Introduction:
The past few years have seen unprecedented changes in hiring patterns and the recruitment landscape. The Pandemic and subsequent return to work policies set new expectations around flexibility, working patterns and work-life balance. Offering such flexibility became a guaranteed way for companies to coax talent into starting a new position. This is arguably the most important catalyst in starting the ‘Great Resignation’ and ‘War for Talent’ where headlines reported more open positions than candidates and that to be truly competitive, companies needed to offer more generous salaries and devise clearly written contracts which specified the model of working. Economic discourse centred around wage inflation whilst hiring managers and recruiters alike felt the pressure of operating in a candidate-driven market. 2023 saw less growth in the economy, with PE houses and corporate finance firms reporting less deal activity which was mirrored by a decline in job postings when compared to previous years.
As we start 2024, we wanted to reflect on the past year and spotlight the topics that we feel will dominate conversations about recruitment for the year ahead.
From a Candidate-Driven to a Client-Driven Market:
For many businesses, hiring demand appears to have waned in 2023. Some of the gloomier headlines in recent months point to the Bank of England predicting zero economic growth for the fiscal year of 2024, whilst a recent study from KPMG has shown that GDP fell by 0.3%. However, it is important to note the Indeed Job Postings Index remains 9% above the pre-pandemic baseline suggesting the job market remains fruitful. Ambitious candidates will still have more opportunities available to them but now more than ever, they’ll have to do more to stand out.
Concern around an impeding recession and slower economic growth has meant that businesses are no longer looking to hire with such urgency as before. This is likely to result in increased competitiveness at all levels of the market and may signal a return to a pre-COVID client-driven market.
For employers, having greater choice of candidates will undoubtedly result in them becoming more selective about the talent they hire. The knock-on effect of this is likely to be stagnant wage inflation where candidates can’t command the same salary hikes they have done or expect their salaries to rise as rapidly.
For candidates, increased competition means they’ll have to do more to impress. Technical skills will be a given in 2024 and there will be a greater focus on employees wanting to see a candidate’s softer skills and ways in which they have gone ‘above and beyond’. Candidates will need to look at more creatives ways to get in front of employers and ensure that their CVs and LinkedIn profiles showcase not just relevant experience but recognition and recommendations.
AI & Automation:
2023 witnessed the rise of AI programs and software tools for the workplace. 2024 will continue to see AI explode and be much more commonplace, however the challenge will be for hiring managers and businesses try to balance digital transformation whilst ensuring their business remains people focused. When used effectively, AI and automation could greatly benefit the recruitment process. For hiring managers and recruitment consultants, AI can rapidly speed up administrative tasks, assist in the writing of advertisements and job specifications whilst creating personalised content to enhance the candidate experience. Candidates will be able to harness AI to assist with CV writing and formatting allowing them to tailor their resumes to individual vacancies and apply to more open positions in a shorter space of time. Equally important for HR teams will be AI’s implications on talent mapping and analytical processes; AI can survey teams’ skills and competencies, identifying gaps that can inform both the hiring process and professional development sessions.
Crucial to 2024 will be how teams and companies balance utilising AI for its merits against becoming dependent on tools that are clearly not substitutes for a person’s work.
Flexibility and Culture:
Flexible working will continue to be a pertinent issue for businesses in 2024. Immediately after COVID, businesses were quick to point to its merits, namely higher job satisfaction and being able to attract talent independent of their physical geography. However, working remotely raised important questions on how we continue to build a company’s culture, ensure rapid communication, effective decision making and maintain business cohesion. Immediately after COVID, nearly 1/10 of businesses adopted flexible working practices. Yet for many, the answer has been to call upon staff to return to the office citing concerns around productivity and collaboration. This is most notable in international enterprises such as Meta, Google and Apple but we have noticed many of our northern-based SME clients are following in this fashion. Candidates who are willing to return to this model of working will benefit from more opportunities but new legislation will raise questions and challenges for businesses. Passed in July 2023, the Employment Relations Act will come into effect in the Spring of 2024. This will allow employees to request flexible working twice within a 12-month period. Employers will be expected to consult with employees before deciding and an employee will not have to explain the effect the change might have on the employer. Organisations will now face more complexity in navigating the Act’s legal ramifications whilst continuing to debate how beneficial flexible working is.
DEI:
Diversity, Equity and Inclusion rightfully remains an important topic affecting businesses of all sizes. DEI initiatives within the recruitment process have seen unconscious bias training, inclusive hiring practices and culture workshops to ensure all employees feel seen and valued. Research from Workday suggests there has been increased funding for such initiatives forming a wider strategy of ensuring an organisation can access and retain a skilled, diverse workforce. Excitingly, the UK appears to be leading the way in this field. The same research highlighted that 72% of their organisations have a budget specifically for DEI programmes whilst 34% of their employers plan to increase their DEI budgets within 2024. It is highly likely, that throughout 2024, we will witness businesses continue to champion DEI as part of a long-term commitment to build a more equitable and inclusive environment in which all their employees can succeed – which will result in better hiring processes, ensuring opportunities are more widely accessible.
How can Axon Moore help you navigate these trends?
A dedicated recruitment agency can make the ideal strategic partner to advise you through this uncertain landscape. Although the number of active job vacancies declined in 2023, the Indeed Job Postings Index remains 9% above the pre-pandemic baseline suggesting the job market remains fruitful.
Working in partnership with a specialist consultant will present introductions to business leaders and create opportunities.
Additionally, whilst some may be put off by companies insisting on a 5-day office working week, this is a great time for ambitious, motivated candidates to differentiate themselves. Through proving they will go above and beyond in these roles they will undoubtedly stand out from increased competition and may experience greater professional development when compared to a remote-based peer.
Whilst AI can be transformative for the recruitment process, it is not able to replace a genuine human agency. The role of a consultant is to match talented individuals with compelling opportunities. Ultimately a consultant will have the connections with business leaders and is well positioned to effectively tell the story of a candidate and a business journey with the nuance and relevance that a machine won’t be able to replicate. Similarly, if a business insists on full-time office working, they may be met with fewer than expected applicants. A specialist consultant will be responsible for communicating why this is necessary and why it is a compelling opportunity. They will have in-depth knowledge of the market and be able to make recommendations that still fit within a company’s expectations and framework whilst simultaneously marketing the position to their talent base. Finally, any forward-thinking, committed agency should be monitoring their own commitment to DEI. We ensure that we follow this by analysing our shortlists within executive roles and trying to ensure a balance of protected characteristics before we present CVs to a client.
Conclusion
2024 will undoubtedly present fresh challenges and opportunities for businesses looking to recruit but a specialist recruitment partner can serve as a public ambassador for your business whilst being able to guide you through these nuanced conversations. Our value lies in the true partnerships we make with our clients & candidate, the recommendations we make for a new hire, and our ability to help diagnose problems within teams suggesting viable solutions.
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