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Competition for talent is greater than ever across all sectors reveals annual CIPD/Hays survey.

Public sector organisations face increased problems in recruiting and retaining staff, particularly at a senior level, as skilled individuals shy away from the sector as the impact of the cuts is felt and the image of the sector wanes. These are the top line findings of the annual Chartered Institute of Personnel and Development (CIPD)/Hays Resourcing and Talent Planning survey of more than 500 employers.

Despite the high unemployment rate that will be updated in this morning’s official unemployment statistics, 82% of all organisations surveyed reported difficulties in filling at least some vacancies over the past few months. This figure has increased since the 2011 survey, with the biggest rise coming from public sector organisations (where the 2012 figure is also 82% compared to 66% in 2011).

Recruitment of managers and senior level staff within the public sector is a particular problem. 38% of public sector organisations surveyed reported that it was especially hard to fill vacancies at manager and specialist levels and a further 19% reported problems with finding candidates for senior manager and director level roles. Pay freezes coupled with a perceived reduction in benefits as a consequence of pension reforms may be responsible, as 43% of public sector employers cited pay as one of the reasons for their difficulties.

The public sector was also almost three times more likely (24% compared to 9%) than private sector services to report that the image of the sector/occupation/organisation was a problem in terms of attracting new recruits. This comes as large public sector employers are reporting more vacancies compared to this time last year (median number of vacancies in organisations with more than 5000 employees, 2012 survey: 275; 2011 survey: 150).

A lack of specialist or technical skills continues to be the biggest reason cited for recruitment difficulties across all sectors, with 71% of organisations also highlighting that there has been an increase in applications from unsuitable candidates. Despite the sheer weight of application numbers due to high levels of unemployment, three-fifths of organisations report that competition for talent is greater now than it has ever been.

Alongside recruitment, retention of employees has also been an issue, with two-thirds of organisations reporting problems. Despite on-going austerity measures, retention challenges appear to have particularly increased in the public sector, with managers and professional level staff reported as the most difficult to retain (40% reported this as an issue compared to just 25% in 2011).

Rebecca Clake, Research Adviser at CIPD, says: “Headlines focus on high levels of unemployment and public sector cut backs, but those stark statistics mask an ongoing struggle for employers to find the skills and experience they need to drive their organisations forward. This is a particular issue in the public sector where, now more than ever, they require talented and experienced individuals at senior levels of the organisation to help steer them through times of change.

“The image of the public sector is putting off some new recruits. This, coupled with widespread pay freezes and pension reform, makes jobs in public sector organisations less and less appealing to those individuals who have the skills required for the vacancies.”

Barney Ely, Director at Hays Human Resources, says: “As this year’s report shows organisations across the UK are faced with a fundamental challenge to attract and retain top talent, and this is acutely felt in the public sector. It is therefore critical for organisations to understand the recruitment trends within the UK, the marketplace and their organisation and to delve into the complex dynamics between them.  By attracting and retaining the best talent, organisations of all sizes and from all sectors will be best able to achieve their objectives. “

Additional findings from the survey include:
• On average the number of permanent vacancies organisations attempted to fill in 2011 remains much lower than before the 2008 financial crisis.
• Half of the organisations surveyed report that the economic climate has had a negative impact on their organisation’s resourcing budgets for 2012/13 with the public sector most likely to report reductions.
• Over a quarter of organisations report they will be reducing the number of new recruits they hire in 2012 and a fifth (19%) will be implementing a recruitment freeze. At the same time, however, more organisations report they will be recruiting for key talent/niche areas in 2012 (60%) compared with 2011 (50%).
• Half of organisations report that the current economic situation has led to an increased focus on talent management. There is more emphasis on developing talent in-house (2012: 70%; 2011: 43%) and more time and effort being spent investing in the quality of candidates hired (2012: 53%; 2011: 33%).

View the CIPD/Hays Resourcing and Talent Planning survey