Ever since recovery from the Covid pandemic got underway, the shortage of workers known as ‘the talent gap’ has been a continual problem for the recruitment industry and employers. However, that situation looks like it is set to change.
The rising cost of essential items is shrinking the disposable income of many people in economies right around the world. Businesses that provide non-essential products and services are likely to be hit hard, with the prospect of closure facing many and reducing the demand for talent
The failure of businesses is also set to increase unemployment, by dumping a surplus of talent back onto the job market. The overall impact of reduced demand and increased unemployment would reverse the trend of the record numbers of vacancies we have seen in developed economies, including Australia and the UK.
Recruiters that specialise in large but non-essential areas of the economy, such as hospitality, holidays, luxury and leisure sectors are likely to experience reduced demand first, as these types of businesses are at the leading edge which relies on consumer confidence and discretionary spending power.
The closing of the talent gap is a welcome prospect to many recruiters who have struggled to keep pace with their client’s demands.
Indeed, some have been deploying questionable practices to stimulate passive candidates and boost recruitment efforts. Anecdotal evidence suggests some agencies have targeted workers with the right skills by posting large signing on cash incentives, measured in thousands, not hundreds, on windshields of cars in company car parks.
Desperate tactics aside, the predicted closing of the talent gap accompanied by falling demand for talent is truly a double-edged sword. As has become part of the narrative of our ‘age of disruption’, there are set to be winners and losers.
For jobs where there is a shortage of highly skilled workers with specialised knowledge, such as in the technology sector, the prospects for candidates and recruiters remain strong. But for many others, there is likely to be a less prosperous outlook.
The operating environment remains wildly uncertain, shaped by geopolitics and economics and characterised by upheaval, all factors way beyond our control. It seems impossible – perhaps even foolish – to try to second guess what might happen next. More than ever, this underscores the need for flexibility and value in the products and services recruitment businesses consume.
Recruitment and staffing businesses minimise costs and streamline for efficiency when choosing ETZ as their RecTech partner. ETZ provides flexibility by enabling hybrid working across your back office team and comes with value ‘baked-in’ – by helping to maximise the bottom line.
ETZ’s leading timesheet and invoicing solution, streamlines the back office processing of your recruitment agency. Our complementary solutions, ETZ Comply for onboarding and document management, and Caspian for business intelligence give agencies further capability to streamline and uncover opportunities. To find out more call us on 0800 311 2266 or book a demo.
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