Talent Shortage Drives Higher Salaries
Talent Shortage Drives Higher Salaries
The recent Report on Jobs published by The Recruitment and Employment Confederation (REC) and KPMG tells of increased vacancies in the economy, with expansion of both permanent and temporary opportunities. Salary growth is reportedly growing at its fastest rate for 6 months within an environment of falling candidate availability.
Financial services as a sector exemplifies this trend, with anecdotal evidence that incidences of the counter offer have returned to pre-recession levels. Given that it seems like only yesterday that the financial sector was in crisis, can the current situation be attributed to pure supply and demand or are there other factors at work?
Hiring practices that started to change during the recession have largely created the candidate situation post recession. Financial operations have not only rationalised their operations, but with a focus on risk management as well as cost reduction, have taken a much more stringent view of candidate quality. Requiring most of the boxes to be ticked from a selection point of view has created a demand driven shortage of the best talent, with a resultant increase in price.
Retraining can be a lower cost option for financial employers, although pressure from regulators may rule this out as an option if ready-made hires are required to strengthen organisations from a governance or compliance perspective. For the time being at least, top financial talent comes with its price.