Hiring outlooks continue to moderate while talent shortages persist

Talent shortages continue to persist and companies are thinking of new ways to improve hiring efforts, says ManpowerGroup’s Employment Outlook Survey. Seventy-five percent of employers report difficulty finding skilled talent, matching 2022's levels, and decreasing two percent from 2023's survey. 

The global workforce solutions company says its Net Employment Outlook (NEO) for the first quarter is 26 percent, up three percent year over year, but down four percent from last quarter.  

The latest survey reveals that while employer hiring confidence has moderated slightly amid global economic concerns, labour markets remain tight and demand for skilled talent is still strong across multiple sectors. As companies continue to transform their business models, many are holding onto the talent they have, and struggling to find the new talent they need. The data suggests organizations are committed to offering flexible work options, recognizing that this can give them a competitive edge for attracting and retaining workers.  

We're in unprecedented times in terms of a supply shortage, both a supply of workers, but also a talent skill shortage. It is crucial for us to find an engaged talent, wherever it exists and truly broaden our definition of talent, says Becky Frankiewicz, president, North America region and chief commercial officer, at ManpowerGroup.  

Changing up requirements 

“Employers put filters on talent to pursue the marketplace and those filters, especially when it comes to the technology sector, have dramatic impact. I'll give you an example. With data scientists in the US, if you put a filter of three years experience required, you lose 50 percent of your available candidate pool 50 percent. If you add one skill filter that is common – must have three years experience – you lose 75 percent of the available candidates. So, these traditional requirements on talent cannot be used in today's very limited supply environment.  

“Employers will have to broaden the aperture they have to become creators of talent versus consumers of labour, which speaks to upskilling. They can unlock skills by teaching people new capabilities. They also have to open their aperture around requirements. Do the really need three years of experience?  

“Most employers start with a number of years of experience instead of the skills that are needed, including soft skills. So, they should reevaluate the requirements for a job.” 

Frankiewicz adds that employers should also tap into diverse talent pools to be able to attract not only the diversity, but the people that they need. The business case for diversity was made decades ago showing it is important to have a diverse workforce, including diversity that may not be obvious, to bring a culture of belonging. Employers with a diverse workforce have improved business results because they are more agile with multiple points of view that come from different experiences.  

Employers also need to demonstrate to potential employees the value of working at their organization. What does the company offer to stand out as an employer of choice for the type of candidates they are seeking? 

Tech sector has brightest hiring outlook 

The survey says the strongest hiring is anticipated in North America with the IT industry having the brightest global hiring outlook followed by financials and real estate, communication services, health care and life sciences, and industrials and materials.  

To find, attract, and recruit talent, employers are offering more work flexibility (65 percent), raising wages (30 percent), and looking at new talent pools (28 percent).  

One of the main challenges to finding qualified staff is lack of technical skills, says the report. When asked about artificial intelligence (AI), employers cite training staff, finding qualified talent, and redefining roles as the top challenges to fully leverage the technology. Additionally, as companies adopt more sustainable practices, employers estimate at least 54 percent of all technical skills will need to evolve to keep pace with the green transition. 

ManpowerGroup’s Employment Outlook Survey is based on data collected from more than 40,000 employers in 41 countries in October 2023.