Recruitment challenges for 2023

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New industrial regulations, demand for flexibility on both sides, new skills needed and acute skills shortages…. 2022 offered some big challenges for HR and Talent Acquisition leaders, so what can they expect for 2023? Hays’ experts offer insights on the macro, economic, governance and market trends that may impact your workforce in the year ahead and how you can best prepare for these challenges.

From considering your attraction and retention strategies, to ensuring your employment contract can be personalised for individuals while remain fair to everyone, here are the top recruitment challenges for 2023.

Key trends impacting talent acquisition in 2023

1. Employees productive, but are they connected?

The question of if workers can maintain productivity while working remotely has been firmly answered in the affirmative, but how can you move beyond just getting the job done to building higher value in your workforce? The culture of your workplace will play a big part in this, however creating and embedding a culture within a hybrid workforce requires focused effort from leadership teams. Modern leaders engage with their teams with empathy and transparency to build trust. In turn, this trust helps build a place of physiological safety – a key ingredient for a culture that encourages people to be themselves and contribute from their unique point of view without fear of retribution or embarrassment.

Organisations will also need to focus on increasing employee engagement to keep staff motivated by highlighting the value they add to your business. Demonstrating a clear connection to the work they are doing , and how it helps organisations achieve their higher purpose, helps teams feel more fulfilled and engaged in their work. Further, upskilling team members and investing in their professional growth illustrates that the work they are doing is important to you and the organisation.

2. Contract work increases

With an uncertain economic environment, it’s predicted that employees may think twice before making big jumps for purely financial reasons, however we still predict that contract work will continue to be a requirement for employers.

As organisations continue to modernise, build agility and consider merger and acquisition strategies for growth, businesses will be looking to bring onboard specific skill sets for finite projects. An uptick in contract work means organisations will need to ensure their onboarding processes are refined to allow workers to get up to speed quickly and consider exit and alumni programs that allow organisations to stay in contact with workers past their completion dates. Tapping past contractors on the shoulder for future work opportunities means businesses can onboard them even quicker the next time around, and businesses can stay connected to in-demand skills.

3. Streamlining visa processes

At the end of 2022, the Labor Government announced a robust review of Australia’s immigration system. Additional to its promise to increase permanent migration levels by 35,000 in 2022/2023, the review is aimed at making Australia more competitive in the fight for global talent. With visa processing wait times reaching as long as 15 months, it’s harder for businesses to secure much-needed talent, especially in key areas of growth and shortages. The review may also consider abolishing the skills list and engaging more closely with businesses to identify where the gaps lie.

With a simpler, quicker visa processing system, businesses will be able to look more confidently towards overseas markets for the talent they need. Consideration should be given to any marketing efforts in new territories to attract the capabilities required.

4. Green skills in non-specialised roles

The continued push for a greener economy will mean that there will be an emphasis on all employees learning green skills to some degree to help participate in the green transition. Similar to the digital transformations we are currently witnessing across the globe, emerging technologies and evolving priorities are making it difficult to anticipate the specific skills that will be needed to meet the ambitious carbon cutting and Net-Zero pledges make by organisations, but this one is obvious – all workers will need to participate.

Organisations should review the roles across operations to identify which positions will be most affected by the transition and what upskilling will be needed, ensuring it’s aligned to the wider business ESG policies.

5. Changes to the Industrial Relations Bill

In Australia, the Secure Jobs, Better Pay Bill has passed and will have impacts for HR professionals. For starters, the ban on pay secrecy clauses in contracts means businesses will need to amend any contracts for newly hired employees. This ban has been implemented to lessen the risk of gender pay gaps by improving transparency.

Additionally, the introduction of multi-employer bargaining provisions has been created to attempt to reverse the decline in coverage of enterprise agreements and collective bargaining – engage with your legal team to identify potential risks.

6. Economic uncertainty

As economic uncertainty continues around the world, and many CEOs expecting a short and relatively mild recession in the next six to 12 months1, businesses will be looking for ways to navigate growth in turbulent times. This uncertainty could affect the labour market through hiring freezes and workforce resizing, while at the same time employees are more focussed on remuneration as cost-of-living pressures rise.

The RBA is predicting that the unemployment rate will rise to 3.7 per cent by the end of 2023, with some sectors impacted more than others.

7. Recovering from the fatigue

After two years of accelerated digital transformations, workforces are feeling the pinch of the pace of change. Yet a large number of CEOs are reporting that they will be investing heavily in digital capabilities in the near future.

As new digital tools have been implemented, attention now needs to be paid to ensuring these tools are properly embedded and that teams are engaging with any developments in meaningful ways. Driving core change management projects to support the workforce and building a culture where employees feel supported in their learning will be a key focus for HR teams. With the skills shortage still acute in the tech sector, it won’t necessarily be easy to buy in new technical skills, so talent acquisition managers should focus on finding employees that are keen to learn and happy to contribute to embedding and adopting new processes. Soft skills such as teamwork and willingness to try new things will continue to be important.

It will also be important to manage any cultural impacts these large changes may cause, paying close attention to signs of burn out and building meaningful programs to help manage the fall out.

Tomorrow is about opportunity, conquer these recruitment challenges in 2023 to set yourself up for success

If you’re planning to attract talent in 2023, addressing these challenges can help future proof your attraction and retention strategies and lead to an engaged and motivated workforce that will support your future vision.

If we can assist, please contact us.

About this author

Nick Deligiannis, Managing Director, began working at Hays in 1993 and since then he has held a variety of consulting and management roles across the business. In 2004 he was appointed to the Hays Board of Directors. He was made Managing Director of Australia and New Zealand in 2012.

Prior to joining Hays, he had a background in human resource management and marketing, and has formal qualifications in Psychology.

Follow Nick on LinkedIn

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