Employers are having trouble finding qualified talent to fill open positions.
Of the 82% of employers who report they are actively hiring for open positions, 80% are having trouble finding candidates, with 70% reporting a skills shortage, according to a survey by global outplacement and executive and business coaching firm Challenger, Gray & Christmas, Inc.
The survey was conducted over three weeks in May and June among 150 human resources professionals at companies of various sizes and industries nationwide.
"The tight labor market typically means workers have their pick of jobs,” said Andrew Challenger, VP of Challenger, Gray & Christmas. “This survey suggests that while opportunities abound, employers are looking for select skill sets and having trouble finding qualified talent."
Of those surveyed, 43% of employers reported that while they have plenty of applicants, those who apply do not have the requisite skills. Another 43% of employers reported that they are not receiving enough applicants, 27% of whom said the candidates who do apply are not qualified.
"This presents a difficult situation for hiring managers who need to fill positions. It's far more costly to hire someone who does not have the requisite skills and who will potentially only last a short time than to wait for the right person to come along," said Challenger.
The Challenger Survey found 83% of companies are hiring mid-level professionals, including supervisors and managers. Another 74% are hiring entry-level workers, while 61% are hiring for the director level to the c-suite.
When asked for which departments companies are hiring, 67% reported they were hiring in operations, while 53% are hiring in their sales departments. Half of respondents reported they are hiring in their HR departments, while 43% are hiring for their marketing departments.
"The high number of companies who are hiring HR professionals are likely responding to the increased need to manage talent in light of meaningful developments, such as #MeToo, as well as various state and federal regulations on what constitutes an employee, which benefits companies must offer, and what companies need to do to comply," said Challenger.
The majority of companies (71%) use an internal hiring function and employee referrals to find talent. The next most-used mechanism to find talent is LinkedIn, with 65% of companies reporting they use this site to find candidates, followed by Indeed with 56%.
"While an increasing number of companies use online tools to find candidates, it remains true that the single best way to land a new position is through in-person connections,” said Challenger. “Companies continue to use referrals and internal networking to find talent.”
In separate studies from Glassdoor and the Society for Human Resource Management (SHRM), the cost of hiring someone in the United States is around $4,000, according to Glassdoor, or over $4,100, according to SHRM's calculations, as well as nearly two months of lost time. The cost of turnover for that person could be up to six to nine months of the employee's salary, according to SHRM.
"Onboarding someone who does not have the necessary skills to operate in the position sets that person up for failure,” said Challenger. “The untallied costs include the cost to productivity and the hit to morale, not only to the person who is not up to the task, but also that person's colleagues, who now may have to work harder.”