Skills Shortages a Major Hiring Obstacle
25th March 2024
Eight-five percent (85%) of Irish employers think skills shortages will impact their hiring plans in 2024. Indeed, over half (57%) of employers have stated that they are already finding it harder to attract and retain staff this year.
The findings come from a new poll of 2,000 Irish employers and professionals conducted by specialist recruitment company Robert Walters.
Suzanne Feeney, Country Manager of Robert Walters Ireland comments: “Off the back of what proved a difficult year for many, hiring in 2024 is not without its challenges.
A combination of key skills shortages, raised salary expectations and high competition means Irish employers must be more dynamic and fast-moving than ever.”
Raised Stakes and Expectations
When asked about the key factors contributing to their difficulties in hiring and retention – two-fifths (42%) of Irish employers stated ‘too high salary expectations’.
Other contributing factors cited were higher competition for talent (38%) and a lack of diverse talent (19%).
Suzanne elaborates: “Over the last 18 months, the cost of living as well as inflation has shot up – however, the global economic turbulence has meant for many, salaries haven’t risen accordingly.
“Add to this the fact competition for talent – especially in-demand talent – is at an all-time high and you can begin to see clearly why employers feel they are out of bargaining chips when it comes to attracting and retaining the best talent.
Continued Skills Shortages
Skills shortages have been widely reported across the Republic in many different sectors including IT, Production Management, Engineering and Business.
85% of Irish employers think that skills shortages will impact their plans to hire this year.
60% of Irish employers plan to respond to skills shortages by upskilling their staff – whilst further techniques they plan to implement include diversifying talent pools (20%) and skills-based hiring (20%).
Suzanne acknowledges: “There has been a coalesce of factors contributing to the current skills shortage we are seeing in Ireland – from the raised cost of living and accommodation pricing younger professionals out of the republic and triggering a brain drain of younger talent to cost cuts meaning employers are not only streamlining operations but have less bargaining power to attract in-demand talent.
“Moreover, the lack of diverse talent pools is a persistent issue, with the gender pay gap still proving a major source of contention, resulting in a lack in representation of female workers in many professional services sectors.”
The Gender Pay Gap
In Ireland, the gender pay gap in Finance, Insurance and Real Estate sectors sits at almost a quarter (24.7%) – well above the national average of 9.6%. (source). However, the EU Pay Transparency Directive is set to change this.
Currently companies here with 250+ employees have to report their gender pay gap and the scope widens this year to include 150+ employees. In 2025, it will be 50+ employees.
Those with gender pay gaps of 5%+ will trigger joint assessment procedures, with the potential to incur fines from the Government.
When asked how they felt about the upcoming regulations, 86% of professionals stated they felt it will have a positive impact on hiring in the Republic.
Suzanne says: “The directive is not only providing more transparent and clear reporting on company’s pay gaps but will also enforce more checks and penalties on companies who aren’t working on making improvements.”
“This is why it’s important for employers to keep a finger-on-the-pulse right now to appeal to a significant portion of untapped, female talent who may be more attracted to move into the market.”
Suzanne concludes:
“The current market conditions require employers to be innovative with their hiring plans to attract in-demand talent – focusing on appealing to diverse candidates, upscaling what they can offer outside of inflated salaries, rolling out upskilling inventions within their existing workforce and keeping abreast of new gender pay gap legislation.
Ways employers can boost levels of attraction and retention:
Optimising your EVP – having an effective Employee Value Proposition is more important than ever and one of its cornerstones is promoting the right culture. This includes offering mentorship and learning and development opportunities to show your culture as one dedicated to upskilling your workforce.
Upscaling Benefits – health-focused benefits such as apps that help employee track their health, free or subsidised health screenings or therapy sessions, and flexible working to aid work/life balance are high on the list.
Routes to Progression – if professionals see that you’re investing in them they may opt to work for you for the long-term earning and progression opportunities, over a short-term salary bump.
Commitments to Equality – committing to business-wide equality targets can help make your company seem more accessible for diverse talent. However, opting for achievable goals that your company can achieve is key e.g. by 2030 your senior team will have a 50:50 gender split.
