Employers in the public sector are increasing salaries to record levels in response to labour shortages and the cost of living crisis, with half (52 per cent) of them reporting hard-to-fill vacancies, a report from the CIPD has found.
The CIPD Labour Market Outlook found that recruiting in the strike-affected health and education sectors was particularly difficult, with 60 per cent of businesses in the education sector and 55 per cent of companies in the healthcare sector reporting difficulty filling job roles.
In the survey of 2,019 senior HR professionals and decision makers, 45 per cent of employers in the public sector predicted that there would be considerable difficulties filling positions over the next six months.
In the research two fifths (40 per cent) of private sector employers reported hard-to-fill vacancies and 23 per cent predicted substantial challenges filling vacancies in the next six months.
Idris Arshad, people and inclusion partner at St Christopher’s Hospice, said the ongoing strikes and issues with pay dis not make the education and healthcare industries “attractive places” in the long term – but suggested recruitment could be the answer.
“Be prepared to build your own talent pipeline for hard-to-fill vacancies… people want money, but they also want nice workplaces where they better themselves. Getting the data behind why a recruitment campaign was a success or a failure goes a long way in the search for the right candidate,” said Arshad.
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“It is important to continually improve every bit of the recruitment approach uniquely to each job, which could be the difference in securing the right candidate.”
The research also found that expected pay awards in the public sector have risen to 3.3 per cent in response to existing challenges – the highest level reported since tracking began in 2012, according to the CIPD report.
However, despite the record gain, pay still falls short of private sector employers’ median base pay expectations of 5 per cent, which still report having difficulties recruiting the staff they need.
Jon Boys, senior labour market economist at the CIPD, said that although the labour market may have recently been less competitive, there was still a high demand for people across the economy, with companies in the public sector having a particularly difficult time filling open positions. “Pay will be key for many people in the cost of living crisis, but employers should look beyond this to the full range of measures they can take to boost how they recruit and retain their employees,” he said.
These include more inclusive recruitment strategies, creating more flexible jobs and investing in training and developing line managers’ people management skills, Boys added.
The report also found that, as well as raising pay, the two most popular responses by employers to plug hard-to-fill vacancies over the past six months were staff upskilling (used by 55 per cent of public sector employers vs 49 per cent of private sector organisations) and increasing the responsibilities of existing employees (used by 48 per cent of public sector employers vs 34 per cent of the private sector).
Additionally, it found that 21 per cent of public sector organisations and 32 per cent of companies in the private sector were improving job quality by increasing flexible working.
Steve Herbert, wellbeing and benefits director at Partners&, said employers in many sectors were facing real challenges to recruit, given that the nation was close to full employment, and public sector organisations were particularly challenged because pay there has frequently lagged behind inflation for much of the last 10 years. “In a continuing cost of living crisis, salary is of course a key factor to many candidates, yet employers should also do what they can to promote other less obvious but still very important components of their remuneration offering,” he said.
Herbet suggested that a pension scheme that goes above and beyond the minimum legal requirements would appeal to many experienced workers, especially as this type of employee is in high demand. Flexible working remained a good recruitment and retention tool, as well as one that may help the candidate avoid some additional costs, he said.
Meanwhile, Jane Sparrow, director of The Culture Builders, argued that culture played a key part in staff retention when pay cannot be high enough. "Of course, salaries have to be fair and, if someone is underpaid, it will always be a challenge. But, equally, if someone is overpaid, but bullied, abused or exploited at work, then they are really in a no better situation,” said Sparrow.