In a time of economic uncertainty businesses need to be proactive to attract talent.
Mid-level talent will be in a good position to demand clearer career pathways and incentives to stay with their organisations in 2013.
And while salary raises are likely to be two to three per cent, if executives receive an external offer, they might expect at least double this rate, according to Pete Macauley, regional director of Michael Page International in New Zealand, which has just published its 2012/13 Michael Page International Salary and Employment Forecast.
"We have seen an increase in buybacks and counter offers," says Macauley.
If someone has an offer from a competitor, they may well have their raise bumped to five per cent, he says.
"This increase is based on the knowledge that the individual is worth that."
Findings in the 2012/13 Michael Page Salary Forecast reveal half the employers surveyed expect staff turnover during the next 12 months. This activity is likely to leave a talent shortfall within businesses, and 49 per cent of survey respondents anticipate there will be a skills shortage in their sector.
Candidates in demand are mid-level to early level management, the bulk of them three or four year post-degree with three or four years' experience.
"These are individuals from whom organisations are just starting to generate a return on their investment. The last thing they want to do is lose these people," says Macauley.
"Many employers are implementing strong internal retention strategies to hold on to their best people and this creates a challenge for other organisations looking to source talented staff."
Unearthing new hires could be the biggest challenge in 2013. The survey comments on a perception by employees that the current market lacks new career opportunities.
"The talent which has been retained, have seen their families and friends lose their jobs," explains Macauley. Mid-level managers have seen the global struggles with Europe and debt crisis, and perceive the market to be flat and with not as many opportunities.
This has made them less adventurous about seeking out new roles.
"A proactive approach to the market where companies profile opportunities to both active and non-active job seekers, is the most effective strategy in securing the best talent in the market," says Macauley.
"We, at Michael Page, are having to be a lot more proactive, partnering with clients to attract talent to opportunities," he says.
According to the survey findings, 41 per cent of respondents will emphasise their strong company culture to encourage professionals to join their organisation and remain in their roles. Employee recognition and reward incentives, both financial and non-financial, also play a role in the attraction and retention of good staff, according to 23 per cent of survey respondents.
Meanwhile organisations are continuing to invest in talent, now the market is stronger. Staff want to see real and convincing career pathways, having seen their progression on hold in the past few years. "Organisations need to be able to provide progression and opportunities or they will lose their talent," says Macauley. Talent want to see a "visible pathway" and for that pathway to be delivered.
"There's been a lot of talk. Employees want to see it."
They also want to receive learning and development, a demonstration that businesses are acknowledging them and investing in them. While a lot of organisations been telling talent that it is good, they may not have been able to provide any real rewards in recent years, says Macauley.
In order for staff not to get itchy feet, employers have to provide extra added
challenges and learning on the job so they can develop their skillsets, he says. They are not looking for theoretical training which they may not be able to apply.
For those mid level executives just a few years into their employment life cycle, this can often be the time when they head offshore to the UK and Asia. Meanwhile skills shortages in New Zealand expected to increase in 2013 are in sales and marketing.
"The market is short of strong new business development sales people. There's demand for account management, people who can engage with new clients, generate a return, and grow new channels," says Macauley.
Organisations are looking to develop their business and marketing strategy,
brand communications strategy, continuing to invest in that. And while larger multinationals have centralised their marketing function back to Singapore and Australia during the recession, making their marketing in New Zealand more executional than strategic, SMEs are continuing to invest in marketing.
"We have seen an increase in digital marketing and growth and development taking place in social media offering new channels to market. There is strong demand for candidates in new product development, trade marketing and in store retail marketing. Christchurch looks set to be providing a growing number of jobs in 2013 with more people happy to relocate to the city."
"The demand for talent for Christchurch will continue to grow, particularly in property and construction," says Macauley. But he is expecting demand from all industry sectors. Companies based in Auckland are recruiting locally but looking to send staff to Christchurch.
The Wellington job market, meanwhile, looks likely to be pretty tough and Auckland stable this year, predicts Macauley.
"A lot of it comes back to confidence. It has been tough for the manufacturing sector but agriculture and construction has had a good last three to six months," he says.
"New Zealand businesses have managed to get growth with a lean structure in place, adding to the confidence of the employers."
* 50 per cent of surveyed employers predict staff turnover during the next 12 months while 49 per cent anticipate a skills shortage in their sector.
To attract the best talent, most employers (41 per cent) will promote their strong company culture and 23 per cent will offer recognition and reward incentives.
Employers plan to offer a range of incentives to appeal to potential employees, including a mobile phone (89 per cent), company car (69 per cent) or healthcare and insurance benefits (63 per cent).
* 48 per cent of employers are likely to offer bonuses as a fixed percentage on base salary and just over half of employers (53 per cent will offer salary increases of 2 - 3 per cent.)
The survey is available on-line - go to michaelpage.co.nz