CRE Workforce Dynamics & Hiring in 2022
Author: Forbes J. Rutherford, Principal, Rutherford International Executive Search Group Inc., Managing Director, NEXTalent Marketplace & Job Board, T: 855-256-5778 or Chat
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, 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 seventy-six per cent 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 eighty-three per cent 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 hyper-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 to retain institutional knowledge and find quality talent through 2022/23.
“Expect a Higher Than Normal Spike in Q1/22 Retirements”Forbes J Rutherford, Rutherford International, 2021
Given pension fund portfolio weighting, this challenge to the industry risks being longer if inflation, broader public sector entitlements and early retirements negatively affect pension fund’s 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 back to age sixty-seven to offset pressure on the pension plans and keep the labour supply intact. 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.