There has always been, will always be, an element of tension between compensation and recruiting. Recruiting pros want to bring in the best candidate and offer the package necessary to make this happen -- with their compensation colleagues often functioning (in their eyes) as the biggest obstacle to achieving this end. Compensation pros often feel they are the last line of defense for the integrity of the pay program, seeing their recruiting counterparts as wielding the wrecking ball that will bring the delicately balanced house of cards tumbling to the ground. I hold to the opinion that its a healthy tension, and I particularly appreciate the position of those in HR whose role demands that they perform and balance the objectives of both functions.
Today's talent market is a particularly challenging one, demanding that we who design and manage rewards step out of our comfort zones and explore the new practices and solutions necessary for our organizations to purchase and hold on to people with the necessary skill and competency sets.
Steve Boese -- Co-Chair of the HR Technology Conference, creator and host of the HR Happy Hour Show and my favorite HR Tech blogger -- wrote a great post this week driving home some critical points about today's talent market, from a recruiter point-of-view. In his post, Steve shares a striking chart (see below) about the degree to which (over the past few years) candidates or employers are in the driver's seat, compiled as part of MRINetwork's biannual Recruiter Sentiment Survey, which features the responses of 235 recruiters.
The chart shows us that this group of recruiters are reporting a dramatic shift in terms of who holds the power and leverage in the marketplace for talent. Related to this power shift, the survey also reports the following highlights and observations (with my comments in parentheses):
More than ever, highly skilled and top performing candidates are in demand. It is sometimes difficult to communicate this fact to hiring managers and other company stakeholders (including, I suspect they mean, the compensation department).
Candidates have more options than they have had in years. Yet companies still want to give low-ball offers. (A function of policy and internal equity considerations that push hiring in the lower half of the range, perhaps? Managers that are out of touch with labor market reality?)
Some companies are not adjusting to this market change and, as a result, dragging out the process and losing good candidates (probably struggling internally to find a compromise that will land the desired candidate without upsetting the internal equity applecart).
It isn't my intention to paint compensation as the bad guys here, or our efforts to manage compensation as unnecessary. (And I do realize that recruiters bring their own issues to the table.) Too often, we are stuck feeling like the little Dutch boy with his finger in the dike, hoping to stall the flood waters. Mostly that's probably legitimate, but sometimes we may be trying to hold back necessary change and progress in our pay practices and solutions.
At any rate, I think it's always helpful to get a glimpse into what our colleagues on the other end of the talent management train are dealing with.
Ann Bares is the Founder and Editor of the Compensation Café, Author of Compensation Force and Managing Partner of Altura Consulting Group LLC, where she provides compensation consulting to a range of client organizations. Ann and fellow Compensation Café writers, Margaret O’Hanlon and Dan Walter will soon be releasing a new book on communicating compensation - stay posted! Ann serves as President of the Twin Cities Compensation Network (the most awesome local reward network on the planet) and is a member of the Advisory Board of the Compensation & Benefits Review. She earned her M.B.A. at Northwestern University’s Kellogg School, is a foodie and bookhound in her spare time. Follow her on Twitter at @annbares.
Creative Commons image "Fault Line in Þingvellir National Park" by Jon Connell