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At the start of 2016, Klaus Schwab of the World Economic Forum described a fourth industrial revolution as, ‘… a technological revolution that will fundamentally alter the way we live, work, and relate to one another. In its scale, scope, and complexity, the transformation will be unlike anything humankind has experienced before.’

In the initial period after that statement was made, the adoption of digital transformation was mixed. But that all changed with COVID-19. We are living through the fourth industrial revolution right now, with further significant change on the horizon.

How have these shifts changed the way we work? What will the fourth industrial revolution and its global pandemic backdrop mean for workforce planning, recruitment, and management?

Here are seven ways COVID-19 has changed the world of work forever:

1. A lot of people will change jobs and it could be expensive

In its monthly Report on Jobs for May 2021, REC/KPMG reported that overall permanent vacancies had increased at their fastest rate for 23 years - with the increase in temporary vacancies the fastest since 2014. It also reported that the availability of candidates had fallen at its sharpest rate since January 2020, and the imbalance in demand versus supply is placing upward pressure on wages and pay rates.

The last year has been a bumpy ride for organisations and workers alike, with the turmoil causing many to reconsider their employment position. In a recent survey by learning and development platform HowNow, 35% of respondents suggested they were actively looking for a new job. With this movement of workers potentially set to accelerate once government restrictions are fully removed, managing costs effectively and having a robust supply chain mechanism to support your increased demand will be imperative.

2. The UK skills gap hasn’t gone away, it’s just fallen out of the spotlight

Boris Johnson’s recent promise of a skills revolution is not just rhetoric, the UK has a serious skills gap problem. The Government’s Shortage Occupation List, last updated in May 2021, highlights the wide range of roles where demand outstrips supply. The latest list includes all jobs relating to health services and public health managers and directors and residential, day and domiciliary care managers and proprietors and senior care workers. Perennial favourites IT and engineering also feature heavily, but so do many creative roles in music, dance, and graphic design. The pandemic hasn’t helped either, with the hospitality sector now struggling to recruit.

As we laid out in our paper The UK Skills Gap – its impact and how to address it, it’s likely that the gap will take years to address. In the meantime, maintaining an attractive employer brand and a fast and effective recruitment process should be a key focus for your organisation. This is all part of effective workforce planning: identifying that, at some point, you will need skills that are in short supply, and figuring out how and where you will acquire these skills.

3. Flexible working will be the norm, not the exception

In a recent survey by the BBC of the UK’s largest employers, 86% said they would embrace a mixture of home (2-3 days a week) and office working. This tells us the new world of hybrid working is very much here to stay. Inevitably, this means the video call culture that has become so pervasive since the first lockdown began will continue, the long-term effects of which are still unknown.

In the short term, organisations should consider how they integrate video into the way they manage recruitment online, and protect their workers from malicious online threats using single sign on or multi factor authentication.

4. Cost savings will no longer be the key priority

For the first year since it began in 2011, cost-cutting has not topped the list of priorities in Deloitte’s CPO Survey. It still ranks in the top three, but has been leapfrogged by driving operational efficiency and demand for digital transformation and innovation.

For public sector buyers, a commitment to delivering social value is also now a key criterion when assessing suppliers. Given the rapid pace of change in these areas, organisations should regularly test their suppliers’ commitment to delivering a smarter way to work in these areas to ensure they are getting the best deal, and aligning themselves with suppliers that are committed to these values.

5. People skills will be critical in driving effective digital transformation

Given the rapid pace at which new technologies appear, it’s tempting to think there will be a technology for every task at some point in the future. But technology still has (and may always have) its boundaries, and no digital solution can replace human judgment – as Amazon found out when they realised their AI recruiting platform developed bias against women.

In procurement circles there is growing recognition that soft skills are critical in delivering the right results. For example, in a recent CIPS panel discussion, a prominent CPO commented, ‘It's the people that can really effect the right change that organisations are looking for as they go onto digital transformations. The best talent doesn't guarantee success but certainly a lack of it guarantees failure.’ Face to face discussion with suppliers to establish digital capability and its limitations is highly recommended for every digital transformation project, and as part of ongoing dialogue.

6. Workers will want more from their employers

Recent research by Personnel Today suggests that the number of employees reporting mental health worries is up by 24% since May 2020, with more than half citing mental health concerns compared to this time last year. How organisations support their staff will be a key factor in where workers choose to place their labour in coming years, particular in the world of hybrid working where isolation can be acutely felt.

In areas such as diversity and inclusion, many organisations have taken positive steps towards recognising its importance, with the number of DE&I roles advertised on LinkedIn increasing by 71% over the last five years. But a survey by the prominent social network platform found that only 47% of talent professionals are held accountable for interviewing a diverse slate of candidates. If they want to attract and retain talent, organisations should focus on what they do, not just what they say, in relation to DE&I, mental health and indeed social value and environmental responsibility.

7. IR35 will fundamentally change the recruitment market

If you do a quick web search of ‘IR35 and Statement of Work’ you’ll see quite an extensive range of articles, including some on ‘how to create a statement of work’ - essentially determining ways of working outside of IR35. Regardless of your stance on this, those contractors most in demand will inevitably gravitate to assignments that fall outside IR35 and are conducted within a statement of work (SOW), as they generate a greater level of income. As this practice becomes more widespread and is deemed less of a risk, having a solution in place that can manage SOW compliantly and effectively (in terms of cost and risk) is highly recommended.

 

 

Maintaining operational resilience at such a time of change is a big ask for most organisations. The YPO Managing Temporary and Permanent Recruitment framework offers a range of solutions that mean you don’t have to do it alone. Moreover, support for all the areas listed above can be adapted to your organisation’s unique requirements.

To find out how providers such as Comensura can help, contact us.

 

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Comensura

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Jon Milton

Director
Comensura