Creating a connected and skilled workforce to effectively adapt to changing times

Switzerland is currently experiencing a significant workforce shortage, making it challenging for businesses across the country to find the talent they need to succeed. This is a concern not only for human resources, but one where an enterprise-wide strategy involving leadership at all levels is needed.  We have identified several high-impact opportunities across the employee lifecycle where companies can take steps to address this growing issue and ensure they attract and develop the talent they need to thrive, from recruitment efficiency through workforce planning to retention strategies.

Creating a connected and skilled workforce to effectively adapt to changing times

Switzerland is a small, but prosperous country that is globally known for its high standard of living, excellent education system, and advanced economy. However, Switzerland is currently experiencing a significant workforce shortage, making it challenging for businesses across the country to find the talent they need to succeed. In this article, we will explore some of the challenges companies in Switzerland face in attracting and retaining top talent and how to address these.

The Swiss job market is growing significantly and the economic indicators this spring continue to show growth. Job adverts have grown 23% in 2022 compared to 2021 across Switzerland and unemployment rates remain historically low[1]. According to the Swiss Federal Statistical Office, 37,5% of organizations reported challenges in recruiting qualified labor during the first quarter of 2022[2]. This marks an increase of 8.7 percentage points from the same period in 2021. This growth represents the largest annual increase in the past five years.

The workforce shortage is caused by several factors, including an aging population, low birth rates, and a lack of qualified workers entering the job market[3]. As a result, many companies are challenged to find the skilled workers they need to grow and succeed in today’s competitive business environment.  

So, what can your organization do if you are struggling to attract qualified workers for your business? Beyond the obvious employer branding and talent search efforts, we have identified several high-impact opportunities across the employee lifecycle where companies can take steps to address this growing issue and ensure they attract and develop the talent they need to thrive. You’ll find that this is a concern not only for human resources, but one where an enterprise-wide strategy involving leadership at all levels is needed.  

Recruitment efficiency – treat your candidates like customers

Organizations claim they are increasingly faced with the challenge of finding, hiring, and retaining the right talent. That said, we’ve learned that even the most agile companies encounter obstacles with inefficient talent acquisition processes, leading to above-average hiring costs and delayed time to productivity. Knowing that the best candidates are off the market within 10 days, slow organizations can miss the right candidate with an inefficient process[4].

The recruitment process has a significant impact on the candidate experience. Slow and overly bureaucratic hiring procedures, such as lengthy and complex online forms, can discourage top candidates, causing them to quit in the middle of an application and ultimately resulting in missed opportunities for the organization.

When your company considers the candidate experience journey and focuses on those moments that matter, you’ll find that targeted improvements, such as increased transparency or streamlined approval flows, could have a significant impact. Companies that optimize the end-to-end recruitment process, reducing waste, and using technology to automate routine tasks, will convincingly attract the scarce available talent.  

Onboarding effectiveness – consider the total cost of talent acquisition

In Switzerland, on average the hiring cost of an employee amounts to about 16 weeks’ salary. While pre-match costs, such as search and selection, account for approximately one fifth of a firm’s hiring costs, the main components are post-match hiring costs. This is a combination of the initial low productivity and disruption costs, resulting from the training of a new hire.

Employers are confronted with so-called infancy attrition, where a new hire quits within the first 90 days linked to an insufficient onboarding approach. An onboarding program with focus on workplace integration increases retention by 50% because new hires are more likely to feel connected to the organization and understand their role within it.[5]

Before companies start seeing a return on their recruitment investment in a new hire, it can take a while depending on the seniority of the position. A survey by Harvard Business School estimated that typical mid-level managers need six months to reach their breakeven point. Moreover, it typically takes new employees an entire year to reach their full performance potential.[6]

The most optimal way to speed up new hire proficiency is an effective onboarding program, where new joiners feel valued and supported. Organizations often assign an ambassador or a buddy during the onboarding process, to facilitate the integration of the new employee in an informal way. The manager also plays a crucial role in the onboarding experience. Personal touchpoints during the pre-boarding phase and the first days on the new job are essential and will ultimately reduce the cost of acquiring a talent. Connected employees are more likely to feel invested in the organization’s success and contribute to its growth. Studies show they work considerably harder and are nine times less likely to leave.[7]

The right people with the right skills at the right time – skills-based workforce planning

In order to meet ever-evolving business requirements, companies are evaluating their current talent mix and assessing the composition of their workforce. Your company may be struggling to find the right skills needed to grow your business.

Our research shows that a majority of executives agree the gap between the skills their organizations need and the ones that people possess is widening. The skills that were in demand a few years ago may no longer be relevant, and new skills are constantly emerging. To remain competitive and future-proof, companies need to invest in their employees’ professional development and provide them with the skills they need to succeed in their roles and to advance their careers. With technology rapidly changing the way we work, it is essential to invest in digital skills, such as data analytics, artificial intelligence, and automation.

In this squeezed labor market, it’s much more cost-efficient and effective to develop talent internally, rather than trying to hire externally.[8] Companies can use talent-marketplace tools to facilitate internal mobility and better prepare managers to act as career coaches and advisors so that employees are equipped to move into high-demand jobs. Providing employees with opportunities for growth and development not only improves retention rates but also enhances their skills and abilities, ultimately benefiting the organization.

Another one way to cope with shortage of required skills in the market is to question the composition of your workforce, not just from a virtual vs. on-premises perspective but also from fluid vs. fixed workers share.[9]  An increasing proportion of the workforce prefers roles that offer flexibility, variety, and fewer constraints. More than half of recruiters surveyed by LinkedIn have seen candidates turn down an interview or job offer due to a lack of flexibility and remote work options in the workplace.[10] A corporate culture with flexible work arrangements such as home office or other flexible arrangements, and a good work-life balance will help you tap into a wider pool of talent and retain existing employees who may otherwise leave for more flexible work options.

Retain your best talents – (re-)build an inclusive corporate culture and listen to your employees

Overall, the organizational costs of employee turnover, which refers to the percentage of employees who leave an organization within a given period, are estimated to range between 100% and 300% of the replaced employee’s salary when you consider time to productivity and time to profitability discussed above.[11] In these times, when disengaged employees are referred to as silent quitters, it is essential to identify the factors that impact employee retention and develop effective strategies to address them.

Recognizing and rewarding employees for their hard work and achievements can boost morale and create a positive work environment. This can be done through bonuses, promotions, public recognition, or other forms of appreciation. However, to effectively increase your attractiveness as an employer, we recommend to establish a comprehensive people strategy including development and growth as well as wellbeing and workplace environment.  We’ve found that leading organizations offering a superior experience will embed employee-listening programs and surveys into their strategy to gather feedback on what matters most to employees. Furthermore, these companies will be transparent about the outcomes and related actions.[12]

Moreover, when your company has a recognizably good working environment with strong employee retention rates, this will also encourage venture capital investments, as companies with low employee turnover are viewed as less risky.[13]

Building brand ambassadors – the offboarding experience

We need to consider that the average time employees stay with their employer is rapidly decreasing per generation. While the currently retiring baby boomers stayed with their employers for an average of 8.3 years, the Generation Z now entering the workforce will have an average job tenure of about 2.3 years.[14]

Employees depart, taking with them valuable skills and knowledge that can be problematic for a company. To counter this challenge, it’s important to ensure that the offboarding process is handled in a way that maintains positive relationships with departing employees and maximizes the value of their experience and knowledge. We have found that a large majority of organizations have no formal offboarding process, while a positive offboarding experience can leave a lasting impression on the departing employee. An exit interview or the possibility to share their experience will make the employee feel valued and respected, hence they are more likely to speak positively about the organization to their peers and friends.

An effective offboarding process ensures that departing employees have an opportunity to pass on important knowledge, skills, and experience to their replacements. When employees feel that they have contributed positively to the organization and their replacement is well-prepared, they are more likely to feel that their time at the organization was valuable, and this can contribute to positive feelings about their experience working there.

Maintaining a good relationship with departing employees, through an alumni network or regular touchpoints, can also help to improve an organization’s reputation and make it more attractive to potential candidates. It is also a key part of a talent acquisition strategy as 15% of employees have boomeranged back to a former employer while another 40% would consider the possibility.[15]

We have looked at a number of high-impact opportunities where your company can take action to address the increasing shortage of talent in the Swiss workforce. These are spread across the lifecycle of the employee, from attracting, efficiently hiring, and effectively onboarding new employees to retaining and upskilling key talent and turning departing employees into ambassadors. Nurturing the people experience and enhancing skills and abilities of your workforce will give you a significant advantage in this highly competitive talent market.

[1] https://www.adeccogroup.com/en-ch/future-of-work/job-index/job-index-q4-2022/

[2] https://www.bfs.admin.ch/asset/fr/206-2204

[3] Also read Capgemini Research Institute’s ‘Conversations for Tomorrow – Nurturing the Future of Work’: There are an estimated 700,000–1 million vacancies in Europe related to digital skills.

[4] https://www.linkedin.com/pulse/top-100-hiring-statistics-2022-rinku-thakkar/

[5] Read Harvard Business Review. Companies lose 17% of their new hires within the first 90 days due to an ineffective onboarding strategy.

[6] Gallup’s “Creating an Exceptional Onboarding Journey for New Employees” report.

[7] https://www.gartner.com/en/human-resources/trends/new-hire-checklist

[8] Also read Capgemini Research Institute’s ‘Conversations for Tomorrow – Nurturing the Future of Work’: HSBC’s Elaine Arden comments: “We […] have an internal talent marketplace that 140,000 employees use. It’s a game-changer: connecting talent and skills, at scale, across the business. It empowers people and democratizes access to work by disrupting traditional internal hierarchies and breaking down silos.”

[9] Capgemini Research Institute “The Fluid Workforce Revolution”.

[10] https://www.linkedin.com/pulse/top-100-hiring-statistics-2022-rinku-thakkar/

[11] Harvard Business Review

[12] Read Capgemini Research Institute’s People Experience Research Report.

[13] Read Nobel Prize Laureate Sir Christopher Pissarides in Capgemini Research Institute’s ‘Conversations for Tomorrow – Nurturing the Future of Work’

[14] Forbes 2021

[15] Read Harvard Business Review on Boomerang employees