HR Update: Remaining Competitive in a Tight Labour Market

May 2022 Labour Force Update

Unemployment rates reached another record low in May, as job growth continues. Numbers, breakdown and analysis of Statistics Canada’s report
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HR departments and executive leadership are currently dealing with not only a hot labour market and a return to the office, but also questions regarding flexibility, compensation, and boundaries. Strategic consideration will help reduce missteps during this critical period of evolving workplace paradigms, so careful focus is required. The following developments and points of differentiation are all worth considering. 

Two Way Communications Fundamental During Return to Work

As of May, just under one in five Canadians were doing the majority of their work from home,1 a number that is trending steadily downwards. As more and more companies mandate a return to the office, employee reactions range from outrage to glee. Organizations considering  updates to work arrangements (or any policy) are wise to gather employee feedback and factor it into their decision. While many employees are aware that working full time from home is not going to continue indefinitely, there remain elevated expectations with regards to flexibility and work-life balance. 

Productivity, collaboration, mental health, recruitment, and retention are just a few factors that must be weighed when making such decisions. Understanding how employees feel can help companies avoid, or at least prepare for, potential negative repercussions.

More general surveys such as the Gallup Q12 Employee Engagement Survey can also serve organizations as useful predictors of performance.

Disconnecting from Work and the Importance of Boundaries

Ontario recently passed a law mandating that companies with 25 or more employees craft policies on after-hour expectations of employees.2 The law is part of a larger discussion about work-life balance and the blurring of lines between home and work life. Even something as simple as a video meeting can offer a glimpse into an employee’s home, something not everybody is comfortable with. 

While it remains to be seen whether other provinces follow suit with similar laws, it’s a good idea for companies to proactively establish boundaries that allow employees to keep their personal and professional lives separate. 

Compensation Reviews and Job Evaluations

As companies seek excellence in a competitive labour market, they may find themselves paying top dollar to land required talent. When new employees earn more than the counterparts they join, there can obviously be a detrimental effect on company morale, possibly motivating longstanding employees to seek work elsewhere. 

It’s critical that HR and Finance conduct regular compensation reviews, both externally, to ensure that their recruitment efforts are successful, and internally to ensure good retention. 

These reviews must ensure that pay is equitable, given the job, required skills, responsibilities, etc. In cases where it’s necessary to hire at a higher level, internal reconciliation will be required. 

The pandemic, too, has led to a reshuffling of responsibilities for many employees, rendering their previous job descriptions inaccurate. Employees who have been charged with new tasks should have their roles formally re-evaluated and redefined to ensure that they are being properly credited and compensated for their work. 

Development Opportunities a Powerful Recruitment Tool

Competitive pay is a must-have in order to attract top talent, but it’s not the only way for an organization to differentiate themselves. Companies that give employees a clear path to job progression will have a strong competitive advantage in the current market. This could include job training, professional development, and opportunities for promotion. Even opportunities for lateral movement can entice individuals to stay within a company’s ranks, as opposed to fishing for opportunities elsewhere. 

Providing Candidates a Professional Experience

Another way for companies to stand out is through providing a professional experience to candidates. Strongly written job postings and good social media promotion can help companies attract talent, as can working with a top tier recruitment firm.

Timely follow ups throughout the interview process will also help companies gain a strong reputation, a pertinent differentiator given the ease with which such information is shared between candidates online. 

This imperative to provide a positive experience extends to the onboarding process. The first 30-60 days are critical in terms of ensuring that a new hire builds strong connections with their direct manager and co-workers, thereby setting them up for success. 

Re-Connecting with Co-Workers Leads to Retention

Another important retention piece is the connection that people feel with their workplace and co-workers. Despite the relative success of the great work-from-home experiment, it cannot compare with the actual workplace in terms of fostering relationships. In situations where employees are being tempted by outside recruiters with competitive compensation packages, the desire to remain in a cohesive group can be a difference maker. 

Keeping up to date on employee expectations, as well as the laws that surround the workplace, remains a must for organizations that wish to recruit and retain top talent. With so many elements of work life evolving, it’s simply not viable to hold steadfast to a static approach. Those who base their approach on market dynamics and best recruiting practices will ultimately be rewarded with superior teams. 

Cited Sources
1“More People Are Heading Back to the Workplace, but That Doesn’t Mean They All like It | CBC News.” CBCnews. CBC/Radio Canada, June 11, 2022.
2“Ontario Becomes First Province to Mandate Policies on Disconnecting from Work.” CTVNews, June 4, 2022.