A war for talent or for dead wood?

Mar 09 2010 by Nic Paton Print This Article

The good news is the global economy is improving. The bad news is what this could mean staff retention, with two thirds of executives and more than four fifths of line managers believing their teams are disengaged from their work and would be more than happy to leave Ė if only they had another job to go to.

Last week recruitment firm Adecco warned firms to brace themselves for a new war for talent in the coming months.

Now the respected Economist Intelligence Unit think-tank has concluded that firms risk suffering deep talent erosion and long-term underperformance from those that are left, as the inevitable cut-backs and redundancies seen during the recession have undermined trust in the workplace.

Combined with increasing demand for executive talent and a sharp drop in graduate recruitment, the poll of global managers found companies without the right talent strategies at risk of developing a major skills shortage just their employees' energy and commitment was needed the most.

Nearly a third of the 400 business executives surveyed, in the poll for recruitment firm StepStone, said employee engagement in their organization was low and that they expected to lose key people as demand for talent grew. Four out of 10 added they already have a shortage of talent in their organization.

Worryingly, while just 16 per cent of line managers felt their staff were fully engaged with the business, when the same question was put to chief executives, the answer was 38 per cent, suggesting a disconnect between what senior managers think is happening within their organizations and what is really happening on the ground.

The Companies at the Crossroads report found that the availability of talent was rising rapidly up the management agenda, and was now third overall as a driver of growth (voiced by 46 per cent of respondents) and sitting behind only economic recovery and credit availability.

Some 44 per cent agreed they were finding it increasingly difficult to recruit talented employees.

One in two planned to increase recruitment over the coming year, while barely a fifth planned to reduce or freeze headcounts.

Matthew Parker, group managing director at StepStone Solutions, said: "Right now, businesses are at a crossroads when it comes to their talent. They can either take steps to create, maintain and develop global talent pools, or ignore the warning signs from this survey and suffer a gradual talent erosion at all levels that will inevitably lead to underperformance.

"It is particularly worrying to see low trust among middle-level employees going hand in hand with low graduate recruitment and an ongoing demand for senior executive talent," he added.

"Left unaddressed these problems constitute a perfect storm for businesses, as the most capable employees head for the exit and fresh talent is not recruited. These trends have serious, long-term implications for any business in a recovering economy and they require urgent attention."