Return of the War for Talent

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Return of the War for Talent

Research on recruitment and job-hunting in 2010–2011Results, trends and recommendations


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Contents1. The War for Talent is back on

Recruitment on the rise

Good candidates are becoming scarcer

Winning the War for Talent

2. Nurturing in-house talent

Limiting the outflow of experience

Retention activities to start on day one

3. Clarity in the recruitment message

Tuning the message to the target audience

4. Communication during the recruitment process — a tactical weapon

Every touch point is an opportunity to enhance employer brand

Negative effects of a lack of communication

5. Optimising the recruitment budget with the best performing channels

Performance of recruitment channels

An alternative source: spontaneous applications

6. Ten tips for winning the War for Talent

IntroductionStepStone has conducted research into how companies and job seekers are dealing with the search for employees and jobs in 2010–2011, in a climate that has changed quite considerably since the economic crisis of 2008–2009.

The research was carried out in eight European countries simultaneously during September 2010.

The results of this survey of companies and job seekers offer useful insights into how to optimise recruitment processes. This report generally shows the results at a European level — across the eight countries where the survey took place. Any marked differences between countries are noted in the text.

At the end of the document you‘ll find some practical tips and recommendations to help you win the War for Talent.

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Executive summaryThis survey is the follow-up to the StepStone recruitment survey undertaken in 2009. It documents general trends within the recruitment market and gauges the application and recruitment practices of job seekers and employers respectively.

During the 2008–2009 crisis, there was an increase in the unemployment rate and a decline in vacancies. Over the past few months, however, there has been a noticeable increase in vacancies, re-igniting the war for talent. Had it ever really died down, or has the gap for specific profiles always been present? In any event, the StepStone survey reveals that the War for Talent is well and truly back on.

Back to battle The StepStone survey shows that organisations are experiencing increased recruitment needs just as good candidates are becoming scarcer. High demand from recruiters, combined with the low inflow of top candidates, means the War for Talent has flared back up. In this climate organisations need to capitalise on their employer brand, securing current and future employees by communicating well and providing compelling reasons for why people should choose to work for them.

Nurturing in-house talentWith the high level of recruitment demand, organisations need to make sure they limit unplanned departures as their top employees become targets for other employers. This survey reveals which issues drive employees away — such as limited development opportunities and lack of appreciation for their work. It also gives pointers about which aspects enhance employees’ loyalty to their current employer — including high levels of job satisfaction and well-being at work.

Clarity in recruitment messagesReeling in new employees is easier with clear recruitment communications that result in a higher and more qualitative response rate from job seekers. StepStone researched which job aspects are most important to job seekers in order to help organisations tune the content of their recruitment messages to the candidates they want. Job scope and responsibilities are at the top of the list; company values and the working environment are also high on job seekers‘ agendas.

Using recruitment communication to enhance the employer brand Every touch point with (future) employees is an opportunity to enhance your employer brand. Communication during the application process is an easy win in that respect. The StepStone survey shows that a lack of communication results in a negative perception of the employer band, and can even have a negative impact on consumer behaviour towards a non-communicating organisation’s products.

Selecting the best performing recruitment channelsIn a challenging recruitment market, companies will focus on the channels that deliver the highest numbers of quality applicants at the most favourable ROI. To optimise recruitment results, it’s vital to know where job seekers are looking for jobs and to send out recruitment messages via the best performing recruitment channels. Job boards are at the top of the list of job seekers‘ preferred channels and are also the best performing channel according to recruiters.

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About the research

StepStone carried out an online survey among 7,953 job seekers and 1,642 organisations in eight European countries: Austria, Belgium, Denmark, France, Germany, the Netherlands, Norway and Sweden. The organisations were from all sectors and included large as well as small companies. The job seeker audience included the unemployed as well as those in work seeking a new challenge. They were selected from the StepStone database.

The research focused on the job hunting and application behaviour of job seekers on the one hand, and on the employee search and recruitment processes used by recruiting organisations on the other. Questions covered the channels used for finding a job or applicants; the volume, content and quality of applications; the methodology; and the follow-up. Communication during the recruitment process was also taken into account.

This research is part of a recruitment survey programme. It’s the follow-up to the surveys that were conducted during September–October 2009.

7,953 job seekers and 1,642 organisations in 8 European countries took part in the online StepStone survey

9595

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1. The War for Talent is back on

Recruitment on the rise

Optimism around recruitment has increased compared to 2009. Of the employers surveyed, 55% plan to increase headcount during 2010–2011, and 43% plan to begin recruiting within the next three months.

Germany and Sweden present an even more positive outlook as 66% of German employers and 68% of Swedish employers expect an increase in staff numbers (54.6% in Europe overall).On the other hand, Danish employers foresee a less intense growth: 56% expect to maintain the status quo in terms of staff numbers and only 33% expect an increase.

This is also reflected in the recruitment outlook, where only 61% of Danish organisations are looking to recruit over the coming year (Europe: 78%). Austrian employers also foresee recruitment in only 66% of cases.

Recruitment may be initiated for newly created positions or to replace departing employees.

Despite the slower pace of recruitment for new employees in Austria and Denmark, relatively higher recruitment efforts in these countries are aimed at replacements (22% in Austria, 31% in Denmark) than in Europe generally (17%).

The search for new employees is increasing for all profiles, with the majority of effort focused on sales and marketing professionals, engineers and technical specialists, and administration and IT professionals.

Figure 1 – planned change in headcount Figure 2 - recruitment intentions 2010-2011

Among employers, 32% state that it takes over two months to source a new employee.

Swedish employers are an exception to this trend, with 45% taking more than two months to hire. In the Netherlands, the number of employers with a hiring time of over two months is only 19%. And only 11% of Norwegian employers need more than two months to source a new employee.

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next 3 months43%don‘t

know8%

no plans15%

next 12months24% next 6 months

10%

14,5%

6,3%

50,8%

39%34,7%

54,6%

Decrease Same staff number Increase

2009-2010 2010-2011


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Good candidates are becoming scarcer

On the supply side of the recruitment market, organisations are noticing a widening gap. Whereas up to 37% of employers are experiencing insufficient numbers of applications for vacancies, 35% of employers expect that the same average number of applicants will be maintained going forward; 22% even expect to see a decrease in the number of applicants for their job openings.

Denmark and Norway show a different trend: the majority of employers are happy with the number of applicants (Denmark: 86%; Norway: 82%) and don’t have the problem of too few applicants.

In France and Sweden, on the other hand, a relatively large number of employers experience an excess of applicants compared to other European countries (12% in France, 14% in Sweden, 8% in Europe overall).

Figure 3 - average applications

per job

Figure 4 - application quantity Figure 5 - expected evolution of

application quantity

Moreover, the quality of applicants has gone down, according to 42% of European employers.

The quality decrease in Norway and Sweden is less marked (30% and 28% respectively) than at the European level. However, the trend in Denmark is quite the opposite: two-thirds of Danish employers state that the quality of applicants has stayed the same (33%) or even increased (37%).

The most frequent problem is the number of underqualified applicants responding to a job opening, that equals or even exceeds the number of matching candidates. Overqualified candidates are a rare phenomenon.

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1-45-1920-4950-99100-199200-299+300

9%

41%33%

14% 3%too high

8%

rightquantity

55%

too low37%

no idea19%

increase24%

decrease22%

same level35%


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Winning the War for Talent

The combination of high demand for candidates in the face of a decreasing supply has re-ignited the War for Talent.

In this recruitment climate, organisations need to excel in terms of their employer brand: it‘s about securing current and future employees through communication and delivery of compelling reasons why people should work for you. To reach and retain the right people, employers need to use smart recruitment techniques in a consistent way and with an eye on the long term.

We have amalgamated the rest of the survey results into four principles designed to help you win the War for Talent. The following sections reveal the trends in those four areas and offer suggestions on how you can turn them to your advantage.

Figure 6 - tactics to win War for Talent

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Nurturingin-house talent

Clarity inrecruitment

message

Communicationduring

recruitmentprocess

Recruitmentchannels


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2. Nurturing in-house talent

Limiting the outflow of experience

Experienced employees are a prime target for other employers as the War for Talent hots up. As talent is key to an organisation’s performance, it’s important to nurture the talented individuals within the organisation and keep them on board.

Reasons to leave a job

37% - no career opportunities15% - no appreciaton15% - lacking responsibilities13% - financial package

Top reasons to stay

63% - an interesting job55% - good relationship with colleagues45% - a healthy work/life balance42% - a good relationship with supervisor

Figure 7 - reasons to leave or stay in current job

For 37% of employees, lack of career development opportunities within a company is the main reason for wanting to leave their job. Working with high-potential employees to set up a career development path can counteract this outflow of experience.

It‘s worth monitoring other pressure points with employees or their managers on a timely basis. Lack of appreciation and insufficient responsibility can be sore points for employees. Surprisingly, complaints about financial rewards are only fourth on the list of reasons for leaving a job (17%). In Norway, however, up to 25% of job seekers state that lack of remuneration is one of the reasons they would leave their job.

Job scope and well-being at work are therefore extremely important to an organisation’s retention policy, so it‘s worth paying close attention to both.

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Retention activities to start on day one

Figure 8 - search behaviour after starting a new job

A retention programme should start on day one for each employee — or even sooner. That‘s because up to two-thirds of newly hired employees are still on the lookout for other vacancies. This number is seriously underestimated by employers, of whom only 46% said they were aware of the situation.

Designing a thoughtful induction programme can reduce new employee turnover at the same time as rapidly preparing people for their new jobs. This type of programme will give people the practical information they need on joining, as well as help to confirm that their decision to work for your organisation is the right one.

You can even start the induction program for new employees before their first day at the office. An informal meeting with future colleagues, an email with a countdown to their start date and some tips for day one (dress code, start time, lunch ideas) — these are some of the small things that can reduce anxiety and make a new employee feel welcome.

3. Clarity in the recruitment message

Tuning the message to the target audience

Setting up clear recruitment communications will improve the response rate to your job vacancies — not just the quantity but also the quality. Your aim is to get the right job seekers to apply, not simply as many as possible. That’s where the content of the job ad comes in: giving the relevant information that lets job seekers easily work out whether they are qualified for the job.

When defining your recruitment message, keep in mind that job seekers attach greater importance to certain aspects. The job‘s scope and responsibilities head the list, followed by the financial package. Job security is still an issue in the post-recession era. The working environment and company culture follow closely.At a country level, the differences are minor. Only in France do job seekers reveal a more marked interest in career opportunities.

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stop searching33%

activejob search

11%

passive job search56%


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Figure 9 - job aspects according to job seekers

On the employer side, the StepStone survey reveals that the way for recruiters to meet job seekers’ information needs is by clearly defining the scope of the job when creating their recruitment message. After job scope, it‘s brand image, the working environment and company values that are the most important aspects of the recruitment message.

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job scopediversity of the job

salaryjob security

attractive work locationadditional responsibilities

company values/culturecareer opportunities

time to commuteflexible working hours

trainingcompany image/brand

additional benefitscompany size/stability

family friendly employerpossibility to travel

Figure 10 - highlighted aspects in job advertisement

job scope

diversity of the job

the company‘s image and brand

attractive environment / location

company values/culture

additional responsibilities

career opportunities within company

training

the company‘s size/stability

flexible working hours

additional benefits

job security

opportunities for travel/working abroad

salary

family friendly employer

89,0%

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45,6%

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38,6%

28,3%

28,1%

25,8%

22,1%

16,1%

15,5%

14,1%

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important unimportant


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Job information requested by job

seekers

job scopejob responsibilitiesfinancial packagejob security

Job information provided byrecruiters

job scopeimage & brandworking locationcompany culture

Figure 11 - job information according to job seekers and recruiters

4. Communication during the recruitment process — a tactical weapon

Every touch point is an opportunity to enhance employer brand

Every occasion on which an organisation has contact with the outside world and with its (future) employees is a potential touch point that can be used to enhance the employer brand.

Employers would do well to analyse the various opportunitiesto optimise communication of the employer brand. In this report we focus on the recruitment ad and communications during the application process.

The job advertisement is only the starting point. Following up with job seekers during the recruitment process and communicating on progress is an easy win in terms of employer communication, bolstering the perception of the employer brand.

A quick follow-through of the applicant’s file and communication is much appreciated — 79% of applicants expect to hear back within one to two weeks of their initial application. An acknowledgement of application receipt is easy to set up. Employers score quite well on this aspect, with only 22% taking longer than a week to respond to applications.

Most employers also send a communication to applicants who don‘t make it to the next round; however 37% of job seekers state that they typically don’t hear anything at all after applying.

of applicants expect news within 1 to 2 weeks

79%

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Negative effects of a lack of communication

Even a rejection message, if appropriately expressed, can have a positive effect on a company‘s employer brand — whereas the impact of not communicating at all can be devastating.

The survey gives clear evidence of this impact: 87% of applicants have a negative or very negative perception in cases of non-communication, and 49% would not re-apply to the same organisation.

Lack of communication not only affects the perception of the employer brand, but can also influence the consumption behaviour of applicants, who may well be customers of the organisation. Among job seekers who don‘t receive any communication, 66% say they would change their buying behaviour towards the organisation‘s products.

Figure 12 – effect of lacking communication during the application process

It pays to audit your recruitment communication process. The starting point is a clear job advertisement, followed by prompt and regular communication after an application has been received, including acknowledgement of receipt and, more importantly, timely communication on whether the application is or isn‘t moving on to the next stage.

Effect on employer brand Effect on applicationbehaviour

Effect on company‘sproducts/services

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very negative effectprobably negative effectprobably no effectno effect at all

23%27%

would apply againwould not apply again

51%49%

13%

very negativeprobably negativeprobably no neutral

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5. Optimising the recruitment budget with the best performing channels

Performance of recruitment channels

Rather surprisingly, only 66% of employers track the efficiency of the various media they activate during their recruitment campaigns, despite the fact that proper tracking is the first step to optimising the recruitment budget.

Job seekers often fail to mention the source that has prompted their application, or give the wrong source. So employers need to rely on other methods to assess the performance of recruitment media, such as statistics from job boards.

Applicants and employers coincide when it comes to deciding which channels to use. The channels most used by applicants are also those that perform best according to the employers we surveyed.

The search behaviour of job seekers and employers is quite similar, with job boards being the top recruitment channel — 97% of job seeker respondents and 82% of employers use this channel.

There was very little divergence in the behaviour of job seekers in each country and across Europe as a whole. On the next page are the top three channels used by job seekers in each country.

* Examples of local public institutions : Bundesagentur für Arbeit, Arbeitsmarktservice, Pôle Emploi, APEC, VDAB, Forem, Arbetsförmedlingen

Figure 13 - Recruitment channels

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job board

own website

search engines

own network

recruitment agencies

public institution

interim agencies

social networks

local newspapers

dailies / job magazines

job fairs

*

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81,2%

79,8%

48,7%

50,6%

38,2%

35,4%

40,1%

30,5%

26,9%

Best performer according to recruiters Used by candidates


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Austria

- 96% job boards- 73% search engines- 67% local newspapers

Belgium

- 98% job boards- 72% public institution- 67% temp agencies

Denmark

- 91% job boards- 84% search engines- 83% networking

France

- 97% job boards- 87% public institution- 73% temp agencies

Germany

- 97% job boards- 76% search engines- 75% local news papers

Netherlands

- 99% job boards- 79% search engines- 78% networking

Norway

- 91% job boards- 72% search engines- 66% recruitment agencies

Sweden

- 90% job boards- 78% public institution- 75% networking

Figure 14 - top 3 recruitment channels per country

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Channels mostly used by job seekers

1. Job boards2. Search engines3. Own network4. Recruitment agencies5. Public institution

Figure 15 - top 5 recruitment channels according to European job seekers and employers

Top performingchannels for employers

1. Job boards2. Own website3. Own staff or network4. Public insitution5. Recruitment agencies

Among job seekers 50% search and apply for jobs during working hours. Online tools enable them to be discreet. When searching for jobs, 61% of job seekers apply directly; 67% prefer to apply by email — another preference that coincides with employers’ preferences.

That’s why online media are very popular: they’re the best suited to the needs of today‘s applicants.

An alternative source: spontaneous applications

Quite a number of applicants don’t wait for an organisation to advertise a job opening. They apply spontaneously, advertising the skills they could bring to a company. Our survey shows that 64% of applicants have made a spontaneous application at least once, and 44% of those were invited to interview.

Job seekers are more likely to apply spontaneously in Denmark (84%) and France (78%). On the other hand, Dutch, Norwegian and Swedish job seekers are less active when it comes to spontaneous applications (54%, 50% and 54% respectively).

Not reacting to spontaneous applications could mean an organisation misses out on a great opportunity to nurture an interested, would-be employee — not to mention the negative impact it could have on the organisation‘s employer brand.

We recommend that employers should, as a minimum, acknowledge receipt of spontaneous applications. Ideally they would keep the CVs of spontaneous applicants in an archive so that recruiters can review them first when an opening arises.

of employers invite all spontaneous applicants with an interesting profile, even without a vacancy

79%of employers invite spontaneous applicants only when their profile matches a job opening

37%of employers insert the spontaneous CVs in a database for future reference

25%

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6. Ten tips for winning the War for Talent

1. Retaining top quality and key employees is a great employment challenge. We suggest you nurture your current employees to avoid unplanned departures. Well-being and job satisfaction are far more important to employee retention than pay or benefits; while the absence of a development path and lack of recognition for work done are top reasons for leaving. Setting up a clear development path will give your employees a long-term view of their time at your company. It‘s also worth monitoring pressure points regularly.

2. Capitalise on spontaneous applicants: simply by applying, they’ve shown interest in your organisation

and will be more easily motivated to come for interview when a vacancy opens up. 3. When creating a job advertisement, bear in mind the types of information applicants are looking for.

Job scope is their main concern, followed by the financial package, the job security, and the working environment.

4. Tracking the efficiency of the recruitment channels you use will give you insight into what works best

for your company. The ability to calculate ROI will allow you to optimise your recruitment budget.

5. You may want to be careful in choosing the channel to reach out to applicants. The recruitment channel most used by job seekers is job boards; it is also the best performing recruitment channel according to employers, as this survey clearly shows.

6. Standardising the recruitment process can reduce your workload. An online application form allows you to quickly scan applicants‘ details. Tools are available that enable initial screening based on a set of criteria, and despatch of an automated response to applicants who don’t match the desired profile. We found that 89% of job seekers are prepared to fill in an application form.

7. Streamlining your communication flow during the recruitment process is a perfect way of enhancing

your employer brand, even when you‘re sending a rejection message. As our survey confirms, failing to communicate with applicants will have a negative effect on their perception of your company.

8. Job seekers are motivated to make time to search for the ideal job, but time is both precious and in short supply. Applicants appreciate it if the recruitment process is limited to a maximum of two or three interviews.

9. Don’t be afraid to test applicants — 88% of job seekers are prepared to take a test to increase their chances of a job. However, you should check whether local legislation allows testing in the country where you’re recruiting.

10. Even after signing an employment contract, 67% of new hires will continue looking for another job. A thoughtful induction programme for new employees can reduce turnover and save an organisation thousands of euros. Your induction programme should be designed to provide a welcome, develop a positive perception of your company, confirm the new employee‘s decision to join your company, and set the stage for training.

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Table of figures

Figure 1 – planned change in headcountFigure 2 - recruitment intentions 2010-2011Figure 3 - average applications per jobFigure 4 - application quantityFigure 5 - expected evolution of application quantityFigure 6 - tactics to win War for TalentFigure 7 - reasons to leave or stay in current jobFigure 8 - search behaviour after starting a new jobFigure 9 - job aspects according to job seekersFigure 10 - highlighted aspects in job advertisementFigure 11 - job information according to job seekers and recruitersFigure 12 – effect of lacking communication during the application processFigure 13 - Recruitment channelsFigure 14 - top 3 recruitment channels per countryFigure 15 - top 5 recruitment channels according to European job seekers and employers

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About StepStoneFounded in 1996, StepStone is one of the most successful online job board businesses in Europe today. With over 7 million visits and more than 80.000 jobs per month, StepStone operates some of the strongest online job portals in the European market. Everything StepStone does, pursues one main objective: to accurately match the best candidates with the best companies. StepStone employs around 400 people in eleven countries, aiming to deliver the highest quality of service to all of its clients, ranging from small local players to big global cooperates throughout all industry sectors. More than 16.000 renowned companies, for example Deutsche Telekom, Siemens, Deloitte and Daimler, use StepStone successfully in eleven European countries for the recruitment of qualified specialists and executive staff. Beyond the StepStone websites the international StepStone “Network” also allows customers to find new employees in more than one hundred countries. StepStone is a wholly-owned subsidiary of Berlin-based Axel Springer AG.

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Return of the War for Talent