With a diminishing talent pool, employers need to rethink the workplace to retain staff
Will Kinnear, Director at HEWN comments: “The UK’s workforce was called back to the office, to return to business as usual for the start of the ‘school year’; for some this has been a welcome move, but for others, they have enjoyed the freedoms of flexible working and the work/life balance it brings. Savvy employers have capitalised on this, a lower headcount in the office has meant less square footage – which is a capital gain; even savvier employers have realised flexible working is a work-perk attracting the best talent.”
The ONS reported earlier this month that unemployment fell to 4.6 per cent in the three months to July – from 4.7 per cent a month earlier. It also showed that employment rose to 75.2 per cent. At the same time, data from HM Revenue & Customs showed payroll employment up by 241,000 in August matching pre-pandemic levels. However, the number of vacancies hit 1.034m in the three months to August, the first time it has surpassed the 1m mark since the ONS started monitoring job advertisements 20 years ago.
“What this data shows us” says Kinnear, “is that there are more jobs than there are workers. There is a shift in the balance of power, employees are now able to exercise this power by walking if their current job doesn’t meet new flexible working requirements; or, more favourably for employers, stay but flexing their employment contract to reflect the new culture of work. Flexible working is here to stay, make no bones about it.”
The Scottish Government is still encouraging employers to support working from home where possible to control the virus; with many employers adopting a hybrid model to accommodate flexible working. The English government are recommending a “gradual return to work”, similarly in Wales where it is a prerequisite for employers to undertake a risk assessment and put reasonable measures in place.
“A discussion being had across all executive and HR teams up and down the country is about the talent shortage and the vital need to retain staff; increasing wages is the obvious way to do this, but this isn’t a sustainable long-term strategy for businesses; though culture change, flexibility and what the workplace offers is. With furlough soon to end, I suspect we will see a lot of staff movement as employees have had time to find a package that suits their needs and demands.”
Vacancy rate in the London’s West End according to Statista (2021) rose to 7.1% in April (from April 2020 – 4.3%); at the same time Savills reported 88% of leasing activity over the last year has been of Grade A quality in the Central London’s market. “It’s easy to say that offices are being ‘abandoned’, but what we are really seeing is a shift of how we view the office: it has become a destination as opposed to just four walls with a desk. This is also a strategy from the c-suite to make being at or going to the office more desirable; it has become part of the package. We have seen numerous businesses leave their Grade B offices behind in favour of flexible workspace within Grade A developments or use flexible office providers which help entice employees into the office with their hospitality offer, also helping to increase staff morale and productivity.”
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