing metros in the country are in the Southwest or West, according to the BLS. The West, Southeast, and Midwest by contrast have similar hiring expectations at 62%, 61% and 60%, respectively. The Northeast comes in last: here only 57% of companies anticipate hiring increases.

More than 40% of employers worry they won’t get the talent they need

So nearly everyone’s planning on doing more hiring. But when it comes to the question of filling those open roles, employers aren’t quite so bullish. In fact, 42% of those that we polled are concerned that they may fall short.

And while a lot of the conversation surrounding today’s talent shortages is focused on the need to find highly skilled workers, the truth is that this issue impacts hiring at all levels. In fact, 41% of companies say their entry-level positions are hardest to fill.

Hiring for these roles proves to be the biggest challenge for 55% of companies in the retail industry and 52% of healthcare companies, which already face the challenge of the nursing shortage.

By contrast, 33% of companies are concerned about hiring middle management, 25% report challenges with senior management and 20% pointed to executive level positions as their most difficult hires. 

So why are entry level hires so tough? Well, when it comes to higher level positions, then hiring managers usually have more flexibility to sweeten the pot with additional money, better perks and stronger incentives for more experienced workers.

With entry level workers, there just isn’t the same leeway. But the difficulty in attracting these candidates may be a sign that it’s time for companies to shift some of their incentives from experienced job seekers to the fresh talent that keeps businesses running.

Alternatively, it may be time to look at those job descriptions again. Are you really hiring for entry level jobs, or are you asking for one or two years’ experience? Frequently on Indeed we see employers listing jobs as “entry level” when in fact they are asking for one or two years’ experience.

If you can’t find that experience it may be time to switch your focus to core competencies and transferable skills, or consider internships or other indicators of effort.

Despite fears of the “retail apocalypse” firms in this sector are still hiring

When it comes to hiring limitations imposed by financial restrictions, employers in the transportation industry have the biggest concerns. Here,  40% of companies worry that they won’t have the budget to make the hires they need.

Little wonder: while truck drivers currently earn an average of $43,590 the driver shortage has been pushing wages up for some time now, placing a bigger financial burden on employers. In fact, compensation has risen by 8% to 12% a year according to Bob Costello, chief economist at the ATA. The ATA also reports that the median salary for a driver in a private fleet can be as high as $73,000.

It seems, then, that for the time being employers are going to have to dig deep to attract drivers.

This concern is also high in the healthcare industry, where staff shortages also lead to high salaries: here, 34% of companies share that worry.

In the retail sector, it’s a different picture. Here salaries tend to be lower, and we find that 75% of retail companies report that they will have the budget to make the necessary new hires. Once again, reports of the “retail apocalypse” may not reflect the more complex reality here. 

For companies that need to make strong hires under budget constraints, non-monetary benefits like extra PTO, flexible hours and work from home options can tip the scales for job candidates.

The employer outlook on the economy is bright—for the most part

While most people are optimistic about their industry and business outlook, 27% have a general fear of economic slowdown. This fear is most pronounced in the booming Southwest, where about 36% of businesses are scared of an economic slowdown. 

And professionals in certain industries are more concerned than others. For instance, the percentage of employers concerned about a slowdown jumps to 54% when we look at manufacturing companies, 52% when we look at finance companies and 50% when we look at travel and transportation companies.

Even with these looming fears, companies that are looking forward to a promising year of hiring should start taking steps to prepare for a more competitive landscape.

Looking ahead to 2018

As you get ready to vie for the candidates, it pays to be strategic about where you’re finding jobseekers and how you’re catching the eye of top talent.

Start by looking at your existing people. Employee referrals are the most common source of new hires, with 73% of companies using this method to hire new employees. Job sites came in at a close 71%, with recruitment and staffing firms coming in at 51%.

Advertising still plays a strong role as well, with 42% of companies getting hires through digital ads and 38% from print ads.

And of course, Indeed has solutions that can provide assistance. Through our platform you can not only share job listings, but you can also browse resumes and get your brand in front of talented jobseekers. Want to know more? Click here to learn how Indeed can help you get a head start in 2018’s race for top talent. Happy hiring!

Kevin Walker is Senior Director of Field Marketing at Indeed

Methodology: Censuswide surveyed over 1,000 currently employed HR leaders at US companies with 100 employees or more in October 2017.

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About Mildred Blankson

I am a Human Resource Professional with a Masters Degree in Human Resource Management. I have several years of experience in Human Resources and i hope this blog will be a great resource in helping you find the perfect job or candidate that you seek.

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How to Leverage Company Benefits to Recruit and Retain Top Talent

One-third of organizations have increased their overall benefit offerings in 2016, according to a research report compiled by the Society for Human Resource Management (SHRM). As recruiting and retaining top talent continue to become increasingly difficult for employers, robust benefit packages play a key role. When salaries and perks (think: free lunch) are nearly equal from company to company, employees are likely to opt for the company that offers the best benefits and greatest opportunities.

Medical and financial benefits aside, employees are looking for lifestyle and career benefits. SHRM reported that the top reason employers increased benefits in 2016 was to remain competitive in the marketplace—and the three biggest focus areas for change were in the health (22%), wellness (24%), and professional and career development (16%) categories. Robust benefit packages that include career development, health and wellness, and flexible working options provide a platform for employers to stand out. Nearly one-third of employees look for external positions because they desire “overall better benefits,” second only to higher compensation.

The type of benefits you offer speaks volumes on how you treat and support employees, which always manifests by way of your external employer brand. It’s not enough to say “we have great benefits,” because “great benefits” are now table stakes. Companies have mastered the art of talking about perks, from catered lunches to team building activities. Failure to talk about the real support and development opportunities you offer to employees might translate to missed opportunities. So how can hiring managers and recruiters promote employee benefits to help with recruiting and retention?

#1: Kick “industry standard” out of your vocabulary

When recruiters and hiring managers list their company’s benefits and summarize with the catch-all phrase, we offer “industry standard” benefits, it’s not enough. When all else—compensation, vacation days, and perks—are even, offering a standard benefits package won’t help your company standout enough to secure commitment from a top employee. Even though it might be tempting to default to a quick response, it pays to provide more detail about the benefits your company offers, in length, during the interview process.

And even more importantly than providing a laundry list of benefits (but kudos to you for that list!), explain how these benefits fit in with core company values. For example, if you offer flexible work arrangements and flexible hours, explain that these arrangements support your company’s value of work-life balance. If you provide a gym membership or showers at work, talk about how it enhances company culture or creates opportunities for employees to get the exercise they desire in a convenient way.. When recruits begin to see how your benefits support their shared values and interests, they’ll see the benefits you offer are much greater than “industry standard.”

Employers hoping to keep a competitive edge are offering more than the “industry standard” at every stage of the employee journey, including at severance – according to a recent study by RiseSmart. If you’re on the cutting edge of severance offerings, use those benefits to differentiate your company form the competition.

#2: Talk about goals in the recruiting and interview process

Before an employee is even hired, find out what they’re looking for in their employer and what their short and long term goals are. Ask questions like, “Where do you see yourself in 5 years?” and “How are you hoping your employer will support you along your career journey?” Employees, many of whom are seeking opportunities for career development and continuing education, need to know you plan to invest in their individual career goals.

A Career Builder survey found that 45% of employees, regardless of generation, plan to stay with their employer for less than two years. During their tenure, they expect to benefit and grow with each new role and and at each new company. It’s important to convey to prospective employees that you invest in each individual employee, regardless for how long they plan to stay in the role for which they are being hired.

#3: Amplify the employee voice

Remind employees early on that they have a voice to share about company culture and employee benefits. Glassdoor, for example, recommends employers invite new hires to reflect on their first few months at the company. Whether this leads to internal feedback or a public review, it can assist efforts aimed at creating a positive employer brand.

L’Oréal recently launched a #LifeatLoreal hashtag to encourage employees to share photos of their experiences at work. The campaign all stemmed from the idea that people would trust their peers on social media when it came to L'Oréal being a great place to work. Employees posted a wide variety of pictures, including snapshots of various benefits and perks in action—such as flex days and catered lunches. Encourage employees to share the experiences they enjoy the most on the social channel of their choice.

#4: Keep employees engaged with benefits

On average, salary is only about 70% of an employee’s total compensation. When employees don’t take advantage of the benefits offered by the company, it’s equivalent to leaving 30% of the total compensation package on the table. Employers who keep employees engaged with benefits are more likely to see benefits manifest as part of the employer brand. An employee is highly unlikely to leave a Glassdoor review that mentions a positive benefit if she has never actually utilized the benefit.

Try hosting monthly or quarterly Q&A sessions to discuss available benefits. When you roll out a particularly hefty benefit, such as a new 401K offering, or an update to parental leave policy, give employees ample opportunity to ask questions. You could also share success stories from employees who have taken advantage of a particularly niche benefit, such as an hour of free lawyer services, to showcase how the benefit is used and encourage other employees to check it out.

#5: Benefits are the forgotten negotiation tool

If you are a hiring manager or recruiter engaging with a candidate, think beyond salary, or equity. Everything is negotiable, from vacation days to health insurance choices. Savvy employees, especially as the war for talent continues to heat up, will use benefits as negotiation tools—but don’t shy away from doing the same thing on the employer side. It’s often easier to offer more benefits than to secure additional salary for an employee.

Don’t be afraid to talk about your full complement of benefits, including your severance benefits. Prospective employees may feel more comfortable about joining a company that will take care of them, in the event of a downsizing or restructuring event. You may want to consider offering perks like outplacement and career transition services to employees who leave voluntarily as well as those who are involuntary subjects of a layoff. Knowing that you are invested in their career, even after they leave, will help you create a workforce of dedicated, engaged, and satisfied employees.

The world is small and everyone is connected. When you invest in employees, it leads to a positive employer brand. In the new Employee Relationship Economy, former employees will someday become vendors, customers, brand evangelists, recruiting references, or even boomerang employees. In a world where the employee/employer relationship is no longer finite, it’s important to convey your full support for employees’ career endeavors at every stage of their career journeys -- beginning early in the recruiting and interview process.

In every recruiting conversation, highlight your dedication to each employee’s career. When you frame up your organization’s benefits in context of how they fit in with the employee’s journey, it’s easy for the candidate to see how your company would support his journey. Communication about employee benefits can go a long way in the recruiting process—and will have a direct impact on your employer brand. If you offer much more than “industry standard,” you should be screaming it from the rooftops. Your current and prospective employees deserve to understand just how committed you are to their personal and professional journey.

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