Growing flexibility in the labour market
For HR, these changes represent both opportunities such as being able to outsource work and reduce costs, and challenges, especially relating to retention and succession planning. The latter in particular is creating a headache for many organisations, and has been identified by the non-executive directors in this study as the number one HR priority for the next five years. It will be a difficult balancing act for HR to retain and develop key individuals so that crucial positions can be filled in the future, while at the same time taking advantage of the benefits of more flexible workforce constructions which undermine long term commitment to a single organisation.
Despite increasing flexibility in the labour market, the share of HR leaders who expect this trend to have a high or very high impact on their business has dropped from 29% in 2015 to 17% in 2017. Perhaps this is due in part to organisations already leveraging contingent workforce as an established business practice. It could also be related to public scrutiny and criticism of zero hour contracts and to changing definitions of what it means to be a contractor, an employee, or a worker, which may make flexible labour less appealing to some employers.
“The nature of jobs shifts. The nature of careers changes. People have several careers over a lifetime, they don’t just have one or two, and that has changed within the last twenty or thirty years.”
Chris Burns, HR Director, Neopost
“There is much more of a portfolio approach to employment. Many organisations will have a core
group of permanent employees, a number of almost permanent consultants, a number of contractors who may or may not work exclusively for the organisation, and then the temporary labour that they switch off and on.“
Jo Easton, Group Director of Human Resources, De La Rue
“For the vast majority of the workforce I think there is, again, this focus on experience. So it is about the quality of the work that you do, the degree of autonomy that is afforded to you, the degree of training, the diversification in terms of where that could take you, so this whole idea of portability and being a good employer might mean that actually you’re not trying to hold on to somebody forever but you are trying to ensure that they have a really positive experience, at the same time contributing very positively to the health, performance, and wellbeing of the organisation, so it is a mutually beneficial exchange that doesn’t last forever and nobody is hurt when it doesn’t.”
Liz McMeikan, Senior Independent Director, JD Wetherspoon plc
“One trap for HR is to focus entirely on employees, when in a modern workforce there will be a broad spectrum of contractors, consultants, service providers and employees. Talent, and the culture which nurtures it, needs to be managed across this whole pool of people.”
A Non-Executive Director of multiple public sector organisations
In similar vein to comments concerning staff retention, many developed economies are recognising the difficulties experienced by both male and female workers when it comes to balancing the demands of home and work, including caring for the old and young. At the same time, a growing number of older workers, unable to afford to retire, are looking for flexible ways to continue working, while some younger workers are reluctant to commit to the traditional full-time employment model.
These pressures are resulting in some governments introducing new workplace rights to take leave and request flexible working arrangements (although this is still developing in Asia). In Asia, however, certainly in the professional sectors, employers not already operating such policies may struggle to recruit and retain even if they do not have any legal obligations to offer flexible work.