HR managers in India as well as in most developed economies are facing what appears to be a shortage of skilled and trained people. The factors behind such shortage – real or imaginery – are of course, different for different economies. In India, the tremendous growth of certain service sectors such as information technology and IT enabled services, retail, banking and finance and real estate, to name some of the more important ones, together with near double-digit growth in the manufacturing sector, are leading to shortages in trained and skilled manpower. Elsewhere, demographic factors such as too many baby boomers leaving the workforce all at one go and populations skewed towards the elderly are probably more to blame. In any case, it has today become very important for HR managers, to operate successfully in a tight labor market. This article looks at how HR managers can go about finding Mr Right when faced with a shortage of talent.
While shortage of skilled and trained manpower is forcing companies to spend more resources on recruiting employees, redesigning jobs and compensation plans to attract a wider range of candidates and investing greater time and energy on employee retention, one mistake that recruiters can make in a tight manpower market is that they can succumb to pressures to lower their requirements while hiring.
Of course, in economies such as India where more than 30 lakh graduates and 4 lakh engineers pass out each year, there is the opposite danger of hiring overqualified people – something that some BPO units did in the early days of the BPO boom with the result that they soon had on their hands many disgruntled employees who quit at the earliest opportunity and added to their attrition woes.
The point is, therefore, that hiring requirements should be just right so that HR managers always end up hiring the right people for the right job at the right time. Hence, how do we make sure that in a tight market when there are pressures to lower the bar when making hiring decisions, we still end up hiring the right people for the right job.
Usually, in a market where there is an abundance of high quality people, the tendency is to lay down fairly high educational and experience requirements. This automatically reduces the number of applicants and still leaves a large enough pool of potential candidates to choose from.
In a tight market, as companies find fewer and fewer candidates applying for any job, they are forced to lower the requirements to fill up posts that cannot be left vacant. Candidates who would have been disqualified in an easier market, now get considered as potential recruits. And the longer companies take to fill up vacancies the more desperate they become to lower standards and somehow fill up vacancies – their focus shifts from hiring the best to simply finding someone who meets the minimum job requirements.
In a tight market all this cannot be entirely avoided but the real danger is that HR managers often end up lowering the bar to such an extent that it creates an unreasonable and unnecessary risk to the organization. And, hiring mistakes turn out to be costlier in a tight market. First, hiring costs are higher in a tight market as more resources have to be spent to source candidates. Recruiting the wrong guy then means attrition or dismissal or yet another round of costly hiring to fill up the same position.
Next, recruiting the wrong guy also means not hiring other, more qualified candidates. Good candidates exist in a tight market, its just that finding them is tougher. And competitors are unsparing. If you miss out on the right candidate, chances are that your competition won’t.
The key issue, therefore, is how do you relax job requirements and still manage to hire Mr Right? The problem usually is: when you lower standards in a bid to increase the number of applicants, you also increase the risk of letting in the wrong candidates. HR managers have to, therefore, strike a fine balance between the need to increase applicant flow and the risk of hiring Mr Wrong.
To do this, HR managers need to review their requirements with regard to four key elements. These are:
* Minimum job requirements.
* The educational and experience criteria for meeting the job requirements.
* The potential of candidates to grow and meet future requirements.
* Whether the job meets the candidates’ work goals.
Revisit each of these areas and ask challenging questions. Does the job really require all these skills, characteristics and certifications? Do candidates have to be so qualified and experienced to meet the now critically determined job requirements? Is experience and educational qualifications such a sure guide to potential? Does the job really meet the work goals of potential candidates since in a tight market candidates will seek more than mere pay packets?
More often than not, a critical examination of all these issues will show that standards can be lowered and a larger pool of applicants can be obtained without really making any significant compromises on what is really required.
A tight job market only requires HR managers to tighten their own thinking so that they can launch a more focused search for Mr Right. He is out there alright, it is just that you have to make sure that you know exactly who you are looking for.
A tight market just does not allow any slack between your search criteria and the characteristics of Mr Right. In short, just get your search right for Mr Right!