People

Employee's market or employer's market?

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Over the last several years, we have grown accustomed to regular announcements by the Polish Central Statistical Office regarding the falling registered unemployment rate, which is currently the lowest it has been since 1990.

The media, both of the traditional and social variety, report that qualified employees are becoming increasingly difficult to find. We are bombarded with recruitment ads not only on dedicated websites, but also in many other areas of everyday life: in shops, on public transport, billboards and television. Employers compete to see who can offer the best benefit package. The average salary has also been on a steady incline. At first glance, this may suggest that we are indeed dealing with an employee’s market. Upon closer inspection, however, this is not comprehensive enough a description of the Polish job market.

WHERE ARE WE DEALING WITH AN EMPLOYMENT DEFICIT?

As always, the largest deficit can be found in the IT industry. According to various estimates, Poland needs nearly fifty thousand programmers – in comparison, Europe as a whole will soon need more than a million of them. However, employment deficits affect
other sectors as well, including construction, services, logistics and industry. The lack of employees can be felt on all levels, but is particularly troubling at the shop floor level and among mid-level specialists. Businesses wanting to increase production are hard-pressed to find experienced machine operators, electricians and mechanics to keep their plants running. The development of the SSC and BPO sectors is an opportunity for a large group of young people, mostly university graduates, to find work. Job offers are in large supply in many regions, which encourages employees to look for a new job and increases staff rotation. Attempts to fill the employment gap with immigrants are ultimately futile as they are fraught with procedural difficulties, and also due to the fact that most immigrants can stay in Poland for only a limited period.

CONSEQUENCES OF JOB MARKET CHANGES

The causes of this state of affairs are numerous: demographics, ageing society, rapidly growing economy, government social programmes, new foreign investments, education which does not meet market needs and the arrival of Generation Y on the job market. However, we should take a moment to think about one of the results, that is the changing approach to nearly all HR processes in companies. Recruitment is becoming less about headhunters racing with one another and is now more akin to selling a product: recruiters now not only have to verify candidates’ skills and level of engagement, but also build a relationship based on trust. Artificial intelligence and machine learning are no longer only confined to science fiction books, and have already become a fixed part of the HR sector. Employer branding experts communicate using the most popular media, tailoring their message to their target audience. Advanced onboarding activities make it possible to not only quickly implement new tasks, but also increase employee retention, particularly in the case of large-scale recruitment projects. Employment conditions are becoming more flexible, allowing for different forms of work, including the increasingly popular remote work. The declarative values of businesses are no longer just ink on a poster, and are actually being adhered to in real life. Is this the case everywhere, however?

UNEMPLOYMENT IS STILL AN ISSUE

The job market changes the fastest in large cities, where labour is in the largest supply. Large industry hubs are similar in this regard, as increasing production results in a natural increase in employment. Process automation is often very costly, forcing small and medium- sized enterprises to compete for employees. However, a quick look at official data is enough to realise that the low employment rates in highly urbanised and industrialised areas stand in stark contrast to other regions. The registered unemployment rate in Poland was 5.4% in July 2019, but in certain counties, that number was three to four times higher (Szydłowiec – 22.4%, Przysucha – 17.7%, Łobez – 18.6%, Bartoszyce – 16.4%). This large geographic discrepancy in unemployment rates between regions poses a heavy challenge for the government, but is also an opportunity for potential investors, who could certainly benefit from the large untapped supply of labour. The still-low domestic mobility of Poles can, paradoxically enough, be an asset in the case of areas which have so far been ignored by major investors. Geographic distribution is not the only distinctive feature of unemployment in Poland, with demographics being another key factor at play here. The unemployment rate among those under 24 years of age is twice as high (10.4%) as the national average. Even though it has been declining, it is still a clear indication that finding a first job is difficult. While the abundance of internship programmes dedicated for graduates does make it a lot easier to start a career, it does nothing to bridge the chasm between the skills offered by the education system and employer expectations. Those nearing retirement age may also find themselves in a difficult situation. Employers still believe in stereotypes according to which employees aged 50+ are less productive, preventing them from utilising their accumulated experience. Laws prohibiting businesses from dismissing employees a few years before retirement also make finding a new job more difficult.

EMPLOYEES AND EMPLOYERS ON THE MODERN JOB MARKET

The Polish job market has become incredibly diverse as a result of the shifting economy. This means that any claims according to which we are currently dealing with an employee’s market are unfounded. However, it cannot be denied that life has got significantly easier for jobseekers, especially compared to several years ago. This applies primarily to those with unique skills, such as people who speak several foreign languages fluently or specialise in niche areas. The changing
economy requires a totally different set of skills than in the past. Quick decision- making based on data analysis, comprehensive and creative solutions to problems, emotional intelligence and computer literacy have supplanted textbook knowledge and procedures. Developing these skills is what will guarantee employment in the future.

The current state of the job market poses a hefty challenge for employers, but it appears that businesses are ready to make the necessary changes. More flexible employment conditions and better work-life balance are their response to the expectations of the new generation of employees. Succession strategies make it possible to make use of the skills and knowledge of more experienced employees. Including all employees (not only the HR department) in employer branding processes increases credibility and helps increase the involvement of entire teams. The development of recruitment process outsourcing services offered by specialised providers can be a great help in achieving recruitment goals. The job market will continue to shift and change, but both employers and employees are capable of adapting.

Author: Damian Kurkowiak, Recruitment Manager RPO, Kelly Services