There has been a prevailing sense of optimism in Ireland in recent months. The economy continues to grow, and the UK’s decision to leave the EU has led to the prospect of numerous opportunities for Irish organisations in the months to come.
This is reflected in employer outlook for business activity in the year ahead. Our Hays Ireland Salary & Recruiting Trends 2018 guide surveyed over 1,700 employers and employees from organisations of all sizes throughout Ireland, and found that the vast majority of employers expect activity levels to increase or stay the same over the next year.
In addition, nearly three-quarters of employers said they plan to hire in the next 12 months, indicating confidence in the market and reflecting a strengthening Irish economy that is poised to capitalise on any opportunities in the year ahead.
However, this positivity and growth bring its own set of challenges, the most prolific of which is an acute skills shortage being felt by almost all employers. The shortage of skills is creating an extremely competitive candidate market which, if not countered, could negatively impact productivity and growth plans.
Employers are taking a range of approaches to address the immediate gap in skills, including hiring temporary staff, increasing training budgets and recruiting workers from overseas. In particular, we are seeing employers in the construction, life sciences and IT sectors looking further afield to find talent, and working to entice Irish expatriates to return to Ireland during this time of opportunity and growth.
Suitably experienced professionals are making the most of the high demand for skills, as employers increase salaries in a bid to secure the talent they need. However, this brings additional problems for hiring organisations, as unrealistic salary expectations are highlighted by more than half as a major issue when recruiting.
1. Skills shortages remain prevalent
Over three-quarters of employers stated they have experienced moderate to extreme skills shortages in the last year and, of these, a fifth labelled them as extreme.
2. Employers are concerned about productivity
Widespread skills shortages are having a negative effect on productivity for half of employers. Other far-reaching impacts of the gap in skills include growth, innovation and business development plans.
3. Employees are feeling the pressure
Skills shortages are also causing employee morale to suffer, and employers are noticing an increase in absenteeism due to workplace stress. The need to build a more positive work-life balance is especially pertinent given that a quarter of professionals value work-life balance most when considering a new role.
4. Salary increases for skills in demand
On the whole, salary increases have remained tempered in the last year, with almost a third of employers only increasing salaries by up to 2.5%. Skilled professionals working in industries which are experiencing greater growth, such as IT and construction and property, are seeing more significant salary increases as employers compete to secure the best candidates.
5. Candidates seeking progression
Outside of salary, employees are looking for greater scope to develop their careers, but 41% don’t feel there is any scope for career progression within their current organisation. This perception is driving almost a quarter to plan to leave a role due to a lack of future opportunities.
To help overcome these issues, it is up to employers to review their workforce strategy and immediate plans. Ensure strengthening your employer brand is a priority, as well as adopting an effective use of contingent workers to alleviate some of the pressure felt by your current employees.
Employers that invest in their people strategy, looking at both the short and long term, will be best placed to address skills shortages. This will enable organisations to meet their growth plans and to be in the best possible position to make the most of any the opportunities on the horizon.
For further insight into salaries and trends that will impact on your organisation and workforce, request our latest copy of the Hays Ireland Salary & Recruiting Trends guide.
Simon joined Hays in 2006, having commenced his recruitment career in 1993. Initially responsible for our businesses in Western Australia and Northern Territory, Simon relocated to the UK in 2014 where he was responsible for our operations in the West & Wales and Ireland, before being appointed Managing Director of the UK & Ireland business in 2018.
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