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5 New Recruitment Trends for 2021

  • by: Adrian Mansfield
  • On: 4, Jan 2021
7 min read

Whilst recruitment trends change every year, Covid-19 has ensured 2020 will mark a moment of significant transformation in employment history.

With millions left without work and companies on the brink of collapse, 2021 will begin with a mountain of challenges – and opportunities – for the business world. From Brexit and IR35 to employee engagement, here are five ways that hiring will change in 2021.

5 Ways Hiring and Employment Will Change in 2021

1. Brexit – International Employment

With a No Deal looming on the horizon as 2020 draws to a close, the eventual outcome of the United Kingdom leaving the European Union will inevitably spell significant change for recruitment, for better or worse (or possibly both).

Although 1 in 4 UK businesses currently employ European staff, over half of British business leaders would be put off employing someone from the EU in the future due to potential changes in immigration laws. For these organisations, business growth will be supported by increasing staff retention through training and development, benefits and rewards and providing a positive overall working experience, in addition to honing in on previously untapped UK talent pools.

However, for some businesses in the Aerospace & Aviation, Automotive and Engineering sectors, losing out on EU contractors and permanent staff is not an option. From 1 July 2021, EU citizens and any family members living with them must hold or have applied for UK immigration status to legally work in the UK. With stricter rules around the right to work, hiring managers and recruitment agencies will need to work harder to attract EU candidates. Compliance departments will need to work with HR teams to adapt candidate screening and selection processes to comply with new editions of immigration law in the next three years.

In 2021, Human Resources teams, department managers and Board Directors will collaborate to adopt a longer-term talent attraction strategy that both retains existing talent pools and plans for international recruitment needs in the coming decade. Tighter regulation will encourage companies to work much more closely with their recruitment agency suppliers to build a full workforce management solution.

VHR Workforce Solutions provided specialist managed service solutions to reduce recruitment costs and increase efficiencies and compliance – find out more about our award-winning managed services.

2. Focus on Personality and Soft Skills

Whilst soft skills have been under the microscope in recent years as businesses increasingly seek out effective people managers and communicators who can work well with colleagues, clients and suppliers, 2021 will see soft skills and personality play a pivotal role in hiring strategies.

Video interviews and online assessments leave little room to understand body language or connect in a meaningful way with a potential new recruit. Hiring managers and HR Directors will devise new ways to accurately assess the character and personal qualities of candidates. Personality tests such as Myers Briggs and tasks based around problem-solving and idea generation will help recruiters get the best glimpse into the potential working style, management abilities and job effectiveness of each individual against requirements.

Covid-19 and the resulting challenges, from unemployment and months of furlough to personal sickness or losing a friend or family member, will place new importance on the ability of new managers to support existing teams and new employees to collaborate well with colleagues. In 2021, the following skills will be highly sought-after:

  • Adaptability
  • Communication
  • Collaboration
  • Creativity
  • Emotional intelligence
  • Leadership
  • Time management.

3. IR35

The past year saw major new payroll legislation postponed for 12 months to help businesses and employees focus on the challenges of Covid-19. However, the UK Government has confirmed that updates to IR35 will be implemented in April 2021, and that private sector businesses and all staff will need to be compliant.

The updates to off-payroll regulations will deliver significant changes for those with high-contract workforces such as Construction, Utilities, Engineering and Manufacturing. One of the biggest legislative shifts in employment law over the last decade, IR35 will impact both organisations and the contractors who work for them. From April 2021, the responsibility for determining an individual’s employment status will shift from the contractor themselves and will now lie with their employer.

The new legislation could affect organisations in the following ways:

  • Increased Costs and Resource Strain – Administrative requirements for recruiting, onboarding and managing each individual contractor will require significant time from HR, finance and legal teams
  • Increased Risk – Breaching the rules and being found to be non-compliant could spell large fines or potential prison charges
  • Restructuring – Many companies may need to restructure their workforces to ensure that projects can be delivered on time and in full, utilising the required number of contractors whilst complying with the new rules.

Spring 2021 will see firms revolutionise their methods for managing their contractor workforce, with a focus on compliance like never before. Processes will need to be as efficient as possible in order to reduce admin burdens and limit risk. Both communication between finance and compliance departments and the rest of the business, and communication between the business and its contractor employees, must be prioritised to ensure compliance. Effective management of contingent workforces will be pivotal in helping companies continue to recruit and benefit from large volumes of contractors, with minimal financial and resource impact.

VHR have implemented new compliant solutions to weather Brexit and IR35 – find out more about our international recruitment services.

4. Reversal of Skills Shortages

For the past decade, chronic shortages of new Engineers had plagued the technical sectors. Rapidly ageing workforces, slow take-up in Apprenticeships and a lack of connection with the next generation had seen a jobs market increasingly driven by candidate interests.

Before the coronavirus, more than two in five Aviation business leaders named a lack of technical skills as their most urgent business challenge, ahead of Brexit, climate change regulations and competition from low-cost airlines and emerging markets. Manufacturer Boeing forecast a mammoth global demand that would see pilot vacancies double in the next seven years, with many more Aerospace vacancies than skilled candidates to fill the roles. The Engineering sector reported a need to train 1.8 million people in the next five years alone just to meet demand for skilled labour.

However, after the coronavirus saw multiple projects delayed or cancelled and businesses fighting for survival, almost 10million employees were furloughed on the Government’s Coronavirus Job Retention Scheme (CJRS) and over 60,000 contractors lost their main source of employment. The average number of applicants for a single position has skyrocketed to 250, evidencing a rapidly growing demand for new jobs across industries and specialisms.

CEO of job advertising site CV-Library, Lee Biggins, reveals: ‘On average, our clients’ jobs receive around 25 applications per vacancy, so these figures really are massive. The job market has done a complete 180, so, while companies may have struggled to recruit before the pandemic, they’re now being bombarded with applications from professionals who are desperate for a new job.’

Organisations that have previously struggled to recruit new employees are likely to experience greater success in 2021, with growing interest in entry-level and less popular positions compared with previous years. As the employment market becomes more competitive for the average jobseeker, firms will also see a higher number of direct approaches from applicants and more creative job applications as candidates expend more effort into the recruitment and hiring process.

5. Flexibility Will Be Here to Stay

With the beginning of 2020 seeing a small (though increasing) number of employers offering flexible and remote working as a benefit or perk, the majority of office staff commuted in every day. As lockdown and social distancing restrictions took hold in March, many business leaders have discovered that their fears of disengagement, loss of productivity and laziness were unfounded. Thousands of companies have already made the commitment to a future with more flexibility.

People, Talent & Culture Director at Devon Air Ambulance Martin Bell reveals, ‘We are expecting an increased appetite for the move to continued home working even after the pandemic settles, and for flexible working requests. Wellbeing and mental health awareness is already a big sector focus but will continue to gain traction as a topic for employees to consider as we move through the current pandemic response.’

For those who are able to work offsite, flexible working has been found to increase productivity by 30%. In addition to increased effectiveness and direct benefits to the bottom line, remote working options have also seen staff engagement increase, despite the challenges faced during the pandemic. A November 2020 survey reported that more than 80% of workers want to continue working from home in some capacity from next year onwards. Employees believe they are more productive without noise and distractions, receive two or three hours of time back every day without a commute, and as a result are able to dedicate much more time to physical and mental wellbeing.

Flexible working options will spark greater benefits for employers in 2021: no longer bound by geography, business leaders and hiring managers will be able to access a wider pool of candidates than ever before. Remote working will empower any company anywhere in the world to find and recruit skilled talent from the other side of the globe, with unlimited opportunity to expand and grow.

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