Business leaders urged to invest in skills of current staff
27 June 2014 -
With hiring the right talent set to remain a major hurdle for bosses in the coming 12 months, report from major auditor KPMG shows that boosting in-house talent is vital
Finding staff with the right skills is one of the biggest headaches businesses faced last year, according to KPMG’s latest Business Instincts Survey. The UK poll of 498 C-suite executives reported a significant skills deficit faced by many companies, stemming from severe under-investment in staff over several years. The struggle to locate suitably skilled employees was ranked second behind achieving profitable growth in the major challenges faced by business leaders.
In a battle to reverse this trend, more than half (58%) of the businesses surveyed say they will boost their workforce over the next 12 months. However, with many businesses facing major problems finding the right workers, one third of the executives polled admit it is likely their workforce levels will remain unchanged in the year ahead.
As the economy starts to pick up again, the survey showed, businesses will face problems keeping their best staff and being able to appropriately financially reward their star workers. Robert Bolton, co-lead of KPMG’s Global HR Centre of Excellence, said that changes in staff demographics will force companies to use different tactics to attract talent, compared to previous years.
“The war for talent is back – but it needs to be fought in a different way now,” he stressed. “No longer can companies rely on rewarding high performers or tempting people to join with the promise of long-term financial incentives. With older staff needing, or wanting, to work past the traditional retirement age, and more young people coming into the workforce, there could be four generations of people in a company at any one time. It means that the challenges of achieving a diverse workplace and supporting a variety of flexible-working needs are forming the new battle front.”
Despite the difficulties in hiring, it emerged that UK businesses are much more confident about their financial status. According to the survey, with balance sheets improved and/or cash reserves set aside, more than one third (39%) of respondents claim that they do not need to borrow funds to grow their companies. Furthermore, 86% of businesses expect to increase their turnover this year, with a similar proportion (81%) believing their profitability will also gain momentum.
It is likely that global mobility – and the associated issues around skills, language and culture – will also dominate the minds of HR teams and their C-suite colleagues. While half of respondents said that they are already operating overseas, 26% said that they expect to be involved with international expansion in the coming year.
Bolton explained: “There is an increasing optimism among UK businesses, who have indicated a gradual rather than explosive approach to their investment plans this year. Many businesses are feeling that under-investment in staff during the downturn has led to a skills deficit, but that the solution is not as simple as going out and rehiring talent. The right people are not always available, and competition is tough for the best hires.”
He added: “Businesses may continue to struggle to find the talent they need, especially in highly skilled areas and, as starting salaries and staff costs have started to rise for the first time in years, it could ultimately mean that – while profits increase – for many businesses, the key focus of profitability could still fall.”
With all that in mind, there has never been a better time to invest in the skills of existing staff.
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