The holidays were a good time to look back on the year 2021. The second year of the corona era was productive for us in terms of assignments and client projects. Companies realized that the epidemic did not mean the end of the world and that life would continue. Preliminary data on the omicron strain indicate that, despite high transmissibility, the new virus strain may not be as pathogenic. So let’s be optimistic!
What were the key findings from last year’s executive search assignments?
On the positive side, I was surprised by the ability of people and organizations to adapt to changed circumstances. Expenses became an important keyword (especially in the second half of the year) for the companies. Inflation in commodity prices and global supply difficulties forced managers to think about different business scenarios. Business leaders were figuring out (and still do!) whether and how to pass on costs to customers in an inflationary environment.
The situation in the salary market has been an unpleasant surprise for everyone. While there has been talk for years of salary pressures in the segment of engineering professionals and skilled workers in Estonia, the pressure on managers´ & executives´ salaries has also increased. The so-called “repurchases” of the leaving employee by the employer have been frequent. It is cheaper to “buy back” an existing good person than to take the risk of a new employee with a higher expense number. We noticed that in certain fields, jobseekers were running 3-4 competitions at a time. We will see how long it takes the markets to find a new equilibrium.
This year, it must be taken into account that finding a suitable person may take longer time than planned. A time buffer should be planned for recruitment process.
The winners in the labor market are team leaders who can find common ground between talent’s career ambitions, his/her overall vision of life, sources of motivation and what the company can offer. In addition, it is critical that the recruiting manager will take responsibility from HR for getting the right person for the team. Hiring managers must become the brand ambassadors during the recruitment process.
The companies need to think more and more about the job position-centered value proposition in hiring process. Generic slogans no longer work. The current situation reminds me of one co-operation project with one of the legendary Estonian software development companies in the period of the previous boom era 2005-2006. The company was notorious at the time for absorbing talented IT professionals. I had the rare opportunity to participate in job interviews and see inside how it all looked like. The meeting with the candidate lasted a maximum of one hour. In the first forty-five minutes, the hiring manager decided whether or not he was interested in hiring the candidate. After that, he shut down the computer and presented a superb pitch why to join the company focusing on the benefits and unique development possibilities. At first I thought it was a solo of one leader, but over time, working with other teams, I saw that it was a pattern.
Understandably, a good employer brand strategy will not solve the labor crisis on labor market. The lack of good people is one of the signs of economic growth. For some reason, all the ups and downs reach our small open market with leverage. On the positive side, it also forces entrepreneurs and managers to think more carefully about their business plans and focus on bottom line. This year will be a challenging one for executives and managers. However, the history shows us that we have the skills to adapt, being flexible and rely on good judgment.
We wish all our customers, partners and friends success, good health and bright moments also for your personal life!