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 ninth 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.
An Asymmetrical War for Hybrid Talent
Hiring Challenges in 2022
Winning the Asymmetrical Battles For Hybrid Talent
We began this series suggesting the term “The Great Reset”, which political pundits commonly use as some grand scheme for reordering society, might actually be a euphemism for describing the developed world’s shift to a distributive workforce economy. What should have taken years with the incremental influence from Gen-Y and Gen-Z’s in the executive suite, was forced by necessity in weeks. Twenty-four months later, the idea of working from home or working hybrid is as much a lifestyle choice as it is a health precaution. The idea has now become an expectation, an expectation not limited to a select few employees but spans the rank and file.
Notwithstanding organizational design, continuity of team and culture, this shift in the workforce dynamic has forced upon employers and employees a variety of outcomes that have yet to be faced. Depending upon age, one can call the current shortage of labour “The Great Retirement” or “The Great Resignation”, but I believe this disengagement of the workforce could be better characterized as a collective post-traumatic stress disorder writ large. The industrial world’s reaction to the OMICRON variant indicates that our societal neurosis is wired to a hair-trigger response capable of stampeding us back into our homes. It will take years before the emotional scarring of this pandemic subsides and, without doubt, will lead to a reordering of corporate and societal priorities.
Owners and developers anxiously await their occupiers return to a pre-COVID19 status quo, and evidence suggests this is the case in the city cores. With well-positioned, high-quality assets, the situation for some owners looks relatively the same for them as before the Pandemic. However, for most, it isn’t. Occupier strategies, space design and requirements will remain in flux for years to come. Some markets and sectors, particularly post-modern Class B and C assets in mid-market cities, will have difficulty extending their occupiers’ lease terms. These assets are destined to be revalued or repurposed. Either option presents an opportunity for real estate professionals.
Employers of high knowledge and digitally competent employees have used the past twenty-four months to strategize a space use capacity. This strategy is designed around the accommodation of a flexible workforce that is enabled for quick adaption to market changes. However, in due course, some occupiers who have adopted a hybrid workforce management strategy will discover they are at a competitive disadvantage for attracting employees living beyond an acceptable commuting radius. These companies, over time, will phase to a fully distributive workforce design. Gen-Y and Gen-Z will likely drive the speed to full workforce distribution, and, given their technological agility, it will happen surprisingly fast. The challenge for landlords will be determining the potential of a prospective tenant shifting to a fully distributive workforce, and if so, the speed and scope of the conversion.
Winning the Talent War: Measure Twice, Hire Once
Whether on-site, hybrid or remote, the war for effective agile talent will be asymmetrical, using unconventional talent identification strategies, science-based behavioural profiling, predictive performance analytics and pro-active acquisition tactics.
Dragging a hook through a social or professional network talent pool with a job ad in the hope of snagging above-average talent is a reactive and rarely satisfying acquisition tactic. Acquiring talent begins by proactively targeting high potential prospects through referral networking in advance of an opportunity.
In a talent war, winning isn’t measured in the cost of acquisition or time to hire but in the hire’s impact on productivity and the bottom line. The future calculus for a successful outcome is based on Revenue and Profit Per Employee ratio analysis. These metrics are often used to compare the performance of companies in the same industry but can be most effective in understanding the marginal gains on revenue and net profit per each new hire. Also, from an employee engagement and motivation perspective, by internally posting these metrics a company can effectively incentivise corporate performance.
Companies will not have the luxury of building a trial period into their offers of employment for above-average employees. Just as companies are moving to AI for business advantage, it is now possible to incorporate machine learning supported by AI analytics for estimating the long-term impact of a successful hire on corporate development. To hire successfully is to know the prospect’s potential for on-the-job effectiveness in advance. The relationship of forecasting on-the-job performance with behavioural profiling science has made great strides since industrial psychologists measured human potential seventy years ago.
Today, it’s possible to empirically predict a person’s potential to high perform as an employee, manager or executive compared to their functional peers. This exacting due diligence details the prospect’s succession potential, their default leadership styles and what areas of personal development will have the most significant impact on their future effectiveness as an employee and executive leader.
Rutherford International and our NEXTalent Marketplace & Job Board are committed to building a CRE community of investors, developers, builders, financiers, thought leaders, advisors and mentors who recognize the benefit of using the 21st Century AI analytics to foster project teams and nurture high-performing industry talent. To learn more about our services, don’t hesitate to get in touch with us at 855-256-5778 X101