It’s not about the money, money, money
Nick Cole explores the role of reward in recruitment and retention in a ‘candidate-driven’ market.
I recently heard it said that in a candidate-driven market, the organisation should be informed by pay but not entirely beholden to it. I know that this is easier said than done in the current market conditions. As I have said before, the combination of a war for talent in local government and private sector pay inflation, has created hiring conditions where the best candidates have choice for the first time in years.
And this is not just in the traditional local government hard-to-fill areas of social care, planning, legal, finance and highways. It’s across the board, from entry level management roles to the chief executive. IR35 hasn’t helped as senior interims re-enter the permanent workforce, nor has the significant increase in demand for candidates with the regeneration experience needed in every borough in the land to deliver the growth required of us from government.
A candidate-driven market, unlike a job-driven market, is where there are more available roles than talent. While at first sight this should excite the recruitment industry, the reality is that the appointment process can be tougher, longer to deliver, with shorter shortlists and a greater likelihood of non-appointment because of ‘buyback’ or candidates choosing one opportunity over another.
So, how important is pay in all of this? On one hand, the harsh reality is that if two authorities are recruiting to an identical role at the same time, why would a candidate pick one over the other? Clearly there is a need for one organisation to build a more compelling case to go there than the other. Creating a strong employer brand is a big part of this, but reward is also a factor whether we like it or not. Market supplements can be used but often cease to have validity after a while and don’t always work as a long-term retention tool. Keep track of regional pay rates by all means, but remember that market supplements are sometimes only a short-term sticking plaster for wider issues around attraction, retention and staff development.
In part, I’ve given some ideas on how not to be entirely beholden to pay, but not perhaps the definitive answer? What therefore if the organisation took a more holistic and long-term view about their workforce and ground this in branding, attraction, recruitment, learning, development and employee benefits; the full candidate life-cycle from ‘hire’ to ‘retire’? In Capita’s People Solutions division, we, along with colleagues from our employer branding, talent insight, learning services and employee benefits businesses are helping customers understand how recruitment, learning and benefits interact to deliver a high performing workforce.
From my recent experience and perspective in local government, more important than pay per se is culture. While some organisations have gotten a lot better at removing internal silos and working collaboratively across the whole system, there still remain some elements of occupational segregation, underpinned by historic pay structures.
Attracting, retaining and developing people on the basis of behaviour, values and organisational fit is perhaps a more effective way to respond to the current market conditions. This minimises the significance of remuneration in the mind of applicants and differentiates the organisation. It’s also a great way to understand team fit and development needs, improving retention and reducing hiring costs. Believe me, there are people out there who will put corporate culture, organisational values and council ambition above pounds, shillings and pence alone. Be different and you will get something different.
First published in the Municipal Journal.