In the Asia Pacific region, the recruitment market is projected to grow by over 10 billion USD during 2020-2024. Businesses today are doing hiring at faster rates, and at higher costs – the staffing market in APAC is valued at over $100 billion USD. A Talent Acquisition 2019 report revealed that across Asia, the Recruitment Process Outsourcing market grew by 16% in 2017, with a large number of these deals signed by booming markets like India and China.
Globally, the imminent issue of talent shortage poses a serious threat on the current economies. Future of Work: The Global Talent Crunch report by Korn Ferry cited a labour skills shortage of 47 million by 2030, and colossally, an unrealized output in the trillions. Should there be any hope of bridging the gap, companies should acknowledge the fundamental issues with their recruitment practices.
Why it matters: the rise of talent crunch
How recruitment plays into business operations has always been apparent, but even more so today. The digital era, paired with the acceleration of tech trends amidst the pandemic, has ushered in digital transformation in businesses on a massive scale. Technological advancements have played a notable role in fuelling an urgent demand for an agile and skilled workforce that can keep up with the pace of the economy. Even with today’s heavy reliance on machine learning and automation, companies have to realise that technology will be rendered useless without the right workers to operate them or the right talent to develop the technology in the first instance.
We spoke to Paul about his entrepreneurial journey and his vision for GRIT
Regionally, there could be a potential talent deficit of 2 million technology, media and telecommunications (TMT) workers by 2030. Corporations and workers alike are starting to recognise this need, and there has been an aggressive push for upskilling, such as through government-incentive programmes or corporate e-learning solutions to equip workers with the right skills for digital jobs. More than that, however, hiring managers need to rethink ways to scale their process to keep up with the pace of the technology boom.
The approach to recruitment is all wrong
In most cases, companies outsource their talent acquisition to RPOs or traditional recruitment firms due to the fact that these firms specialise in hiring and have a better bandwidth for the task. However, in some cases, this can actually negate the need for alignment with organisational goals. Instruction is given briefly and job openings are filled externally, often including gimmicks or clickbait to garner more interest. Interviews are conducted by headhunters who have no idea what a business is built on, and they end up shortlisting someone with the most attractive resume which often makes the hiring process even longer.
The Talent Acquisition 2019 report mentioned above cited that there were three major challenges of working with RPOs: lack of familiarity with the industry (63%), recruiters’ inability to source and engage with business partners (58%) and poor outsourcing ability (58%).
Of course, the blame cannot be placed on RPOs or recruitment firms, but what corporations need to acknowledge is that human capital is essentially the backbone of successful companies and deserves more attention internally.
For one thing, finding a solution with an adept outsourcing capability could fix the problem for more than half the companies. This could be done by putting talent first and curating pools of more specific skill sets across digital and technology at , a higher standard for consideration – think of something like a bustling ‘talent marketplace’. All this can be achieved through digitisation and refinement of the recruitment process through automation, machine learning and data analytics, as what firms like GRIT have done.
For many companies a shift away from traditional approaches to source talent would mean challenging the status quo and a ton of restructuring and education, however the reality is that current processes aren’t providing the best outcome, and a different approach is needed if companies want to achieve a different outcome . Not surprising, as with any societal advancements, change often takes time – but it should not be put off. This pays off too, for external hiring costs, companies are looking at an average of $4,500 USD cost per hire.
Quantity gets valued over quality
Delving deeper into the issues with the current approach to recruitment, itis often built on a business model of quantity over quality. Recruitment vendors or internal HR teams scour platforms like LinkedIn and blast classified ads, seeking to jam pack senior management with as many options as possible.
Companies can often end up with a pool of “passive” candidates, or eager jobseekers that may seem qualified, but are not the right fit for that particular role . An extensive list of candidates can create a false perception of a successful hiring attempt and oftentimes a talent can be appointed because of this process and they were the best of that particular pool – but that should not be the only thing to consider. Needless to say, the value of one skilled worker surpasses that of a dozen misfits, but it might be just a tad easier to achieve the latter.
To do away with a mismatched employee would bring in financial implications from rehiring costs – this study found that the average cost of losing an employee is 33% of their annual salary. Companies have to sit down and ask themselves if the opportunity cost is worth it.
Nobody pays attention to candidate experience
Scarcity of tech talent has led to them now holding a coveted spot in the hiring funnel – with more of them going as they come. However, candidate experience often lacks attention, with 83% of candidates rating their job experience poor in a Deloitte survey.
That is why in Southeast Asia, 70% of hiring managers took at least 3 months to fill open tech positions. The reality is that for the most in demand roles across technology and digital, the best talent often don’t apply to roles, simply they wait to be approached and are approached multiple times on a daily basis. This often leads to frustration or fatigue of entering into a dialogue with companies when salaries or expectations aren’t met. . Reversing the dynamics of recruitment could actually work in favour of employers – a process which requires pivoting to an approach where talent’s needs have to be met, not just compromised on.
Suppose your business is built on a multifunctional, cross-strategic model and requires workers to take on a range of tasks, as is the case for most tech businesses today. Finding the right talent that fits the job scope could speed up productivity, as compared to hiring several average workers. Employers need to take on a modern outlook on recruitment – by going digital and approaching first.
That does not mean to strip the recruiter of any say, but have talent play a bigger role in differentiating themselves from the rest of the crowd. In today’s job market, talent holds the power, and failing to see this can be detrimental to a business. After all, the hallmark of every Silicon Valley unicorn is a good team running a tight ship behind the scenes.
Remaining stagnant in practices can sometimes be the easiest way to go about things. With a flourishing global economy, emerging technologies and increasing employee expectations, the war for talent in the tech industry will continue to rage on if companies remain complacent about talent’s role in organizational success. It is time we put talent first.
This article was contributed by Paul Endacott, CEO and founder of GRIT
About the author
Paul is a highly driven leader who has been operating in the fields of recruitment and executive search since 2002. With a proven track record within global multinationals and regional organisations, Paul has experience of turning around underperforming operations and scaling businesses from start up to over 150 employees. Paul’s last corporate role was Regional Managing Director, Asia, for an Australian Listed recruitment firm where he was responsible for the Asia strategy as well as leading Digital and Innovation.
Most recently, Paul has launched his own Venture/Angel backed company, GRIT, that specialises in Digital and Technology. This is a recruitment technology organisation that is driving a recruitment and executive search solutions platform to provide greater value and engagement with organisation and talent communities.
Paul is highly passionate about digital and technology and how it can be utilised to advance the recruitment and staffing industry.
Based in Singapore, Paul has extensive experience of the Asia markets as well as the UK.
In addition to the above, Paul is an Advisor at Antler, supporting their HRTech cohort globally and also a Mentor at Workplace Accelerator.