Shift from retention to attraction as Asia Pacific labour market heats up

Shift from retention to attraction as Asia Pacific labour market heats up
Thursday April 03, 2008

Sydney 3 April 2008: Employers are in for another tough year ahead, with the battle to attract talent voted the biggest human capital challenge by Asia Pacific employers, according to a new report by specialist recruitment network Vedior Asia Pacific.

The 2008 Vedior Asia Pacific Employment Trends Survey, released today, reveals attracting talent is a struggle for more than two-thirds (69 per cent) of organisations. While retention was the key issue in 2007 for Asia Pacific based organisations, attracting talent is cited as the biggest human capital challenge over the next 18 months for 26 per cent of Asia Pacific based organisations, with retaining talent a close second at 24 per cent.

And competition for talent is set to intensify further in 2008, with 42 per cent of Asia Pacific based employers looking to expand their current workforce in 2008, a significant increase from 28 per cent in 2007.

Debbie Loveridge, Chief Executive Officer of specialist recruitment network Vedior Asia Pacific, says “The shift from retention to attraction reflects the overall climate of the continued shortages in skilled labour and the need to consider strategies to penetrate a relatively dense 'passive' candidate market.

"The laws of attraction in recruitment are being rewritten by candidates who make decisions about a potential employer based on both an emotional and a rational level. With the power firmly in the candidate's hands, it is up to the employer to differentiate their employment value proposition and clearly define what it is that makes a career with them unique.

"With the realisation that the shortage of labour is having a real impact on the bottomline, employer branding is likely to be put on the agenda of every boardroom table in the region," says Ms Loveridge.

Sixty-three per cent of Asia Pacific based organisations believe their employer brand attracts and retains employees, however, 60 per cent admit there is still more that can be done to improve their employer branding strategy.

One area Ms Loveridge suggests employers could focus more attention on to attract the right talent is online and digital media. Only 6 per cent of organisations are using online social networks, such as Facebook and MySpace, as a way to source and attract talent.

"Employers might want to consider incorporating online networking into their long-term recruitment strategy. Online is a great opportunity to target different demographics and diverse talent pools – so in the midst of such a shortage, it is a much underutilised tool in the region," says Ms Loveridge.

Once reserved for senior executives, one in five organisations (20 per cent) now use headhunting to source junior talent and 58 per cent use headhunting to source mid-level professionals and managers. A symptom of the chronic talent shortage, headhunting now follows online and print advertising as the third most common sourcing method used by 42 per cent of Asia Pacific organisations.

As the pressure to attract talent intensifies, the survey shows that many organisations continue to be forced to look offshore. Whilst the UK continues to dominate the supply of international talent (58 per cent), India (22 per cent) and China (15 per cent) are becoming an increasingly attractive source of candidates for the region.

"Employing overseas was once a matter of being humanitarian. Today, it is a matter of necessity as employers have no choice but to search much further a field and much more aggressively than ever before. Capitalising on the growth of human resources offered by China and India will be a key opportunity for organisations in the future," added Ms Loveridge.

Overall, the difficulty in filling headcount is having a very real and adverse effect on organisations. Organisations are feeling these effects through increased workload and stress amongst staff (61 per cent), increased staff turnover (38 per cent) and a decrease in overall company performance (25 per cent). The industries finding it hardest to attract talent are the education (76 per cent), transport (74 per cent) and legal (73 per cent) sectors.

The survey indicates some resistance towards taking an affirmative action towards workplace diversity with nearly eight out of ten Asia Pacific employers (78 per cent) failing to implement an attraction program targeting people with a disability. Employers are also failing to implement strategies to attract people from non-English speaking backgrounds (68 per cent), people from Indigenous backgrounds (67 per cent), people aged over 45 (59 per cent), people from overseas (56 per cent), parents returning to work (54 per cent), or people requiring flexible work options (49 per cent).

Despite this, 94 per cent of organisations believe that a diverse workforce can be beneficial to their business.

"The 2008 Vedior Asia Pacific Employment Trends Survey supports the idea that organisations will need to continue to broaden their HR strategies to be all inclusive and foster a diverse workplace. Every person is unique in ability, background and experience, so taking a 'one-size-fits-all' approach will result in missed opportunities and a less prosperous workforce," says Ms Loveridge.

"The survey illustrates a labour market that has the potential to find success in 2008, despite the ongoing talent shortage. More can be done to build a successful and long-lasting human capital program. Employers need to have strategies in place that are flexible enough to meet the changing nature of today’s workforce."

The 2008 Vedior Asia Pacific Employment Trends Survey was conducted throughout Australia, New Zealand and Singapore and included 1044 responses from professionals within large organisations as well as small-to-medium enterprises representing 23 industry sectors.

For every completed survey a donation was made to the Fred Hollows Foundation, which seeks to eradicate avoidable blindness in developing countries and under privileged communities.