The phrase “War for Talent” was coined in 1997 and refers to the challenging landscape around attracting and retaining talent. That was 30 years ago. Today, it’s not just challenging; it’s positively arduous and complex. Most companies invest heavily in compensation and benefits in an attempt to recruit and retain the best people, but the competition remains fierce. It’s becoming more and more difficult for organisation to hire, despite the higher pay and expensive hiring gimmicks.
“Most companies invest heavily in compensation and benefits in an attempt to recruit and retain the best people, but the competition remains fierce”
Some argue that there is an undersupply of talent. Case in point, when Walmart launched a new Washington, DC, store in 2013, it received 23,000 applications for 600 positions. Statistically – it was harder to get entry-level work there than to be accepted by Harvard (2.6 per cent of Walmart applicants made it through, as opposed to 6.1 per cent for the Ivy League universityi). Instead, it is about attracting and retaining the right type of talent.
Closer to home, employers in Asia are currently engaged in ‘an unsustainable bidding war’ according to a recent survey of more than 1,000 employers across Hong Kong, China, South Korea, Malaysia, Singapore and Taiwan. More than 90% of employers in the region admitted facing difficulty in recruiting and retaining talent – with an inability to match candidates’ salary expectations cited as the main reason for struggling to fill jobsii.
“…while the monthly pay is an essential factor, it makes the relationship between the employer and employee very transactional.”
But while the monthly pay is an essential factor, it makes the relationship between the employer and employee very transactional. An employer needs to understand what the employees’ financial goals are commensurate to their expected salary. Because the reality is, the workforce is made up of diverse set of individuals with varying goals and needs. An employer needs to understand that money alone isn’t enough, it needs to provide the employees the right tools so they can manage their wealth more proactively.
Obviously, from an organisation’s perspective it would be easier for companies to issue across-the-board compensation increases. But that would not be sustainable; a more cost-effective way is to think out-of-the-box by helping employees make each dollar earned more efficient. To do that, HR managers need to rethink their employee benefits package to include wealth management options.
Wealth management is often looked at as something that is reserved for a premium segment and not an employee benefit. However, with the availability of robo-advisors, HR managers are empowered to provide their employees with digital wealth experiences. This can be a differentiating factor allowing employees to build on their wealth instead of just drawing salaries. Imagine the pitch – “We’ll pay you a competitive salary, but also give you a financial management tool to ensure you’ll be able to do more with what you earn.”
For example, on our CONNECT platform, employees are supported at every stage of their financial goals with flexible risk allocation – in-line with our goals-based investing approach. Also, our minimum investment deposit of only USD1,500 USD empowers employees to take control of their wealth, shifting the responsibility and costs from the employer to the individual.
Will this ‘secret weapon’ win the war for talent? Probably not. However, it’s definitely an edge for companies looking out of the box.
- iAshley Lutz “Applicants for jobs at the new DC Walmart face worse odds than people trying to get into Harvard,” Business Insider, November 2013
- ii‘Talent resourcing and retention in Asia’ by the CIPD in partnership with the Hong Kong Institute of Human Resource Management