Hiring Strategy in Built Environment, Construction & Property
As we reach the end of the first quarter in 2019 and head toward Brexit, and with the publication of the 2019 RICS and Macdonald & Co. Rewards and Attitudes Survey it seems apt to consider how the demand and availability of surveyor jobs may fare in the weeks, months and years ahead. Our conclusion from recent evidence is that, despite uncertainty and a recent slowdown in activity, there is reason to be cautiously optimistic.
Surveyors Demand is High…
In its February 2019 Dataset, the ONS reported that there are a record number of vacancies in the UK. The figure of 870,000 advertised vacancies in the three months November 2018 to Jan 2019 is 5.6% higher than the 824,000 vacancies recorded in the corresponding three-month period a year earlier. In the construction industry, surveyors and other professionals are in demand.
The growth in professional construction jobs has outpaced the growth of jobs in the wider economy. The ONS reported 29,000 vacancies in the construction industry in the three months under review. This is an increase of 16% on a year earlier. In real estate activities, the growth in advertised vacancies has been even higher – the 15,000 vacancies reported is an increase of 30% on a year earlier. But recruiting surveyors is difficult In its Q4 Construction and Infrastructure Market Survey, RICS highlighted increasing workload but with capacity a constraint on the ability to deliver. A net 47% more surveyors need to increase headcount to support new work. However, there is a lack of available skilled labour that is making it difficult for firms to hire.
This shortage of skilled labour has also been highlighted by the Recruitment and Employment Confederation in its February UK Report on Jobs, published in collaboration with KPMG. Its key findings were that:
• Permanent placements fell for the first time in 30 months
• The growth of vacancies edged down
• A sharp fall in candidate availability has led to an increase in starting pay
The data that was analysed for the report – complied by IHS Markit from the responses given by around 400 UK recruitment and employment consultancies – showed that while the number of jobs advertised continues to grow, the number of candidates for them continues to fall. The RICS Construction and Infrastructure Market Survey summarised just how difficult it is to recruit skilled staff into professional services such as quantity surveying: half of those surveyed said that recruitment of skilled employees posed a significant challenge.
Your Challenge - Recruiting Professionals
The shortage of skilled labour versus the high number of jobs available is merely the headline reason employers are finding it difficult to recruit the staff they need. To fully understand the problem and therefore devise strategies to help hire and retain top talent, you must dig a little deeper and consider the underlying issues. One such issue at this moment is Brexit. It will become more difficult to hire talent from the EU. It may also make it harder to retain existing staff, as companies work harder to attract talent for the home market. Greater difficulty to hire from the EU may not be the elephant in the room that many consider it to be. For example, RICS found that almost two-thirds of companies expressed the view that EU workers were not important to their hiring requirements in the surveying profession. However, where Brexit is clearly having an impact is in the mindset of potential job movers.
Brexit has caused a heap of uncertainty, and when people are not sure of the future for their industry, they become reticent to take a leap of faith from one employer to another. It is clear there is a shortage of surveyors. This may in part be because of the effects of Brexit, but is also because of the legacy of the Great Financial Crisis, when the sharp fall in construction activity led to a reduction in investment in training and recruiting in the profession. Indeed, 68% of those surveyed by RICS in its Q4 Construction and Infrastructure Market Survey said that education is the most effective tool to address the skills shortage (only 15% said that the answer lies in addressing immigration).
Summing up, the main underlying issues affecting employers seeking to recruit skilled staff are:
• Negativity surrounding Brexit, particularly the hesitance of professionals to move employers
• Education, training and development of skilled employees
Will Demand for Surveyors Decrease?
So far, we have concentrated on the supply side. It must be said that when surveyors move, changing jobs does not narrow the gap between demand and supply – it simply shifts the demand. The real solution to the problem is to increase the supply of skilled labour by addressing the need to educate, train and develop people. This is a matter for government and training bodies externally (by providing impetus, encouragement, and opportunity for higher and further education leading to professional qualifications in the skills required), and for companies internally (by identifying, hiring and developing talent). In deciding on your hiring and RICS membership and career development strategies, the potential future of the construction industry is key.
In this regard, while so much Brexit-induced uncertainty is currently casting its shadow over the sector, and growth in new workloads moderated toward the end of 2018, the Q4 RICS Construction and Infrastructure Market Survey paints a picture of rising activity and an increase in recruitment despite difficult conditions. Here are the highlights:
• Housing market construction is growing The government has a target of building 300,000 new homes per year by the mid-2020s. Perhaps unsurprisingly then, private housing activity is still growing. While evidence suggests that the market has slowed amid negative sentiment, 20% of respondents reported a rise in private housing activity.
• Public sector workloads are mixed Surveyors reported faster growth in housing, but a slowdown in non-housing activity. It seems likely that the housing sector has been stimulated by the £1 billion extra HRA funding of new council houses.
• Infrastructure activity is stable and growing The net balance of 18% reporting increased activity was down only slightly on the Q3 survey. Specifically, growth in roads, rail and energy has been resilient, following the go-ahead from government on major projects such as Hinkley Point C, HS2 and Heathrow. A net 10% of companies reported an increase in new business enquiries.
• Construction companies expect activity to rise There is little doubt that we are amid challenging times.
Brexit - Weighing on Sentiment
The EU economy is slowing, as the ECB’s removal of its massive QE programme starts to bite. The global economy is slowing, reacting to geopolitical events and Trump’s trade battles. With such a backdrop, it is not difficult to understand why optimism in the construction sector declined between the third and fourth quarter of 2018. Even so, a net balance of almost a quarter (24%) of those surveyed expect activity to rise rather than fall. Accompanying this will be more hiring, with 15% expecting an increase in hiring.
Hiring Skilled Surveyors May Become Easier in 2019
The good news for good employers (and bad news for those that are not so good) is that the 2019 RICS and Macdonald & Co. Rewards and Attitudes Survey indicates that it may become easier to attract the skilled surveyors that your business needs to compete in a growing but challenging market environment, and despite companies expecting to hire more staff.
The survey found that 37% of its 3,461 respondents are either likely or very likely to move jobs in the next 12 months. This should increase the supply of talent, thus making it easier to fill the roles you need to fill. However, easier doesn’t mean easy. Employers will need to offer the right challenge, salary and benefits, as well as other qualities to make the opportunity both attractive and worthwhile.
How To Attract Surveyors You Want to Hire
The RICS 2019 Salary Survey provides plenty of clues as to how you might attract the talent you need, by providing valuable data across three areas:
- How valued do people feel in their current role, and why?
- What is it that dissatisfies people most about their job?
- What are the biggest influencing factors when people are considering a new role?
Let’s look at these in turn.
1. How Valued People Feel in Their Role, and Why?
When asked this question, more than half of respondents said they felt valued in their role. However, and perhaps worryingly, almost one in five (19%) felt unvalued or very unvalued. The main factor in why people either feel valued or not valued is the salary they receive, with 100% of respondents citing salary as a factor of value. However, there were many other factors, too:
• In second place, 90% of respondents stated that work/life balance impacted how they felt about their current value to their employer
• Soft factors such as appreciation by line managers, colleagues and senior management also ranked highly
• The level of bonus was cited by 69% as a contributory factor
• Workplace culture (such as politeness and being listened to) and personal development and training opportunities also polled more than 50%
These responses tend to suggest that while satisfactory remuneration is the key requirement to make your people feel valued at work, there is increasing emphasis on the softer side of working life. Those companies that provide their employees with a good work/life balance and provide a culture of appreciation with opportunities for training and self-development tend to make their employees feel more valued – and this is crucial to staff retention.
2. What Dissatisfies People Most In Their Job?
Employers who want to retain their best people also need to understand why it is that those people might want to leave. To answer this, this survey prompted respondents to say which factors would make them most dissatisfied at work. The responses provided further evidence of the trend of employees toward seeking jobs that provide a good work/life balance. While 24% of respondents cited having to work out of hours, most (53%) appear to accept the occasional need to do so. However, when it came to an employer’s demands for people to work at weekends and during their annual leave, the response was far less understanding:
- 49% of respondents felt having to work weekends was most impactful on their dissatisfaction at work
- 47% felt having to work during annual leave was most impactful on their dissatisfaction at work
- 31% said that a lack of line manager recognition would impact them most
With regards to the financial side of the equation, 46% would be most impacted if they did not have an annual salary review. Only a quarter said that a lower bonus than expected would cause most impact on their level of satisfaction at work.
3. The Biggest Influencing Factors When Considering a New Job?
The final piece of the puzzle when devising hiring and staff retention strategies is to understand what it is that candidates really want. What is it that makes them choose you over your competition, and persuades them to leave their current role? Perhaps unsurprisingly, the number one factor in the decision-making process is salary – would you expect someone to consider the role you are offering if you offered a lower salary than their current salary? Other deciding factors include:
- Location. People are more likely to want to work either within easy travelling distance, or in a location that appeals to them.
- Opportunities for career progression, personal development, and with increased responsibility also rank highly as reasons to move.
- More than half of respondents desire flexible working, the potential to earn bonuses, and to work for a good leadership team and manager.
- 60% of respondents cited job security as influential.
- 59% cite quality of work as important.
Finding your next talented hire In a market in which skilled employees are increasingly difficult to find, it pays to know what it is that influences people to join you. The RICS Macdonald & Company 2019 Salary Survey provides a fascinating and meaningful insight into the current and future thinking of professionals working in the built environment, construction and property sector. The kind of insight that will help you as employers position your vacancies to attract the best talent.
For more information about how Macdonald & Company can help you with your requirements for skilled employees, get in touch us the recruitment team today.