Quiet hiring: Why managers are recruiting from their own ranks

Financial Times

11 Feb, 2024 06:00 AM5 mins to read

Recruiters are looking for skills and character traits, rather than being job-specific. Photo / 123rf

London Business School academic Lynda Gratton spends her time advising employers about how to better organise their workforce. But she no longer thinks much about jobs - lately, she has noticed, specific roles have been replaced with lists of desired skills and character traits.

“When I work with companies now, the matrix they have is not jobs, it’s skills,” she says. Employers are looking not for specific roles but people who can be creative, experiment with new ideas or manage complex stakeholders. “Don’t get hung up about job titles: ask what skills are going to give you opportunities to grow.”

One in 16 workers globally may have to switch occupations by 2030 as their roles become obsolete, according to consultancy McKinsey, and nearly nine in 10 executives say they face imminent skills gaps. Faced with the need for new and developing skills, many employers are choosing to retrain their own workers rather than recruit externally.

Emily Rose McRae, senior analyst at human resources firm Gartner, calls this “quiet hiring”. As a tight labour market makes finding outside expertise harder, managers identify who on payroll has nascent or existing skills, give them training, and reallocate their responsibilities to meet fresh needs.

“Successful organisations will be those that look not just out to the recruitment market, but also among their own ranks,” says Sander van’t Noordende, chief executive of human resources group Randstad.

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At advertising firm Ogilvy UK, for example, a social media and influencer team that once catered to a niche market of cult beauty brands is growing fast.

The advertising company is helping employees adapt to new skill demands through peer learning: younger staff with influencer experience are paired with colleagues in traditional advertising to share expertise.

“It’s opening up internal possibilities,” says Fiona Gordon, chief executive of Ogilvy UK. She believes employers must watch emerging trends closely and be willing to increase investment. “Occasionally you have to make a bet.”

The approach requires managers to be in “problem-solving mode”, says McRae. Where they do not have a database of staff skills, for example, they could map expertise by tracking who has used certain software.

Some employers have embarked on ambitious training efforts. Professional services firm Accenture, for example, has trained 600,000 employees in basic artificial intelligence, and 250,000 in generative AI. At property group JLL, 30,000 employees have learned sustainable real estate practices.

But not all employers are taking the initiative. “Many private firms rely on their ability to buy in talent rather than thinking about building that internally,” says Lizzie Crowley, senior skills policy adviser at the CIPD, the professional body for HR and people development. “[They] don’t have a strategic approach in the short term, let alone long term.”

And training — or “reskilling” — overall has languished among employer priorities in recent years. The amount UK employers invested in skills per employee has fallen by 28 per cent since 2005, according to the Learning and Work Institute.

Sebastian Dettmers, chief executive of global recruiter StepStone Group, warns that while some big companies are creating good skills strategies, employers generally are “clearly not” doing enough.

“The main point is to understand what skills [staff] need in the future,” he says. “It’s always challenging when interest rates are high, when you have low growth rates and recessions, but it means investing.”

At communications company Cisco, Chintan Patel, chief technology officer for the UK and Ireland, identifies data governance, AI strategy and managing the basic infrastructure of AI systems as key areas for new skills. Basic online safety — password hygiene or responsible use of wireless networks — could also be strengthened.

“One of the biggest things our customers and industry tell us about is this overarching challenge around skills and leveraging AI,” he says. That is “fundamentally” about recruiting, retaining and developing the right people.

World Economic Forum managing director Saadia Zahidi says “deeply human traits” such as analytical thinking, leadership and flexibility, as well as tech and green abilities, will become essential.

As more jobs are created, automation will render others redundant. Four out of five employers told the WEF that alongside investing in training, they would act faster to automate some work, bringing “displacement, augmentation and emergence of new roles at the same time”, Zahidi says.

This demands delicacy from managers. A haphazard approach can prove problematic for industrial relations: for example, announcements about future job losses may appease investors but demoralise staff.

Dan Lucy at the Institute for Employment Studies advises organisations to engage in future workforce planning exercises every two to three years, considering the wider business and labour market context, the capabilities needed to hit targets, and what that means for roles and skills.

Allison Horn, head of Accenture’s talent transformation, observes an “ongoing struggle within organisations where they have invested in training but haven’t invested time and resources in helping people learn to learn. People need the right resources, encouragement, context and time to develop new skills”.

Without the ability to accurately predict which jobs will be in most demand in the future, the ability to pivot to new work and quickly retrain could be the most valuable skill of all.

“We’re going to need people to be able to adapt,” McRae says. “Now people could be specialising in an area which, in five years, is not done at all.”

Written by: Bethan Staton and Emma Jacobs.