With wage growth expected to remain sluggish over the next five years, companies seeking to attract new talent need to think about what other benefits they can offer, one human resources expert says.
A recent report by Deloitte Access Economics predicts wage growth will return to a 2% increase in five years because of down-trending inflation rates.
“Measured using the wage price index, wage gains were only a little over 2% when COVID-19 hit, and we forecast they’ll only return to that relatively sluggish rate by late-2025 or early-2026,” the report said.
“Wage and price growth has been on a downtrend for decades, both locally and globally, and the coronavirus crisis will keep both bumping along the bottom for some time yet,” the report says.
Alex Hattingh, chief people officer at Employment Hero, says in this post-COVID-19 economy, businesses must think about their “entire employer value”.
“Employers need to focus on their entire employer value proposition, and that’s what else people are looking for in their jobs,” Hattingh tells SmartCompany.
Hattingh says there is plenty of research to show that workers desire flexible working conditions and career development opportunities from their workplaces as well as a good salary.
“There’s just been astounding statistics around employees wanting to continue with flexible work, and the ability to work from home,” she says.
“Some of the softer things that you can offer really need to be highlighted by companies to attract talent.”
Attracting talent for high-demand roles will always be difficult Hattingh says, and jobs within that category such as in tech and engineering have not been overly affected by COVID-19.
“You might have more talent on the market, but you’ve also got people who are working for companies that feel very secure, so it’s hard to attract them out of a job where they feel that real sense of security,” she says.
Shift to remote work
Many employers fill high-demand roles with overseas workers using visa sponsorships, however, the global pandemic has made this difficult and has brought about new trends in the human resources space.
“There is going to be a trend where companies will hire remote workers now that they have navigated how they can effectively manage a virtual workforce,” Hattingh says.
Hattingh says the outsourced-employee model, formally known as the professional employer organisation (PEO) model, has grown throughout 2020, and she sees no sign of it slowing down.
“A PEO model is where someone else actually employs the person for you, someone who knows the legislation and the compliance obligations of another country, and that company is also responsible for paying that individual,” Hattingh says.
Hattingh says it is a great way for employers to access international talent without having to navigate complex employment law and compliance obligations.
“It takes away all of that risk and headache,” she says.