CRE Workforce Dynamics & Hiring in 2022
Author: Forbes J. Rutherford, Principal, Rutherford International Executive Search Group Inc.,
Introduction: In Q2/2020, Rutherford International asked 204 senior multi-sector industry leaders within Canada’s commercial real estate industry to rank the political, economic, social and technological threats they expected to face through Q4/2021. Participants with direct or indirect authority over their resource plans also provided details. Please note that the data collection was completed early on in the pandemic, when few of us foresaw an extended lockdown.
This article is the fifth in a series of commentaries that examine potential threats to Canada’s CRE industry, post-pandemic workforce dynamics and the probable impact on industry employment in 2022.
Hiring Challenges in 2022 – Hyper-Retirement, a Systemic Exodus
Out of 65 possible threat scenarios, approximately 76 percent of respondents described talent quality and scarcity as ‘somewhat likely or likely’ for 2021. They were classified as emerging threats, implying respondents guessed they had a runway of three or four years to manage the impact of retirement-driven vacancies. Workforce effectiveness was ranked higher by 83 percent of respondents. However, none made it into the top thirty of our heat map.
“A Black Swan Arrived With a Thud”
Unbeknownst to all of us, COVID19, a Black Swan, arrived with a thud, shaking the employer/employee social contract to its core. One critical knock-on effect was the accelerated advancement of the Boomers’ (and early Gen-X) retirement timeline. Those who can retire are not returning to full-time work. The industry should expect a higher-than-normal spike in Q1/22 retirements once STIP and LTIP compensation programs are received. This compression of four retirement years into one will likely compound the industry’s challenge of retaining institutional knowledge and finding quality talent through 2022/23.
“Expect a Higher Than Normal Spike in Q1/22 Retirements”
Forbes J Rutherford, Rutherford International, 2021
Mapping Institutional Knowledge by Understanding Network Centrality
Given the pension fund’s portfolio weighting, this industry challenge is likely to persist if inflation, broader public-sector entitlements, and early retirements undermine its ability to meet annual distributions.
“If Governments Had the Will, They’d Reset the Retirement Age to Sixty-Seven”
Forbes J Rutherford, Rutherford International, 2021
If the government had the will, it would revisit the idea of resetting the retirement age to age sixty-seven to ease pressure on pension plans and maintain the labour supply. Such a public policy shift would result in a political backlash from senior voters; however, those directly affected would be the long tail of the Boomer Generation. The majority of the Boomer cohort has already surpassed age sixty-seven.
Succession Planning and Retention of Generational Knowledge
