Skills shortage threats

Singapore’s successful navigation through the global financial crisis has enabled a sharp economic recovery. What this brings, however, is a rise of issues such as attracting and retaining talent, and expectations of better remuneration packages – posing a great leadership challenge for organisations. That’s the verdict of the annual World of Work report from global recruitment and HR services company, Randstad.

With total employment on the increase, 2010 has already brought the return of critical skills shortages. Singapore employers are again competing in the war for talent.

26% of respondents believe the biggest challenge for the next year will be attracting top talent, while retaining talent is seen as the next major leadership challenge.

The single biggest workplace challenge in Singapore will come from increased turnover creating vacancies (36%) and the realignment of job roles to match business needs after the downturn (31%).

The report highlights a fundamental risk to Singapore’s return to economic growth. Urgent action is needed to address the issue of attracting the right talent to alleviate critical skills shortages in this country.

As the economy continues to improve and employers gain greater hiring confidence, we will inevitably see a tightening of the skills market, as “hungry” employees seek greener pastures. What is concerning for a large number of employers is searching for the best talent to help fuel the renewed economic growth.

Singapore’s navigation of the global financial crisis has been highlighted as an example of economic resilience and sound fiscal management. But this hard work could be wasted with three key forces now at play: a lack of employees with the skills required by businesses, an ageing population impacting on the availability of talent, and the misalignment of skills-sets due to the changing business environment following the restructures of last year.

68% of surveyed organisations rate their ability to attract talent as “strong” or “fair”, and this is driven by strong company reputation and brand (44%). Attracting the right talent has always been a priority amongst Singapore businesses, and visionary leadership and effective communication will continue to play important roles.

37% say the biggest focus of their employer brand is to reinforce their employee value propositions with both current and prospective employees, and 48% of respondents believe the most important attribute of effective leadership is the ability to create and share an engaging vision for the future. 79% rate their leader’s ability to communicate a strategic vision “highly”.

While 23% of employers think the main reason employees are motivated to stay is salary, 23% of employees say they are also motivated by a strong understanding role that contributes to organisational goals. What is encouraging is that 67% of employees are either “happy”, or “very happy” in their role.

So as many organisations across Singapore quickly steady themselves following last year’s unprecedented change, the role of HR is back in the spotlight with effective people and leadership strategies critical to business growth. As competition for talent heats up, the most successful practitioners will win through effective change management, a focus on workforce productivity, and by leading the market in creative talent attraction, engagement and retention strategies.

For insight into the burning questions driving this year’s HR debate, request a copy of the Randstad 2010 World of Work report by visiting www.randstad.com.sg.