One thing is for sure. In the coming years, as business owners you will need to become more flexible with your workforce to ensure that your business continues to adapt and thrive. The most important conversations among business leaders today focus on the future of work, what the workforce will look like, and the challenge to attract, engage, and retain top talent. Think about the changes in the vacation rental industry and how your workforce may need to adapt.
- Have you considered how the high speed and pace of technology change may affect your current workforce?
- What are you doing today to prepare for your future workforce?
- What is your strategy to remain relevant in your marketplace?
As you consider your answers, it’s important to understand today’s employment landscape, and what you as employers can do to get ahead of this curve. Scanning the environment is key to understanding the employment climate.
While the economy is still thriving, there is a labor shortage for all industries across the spectrum. Record low unemployment (May’s unemployment rate of 3.6 percent is the lowest rate since December 1969) combined with tighter immigration policies is making it challenging for employers to attract and retain the right talent.
Although unemployment remains low, there are still many jobs available. The problem for employers is that there isn’t a skilled workforce to fill all the open positions. A study by Bloomberg and Workday found that college graduates are not bringing enough technical or soft skills to the job market; in fact, only 35 percent of employers feel that college graduates are sufficiently ready to join the workforce.
Hiring talent remains a top concern for CEOs. As reported in the most recent Conference Board annual survey, CEOs stated that the failure to attract and retain top talent is the number one issue on their minds. The Conference Board found that business leaders view the unavailability of talent and skills as the biggest threat to their business and that they recognize how the high cost of outside hiring may affect their business decisions.
Business leaders are focusing their attention on people analytics (data analytics for your workforce) so that they have the data they need to make strategic human resources decisions. There is a lot of talk about data analytics in the vacation rental industry, but the focus has been on finance, marketing, and sales. Imagine making a business decision to change your PMS software without using financial reports and other data analytics to guide your decision. Most business leaders would not make that decision without fully understanding their ROI. Yet this is exactly what most people do when making key decisions that affect their human resources. People analytics has the ability to touch every aspect of managing your human resources, from calculating the cost of turnover to measuring the productivity and engagement of your workforce. Now is the time to focus on people analytics and the largest expense line—your labor.
Employee demographics are shifting. For the first time, there are five generations in the workplace, and this requires a new way of doing business. Companies are bracing themselves for an influx of millennials. Millennials are now the most prevalent generation in the workplace and are on track to make up 50 percent of the workforce by 2020. Generation Z is following in their footsteps. These two youngest generations will comprise nearly 70 percent of your employees in the next few years. What are you doing now to prepare for this generational shift?
With five generations in the workplace, it means that the solutions you currently have in place for attracting, engaging, and retaining talent can no longer be deployed as a one-size-fits-all approach. Engaging five generations in the workplace side by side requires you to actively seek out and value diversity and inclusion. Focusing on creating a more diverse workplace and workforce at all levels in your business is a competitive advantage. It’s important to not dwell on differences. Dwell instead on how to best engage this diverse workforce.
Start building collaborative relationships, finding ways to encourage more diverse thinking. Creating opportunities for employees of different generations to interact in both work- and nonwork-related settings can help to build relationships and minimize misunderstandings, creating opportunities for cross-generational mentoring. Don’t automatically assume that younger generations will be mentored by older generations. All age groups have opportunities to learn from one another. Consider the different life paths of your employees. Critical points for engaging them are understanding where your employees are at in their lives, learning their personal preferences, and recognizing how they expect to be compensated.
Technological advances, including AI, continuously change the employment landscape. Today jobs are not necessarily disappearing, but they are being augmented by technology. As technology becomes more affordable and mainstream throughout the vacation rental industry, it is changing the very nature of how we do our work.
Automation is now reaching into the office, making the way we work today look nothing like it did a few years ago. As machines take over mundane tasks, employers are expecting more complex, creative, and varied functions from their employees. Continuously review your technology solutions and automation to apply new technologies to streamline repetitive tasks. Online collaboration tools, shared drives, videos, YouTube, Facetime, Skype, Zoom, etc. are changing the ways employees get their work done.
The ever-changing nature of the employment landscape puts more pressure on employers when it comes to attracting and retaining employees. With increased competition and online reviews, customer expectations are going up, resulting in your customers seeking an authentic customer experience. They are shying away from generic customer service responses. Today’s customer expectations require your employees to deliver an authentic product and service experience. The focus now is on deciding how to best use AI to help your employees do their jobs better.
Scanning the environment is key to understanding emerging workforce trends. Listed below are several things that you as employers can do now to get ahead of this curve.
1. Create a compelling employee experience that attracts talent
Today millennials are looking for more than stability, competitive wages, and benefits to be committed to a company. They are driven by a sense of shared purpose. Understanding their part in the bigger picture is what drives them to bring their best to the workplace. By 2020, employee experience will be as important as any other factor for your company’s success. Figuring out the gap between what the millennial workforce expects and what your workplace has to offer is important. Millennials are all about convenience, connectivity, and functionality. Start by incorporating tools and technologies that enable their productivity.
2. Become the employer of choice in your marketplace
Employers of choice know what their competition is doing and how they stack up against the competition when it comes to attracting, engaging, and retaining talent. Today, employees are looking for a healthy workplace culture, opportunities for learning and growth, more interesting or challenging work, a variety of tasks, and of course more competitive pay, benefits, and incentives. To remain competitive you need to be offering more benefits, such as health insurance, 401(k) or savings plans, time off to volunteer, flexible schedules, and an ability to work remotely. Think about your business and focus on what will differentiate you as an employer of choice in your marketplace.
3. Embrace automation
Focus now on deciding how best to use technology to assist your employees with doing their jobs better. The World Economic Forum predicts that 42 percent of workplace tasks will rely on some form of AI or automation by 2022, although technology will play a big role in your team’s productivity, Deloitte’s 2018 Global Human Capital Trends report states that the most sought-after talents of future employees won’t be purely technical skills like coding or cybersecurity. They will be “essentially human” soft skills like creativity, communication skills, and complex problem solving. Embracing automation and using technology more effectively will free up your workforce to spend more time on innovation, collaboration, and business planning.
4. Train now for trending skills
By 2022 no less than 54 percent of all employees will require significant retraining or reskilling. Of these employees, 35 percent could require training for up to six months. Skills continuing to grow in prominence are emotional intelligence, analytical thinking, and innovation, followed by active learning and learning strategies. With the advancement of technology and AI in the workplace, employers will see a decline in roles that require skills such as manual dexterity, quality control, coordination, and time management and technology use (monitoring and control).
5. Assess your managers’ emotional intelligence (EQ)
Soft skills training is essential to developing your workforce, and at the top of the list is EQ. As Marcus Buckingham says, “People don’t leave bad companies, they leave bad managers.” Providing more training for your managers on soft skills, such as how to give effective feedback, setting smart goals, and dealing with conflict will go a long way toward improving your employee engagement and retention. Set your managers up for success. Your managers have the greatest impact on engaging and retaining your workforce.
6. Develop the talent you can’t find
The best employees are made, not found. Given the war for talent, you have to think differently about what the job is and who is going to fill it. Businesses no longer have the luxury of finding individuals with the skill sets and the talent key to their business, so retraining and reskilling current employees is on the upswing, focusing on the skills that are in high demand. Start by identifying the skills you need and the employees who are interested in learning them; then provide employees with the education assistance (and the time) to obtain the skills. The cost of reskilling is considerably lower than the cost of firing and hiring. Back to people analytics.
Understanding your cost of hiring and terminating is vital to developing your talent. For example, it may cost $6,000 to hire an employee or $3,000 to provide additional training and education for a current, engaged employee—to reskill that person so as to bring more relevant skills to your business. Investing in your employees’ development is a win–win.
7. Tapping into diverse recruitment pools is a must
Looking for talent outside of your normal channels and pipelines is important for successfully hiring talent in today’s economy. There are several disadvantaged groups to focus on, such as veterans (and military spouses), remote workers, disabled workers, family members reentering the workforce, and individuals with criminal records. Employers are now widening their search for applicants to consider candidates with criminal histories, as one in three adults (70 million Americans) currently have a criminal record. What types of criminal records are you as an employer willing to overlook? According to the Society for Human Resources and the Charles Koch Institute, employers are more likely to hire people with a criminal record of substance-related felonies and misdemeanors than those who have committed financial crimes or violent or sexual felonies. Employers are willing to consider candidates with criminal histories if they have good references, a solid performance record, and training in skills the employer is seeking, according to the report. Several states are starting to offer certificates of rehabilitation. Currently Arizona, California, Illinois, Nevada, New Jersey, and New York offer rehabilitation certificates or something similar.
To harness the potential of this future workforce, start by incorporating tools and technologies that will assist your employees in doing their jobs better. Focus on engaging and retraining or reskilling your current workforce. Developing a workforce culture that creates a sense of community—a sense of belonging and purpose—is essential to attracting and retaining talent today. Set your managers up for success with soft skills training. Providing training for your managers on soft skills has a direct correlation to business profitability, increased ROI, and engaging and retaining your workforce.