Tight Labour Market Leads Employers To Focus On Retention Strategies Including More Flexible Work Environments

Auckland, 11 October 2022 – With talent availability at an all-time low, employers across New Zealand are focusing on staff retention, finding new ways to engage employees and building comprehensive benefit packages.

The recently released 2022/23 Beyond Recruitment Economic and Labour Report found that employers are finding it extremely challenging to retain staff.

• 95% of employers say it is harder to find suitable talent now than prior to the pandemic, a figure that has risen from 27% in 2020 and 86% in 2021.
• 83% of employers said it is more difficult to retain staff now than in 2021.

Liza Viz, CEO of Beyond Recruitment says: “Over the last five years of our Beyond Recruitment Economic and Labour Report, we have seen a huge shift in the labour market. Although a tight labour market is a challenge, we’re seeing New Zealand employers responding to this pressure in a very positive way by focusing on understanding their employees and really thinking about what makes their organisation a great place to work. There’s been a strong upwards trend in the numbers of organisations offering non-cash benefits and wellness programmes.”

In response to the challenging landscape, employers have become highly focused on seeking employee feedback, fixing engagement issues and boosting their suites of additional benefits.

• The number of businesses who did not identify any employee engagement issues to fix dropped from 49% in 2020 to 13% in 2022.
• Flexible work policies are the most popular method of employee engagement with 80% of employers using them, followed by employee assistance programmes (EAP) at 73%; professional development at 66%; health and wellness initiatives 62%; and stress management programmes/resources 43%.
• Two thirds of organisations (77%) are offering hybrid working arrangements, and the same number are offering flexible work hours.

Liza recommends that employers can better engage employees by focusing on achievements and outcomes. At a strategic level, employers must look at the whole workforce and consider using career progression road maps, currently utilised among 49% of employers. These help employers understand the career paths that they are offering - and better communicate and progress current employees on growth paths.

“Particularly for younger generations, learning and development of different skill sets is key to their retention. Employers will keep people by teaching them new skills,” comments Viz.

“However, don’t forget your senior leaders. Often businesses are so focussed on the junior to mid-level workforce that they forget about senior leaders. These vital leaders want to be engaged with transparency and honesty. Seek their feedback about what they need to develop their career – often it’s around getting to the next-level of leadership. For example, they may have interest in a board role or general management.”

Viz notes however, that tenure is generally now shorter than it was in decades past. “Times have changed. Tenure is not one-size-fits-all. In some roles, employers want to see around 18 months on a jobseeker’s CV as good tenure, whereas in other senior roles including leadership and executive, employers and the board certainly want to see longer. Tenure is also linked to achievements. Did the person achieve what they set out to achieve? Did they deliver to their accountabilities? Are they a completer finisher in terms of what they were taken on to deliver?” she says.

Viz believes that the talent shortages will be ongoing through 2023. She advises that employers responding with a holistic approach to how they recruit, what skills they recruit, and embracing strategies to retain staff, will get through these times until talent flows resume.

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