Breaking the myths surrounding a hiring freeze
In today’s world, the turmoil of uncertainty can leave many reeling with the unknown and unexpected. According to Bloomberg, there have been more than 94,000 job cuts across the tech sector in 2022.
As organisations strategize for the upcoming year, the focus in Europe is on how to keep their current workforces happy while attracting the best people to join them. Some talent leaders have decided to implement a hiring freeze and pause all new talent acquisition activities.
Some common misconceptions about hiring freezes are that they only happen during complex macroeconomic conditions, leaving teams overwhelmed with the additional workload and managers grappling with how to forge a path forward. But when organisations implement a hiring freeze, they have an opportunity to focus on employee development and invest in their people. A pause on filling open positions can be a strategic part of an organization’s plan to recenter and refocus on company goals.
The current talent landscape in Europe is very destabilised due to many factors:
- The ongoing war in Europe
- Rising inflation
- High churn rates
- Economic slowdown
- Increase of people retiring
Our Global VP of Strategic Initiatives Mike Bollinger partnered with Lighthouse Research & Advisory’s Chief Research Officer Ben Eubanks to discuss antidotes for hiring freezes on a recent SHRM webinar. The pair also covered groundbreaking findings from the recent research study, “Ready set, grow: The building blocks for high-impact talent mobility.”
Mike Bollinger, Global VP of Strategic Initiatives, Cornerstone, takes a closer look at the findings from the 2023 Talent Mobility Study, released by the Cornerstone People Research Lab and Lighthouse Research & Advisory.
Navigating the uncertainty of a slower economy in 2023
The year 2023 is already beginning with organisations being more cautious about hiring, yet this does not have to hinder their ability to innovate and grow. When companies develop a growth mindset by investing in their people, it strengthens employee engagement and boosts business performance. Organisations now have an opportunity to become future-ready with their current workforce within the current teams led by talent leaders.
The European workforce is experiencing a troublesome paradox: high job vacancy rates coupled with a skills gap. It's becoming increasingly clear that lack of career development and advancement is a major contributor to this dilemma. It’s important for organisations to rethink their approach to providing opportunities and resources to grow and advance in their careers.
Talent mobility is critical. HR leaders must understand their employees' expectations around career and skill development. The report found that companies with better revenue, employee retention and employee engagement are 65% more likely to have technology that offers career visibility.
In EMEA, managers certainly play a crucial role in employee growth, many workers prefer to explore career opportunities through technology first, rather than through conversations with their managers. When managers encourage talent development with online classes, self-directed learning and certifications, employees are likely to have higher, more positive perceptions of belonging.
Redefining success: The value of investing in your people
People within an organisation matter. When talent transitions in large numbers, the impact can negatively affect the organisation. These employees have skills, talents and attributes that support a future-ready workforce. And when people transition out of an organization, it creates skills gaps in abilities and strengths many companies didn’t know they needed.
The research study surveyed 1,060 employers and 1,000 employees in Europe, North America and Asia and the results ultimately revealed the demand for internal career opportunities. Regarding revenue and engagement, high-performing organizations were more apt to focus on talent mobility. The study showed that 47% of employees would feel more satisfied if they could explore different career opportunities. Yet one in five employees feels they don’t have career visibility. This absence of information can trigger a lack of engagement.
The research found that workers who do not have visibility into internal career growth opportunities are 61% more likely to quit or find alternative positions at other companies. Bollinger shared that after surveying 1,000 employees, talent who do not see the potential for advancement and internal opportunities are three times more likely to be uninterested in other internal positions within the company. Fifty-one percent of employees in EMEA say that the best way their company can support their skill development is by giving them opportunities to stretch and grow.
“What’s interesting to me,” said Eubanks, “is that half of the workers we surveyed agreed that a chance to explore employee development opportunities would make them feel happier and supported in their careers long term.”
So, how can organisations drive internal talent mobility and grow their people from within? Below are the strategies organisations can use to reskill their talent, keep them engaged and ensure their upward trajectory aligns with their organisation’s needs.
The power of personalised growth
When considering talent mobility, the first strategy is personalising your organisation’s career growth approach. Personalisation means understanding the people on your team and creating innovative ways they can utilise technology to explore the skills and career development they desire.
Beyond the manager-centric element to career mobility in EMEA, formal organisational processes also scored very highly. This combination is important because they go together. Strong communication and structure help to set expectations for workers and their leaders, giving them freedom to focus on job opportunities.
Bollinger highlighted how an opportunity marketplace, when looking at skills and matching talent to organisations' needs, can help to motivate employees during their career journey. By focussing on flexible career paths — not just traditional career ladders — through an opportunity marketplace, organisations can retain talent during hiring freezes and still support the company's overall goals. A self-developing workforce puts people in the driver’s seat of their own career opportunities.
Leveraging technology in career mobility
HR technology has amazing impacts on talent mobility. Eubanks shared that 80% of employees prefer self-service technology to initially explore career opportunities, more so than speaking with a manager. Thirty three percent of organisations in EMEA say their people have visibility into career opportunities through some kind of technology.
Providing employees with the tools to explore career paths that match their skills and interests during a hiring freeze can significantly impact employee engagement. And employees that work for a company that has access to self-service technology for career mobility technology are 50% less likely to quit their job compared to those with no visibility.
When managers are career enablers that invest in their people with innovative HR technology, employees feel supported, engaged and ready to perform to the best of their abilities.
Unlocking employee potential through effective manager support
Workers in the talent mobility study were scored on their perceptions of belonging, revealing some stark differences in people with high and low scores. The data showed that high-belonging employees were 190% more likely to say their manager would support their career growth. On the other hand, low-performing organisations are 50% more likely to say that managers hold onto their people too tightly from a career advancement perspective.
Managers who encourage their employees to explore career development opportunities openly are much more likely to have employees who are willing to stick around. Employees who scored low in the survey are six times more likely to say they don’t know if their manager or employer tracks their skill development. Fifty percent of frontline employees in EMEA say that a supportive manager who provides career guidance and growth opportunities could turn around an unsatisfactory work situation.
Managers play a pivotal role in putting learning technology into practice, creating skills that match interests and investing in necessary career conversations.
Building a strong team by creating cohesion in the workplace
Visibility is vital during a hiring freeze so that employees know what opportunities are available, and organisations can support their people’s talent development. For employee retention rates and career development to blossom, organisations need to consider a company-wide shift in how talent mobility is managed.
There are a variety of ways that employers can support employee career mobility. The top two responses from business leaders in EMEA focus on personalised learning and visibility into opportunities, but there’s another interesting set of callouts as well. For instance, there are two areas that learning leaders think are quite effective at supporting mobility, but they aren’t yet using them as often as they should:
- Formal processes like shadowing and stretch assignments
- A skills dashboard that highlights skills and skill gaps between current and future roles
Leveraging these two options can help to shift the responsibility for career mobility from managers to the workforce, allowing workers to have a greater say in what opportunities they want to pursue.
HR leaders have an opportunity to create transparent and accessible career exploration opportunities to enhance employee learning, growth, and retention in this ever-evolving economic climate.
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