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In the wake of the Great Resignation making waves in the industry, half of managers say it’s time for the Great Reskill.
Businesses are warned against premature promotions and pay rises, as a new report revealed that both employees and employers might lose out in the long run.
A Royal Melbourne Institute of Technology (RMIT) study has found that almost half of managers, or 46 per cent surveyed, felt they needed to overpromote and overcompensate new hires in the last year, hamstrung by the talent shortage and high expectations from candidates.
Concerningly, 40 per cent of the respondents believe they had hired candidates who didn’t have the skills or experience necessary for new roles.
Data also found that 35 per cent of managers and a quarter of non-managers say the new hires have the highest salaries for their positions, which can cause internal friction.
RMIT Online interim chief executive Claire Hopkins said the high job market competition is causing companies to speed up career progressions, as well as hiring processes.
“A tight job market means many companies are more open to fast-tracking careers or hiring professionals with fewer years of experience,” she commented.
And while in itself, this does not constitute an issue and can even help in scouting and retaining talent, she stated that businesses must complement the process with the right support and training to set up the employees for success.
She added that leaders have to understand the issue better not only to support new hires but also to avoid increasing attrition among the current employees.
“The talent shortage means retaining team members is critical. Companies must ensure they are actively putting strategies together to prioritise their employer value proposition — whether this be through remuneration, or providing on-the-job or formal training opportunities to help staff realise their potential,” she explained.
The report also found that one in three managers, or 34 per cent, who moved to a new company in the past year were concerned that they didn’t have the right skills, indicating that employees recognise they need training in areas such as data analytics, digital literacy and leadership.
This concern is translating into more employees looking to jump ships, with almost 40 per cent stating that they are actively looking for another position after just months in the new job.
According to the survey, there are reasons why managers and employees are stepping into new roles despite feeling unprepared.
Not feeling valued by their employers was cited by 57 per cent as their main reason for moving into a new work, while 51 per cent believe they are underpaid for their current role or level of responsibility.
The rising cost of living is also causing employees to search for what they believe to be greener pastures. Over 85 per cent of those surveyed say rising inflation makes financial compensation more motivating and critical now than a year ago, increasing the likelihood of moving for a better pay cheque.
The research revealed over a third of workers changed jobs in the past year for better pay, with 61 per cent changing work coats for a pay increase of less than $10,000 a year, and 28 per cent for less than $5,000 annual pay increase.
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