RPO & StaffingTalent Acquisition

Tacking New Zealand’s HC Woes in a time of Labor Shortages

Affordable human capital is a scarce resource in the Land of the Long White Cloud. With the economics of working in the island nation increasingly difficult on workers, employers and RPO providers must rethink their approach.

by Martin Crysell

New Zealand, once a place where people from around the world chose to relocate for its very attractive lifestyle, is now struggling not only to keep top local talent but also to attract international human capital. Facing a rapidly rising cost of living (particularly housing) juxtaposed against stagnating salaries (at one-half or one-third what is offered elsewhere), the country is finding it difficult to afford the needed talent1 .

In addition, in sectors such as banking/financial services and IT, the infrastructure has moved out of Australasia as new hubs have sprung up in Singapore and other Asian cities, providing opportunities for New Zealand executives to move offshore to take part in large-scale, complex projects that will help advance their careers. For some specialized skills (e.g., engineering), there simply aren’t enough people with the advanced training living in New Zealand to meet the demand.

All of these factors have compelled the government and private sector to think outside of the box and devise new ways to recruit and keep the best people on their teams. For example, there is now a focus on creating flexible or temporary assignments, using contractors and consultants as a viable alternative to hiring permanent staff. In many cases, they are sourcing and overseeing this process directly to save costs.

Government Actions
To minimize churn, government organizations are also proactively creating job rotation opportunities for their managers to foster their development and expose them to new challenges. Additionally, they are tapping in to the global pipeline of New Zealanders living abroad, attempting to lure them back home.

While all of these measures are having some impact, they aren’t fail-safe. To maximize their effectiveness, added support from RPO is being seen as one tool. Indeed, in recent months, the HR departments of the labor, justice, and health ministries have submitted requests for proposals from recruitment solutions providers, looking to hybrid models to address their challenges and reevaluate their current processes.

Some of the advice that my colleagues and I have given is based on our experience and understanding of the New Zealand talent market, and key points include:

• Centralized internal mobility programs have a greater chance for success. While numerous studies show that regular job rotations as part of a development program are a key way to retain high-potential staff, doing so in an unstructured fashion undermines the effort. Without a centralized system of tracking internal mobility and communicating it effectively to eligible staff, the risk is great that up-and-coming managers will walk out the door, unaware that these chances to take on new tasks or learn about other parts of the organization were available.

• Marketing to the global pipeline of returnee talent is essential. Similarly, while there are many New Zealanders living abroad who would welcome the chance to return if given the right opportunity, often they do not know where and what kinds of openings there are. As a result, candidates are lost, and roles remain vacant. Global RPO providers can facilitate and maintain contact with these professionals and position the nature of the work in New Zealand in a way that is most appealing to them. The ability to have a “bigger piece of the pie,” to take on more responsibility earlier than they would elsewhere, and the potential for growth all must be presented to these returnees as part of the recruitment process.

So in a labor market as squeezed as New Zealand’s, attracting the right talent requires the employer to not only change how it recruits internally but also perhaps to seek external help to supplement its programs.

1The Economist’s Worldwide Cost of Living Index (March 2007) ranked Auckland and Wellington 50th and 51st in its indexed list of the most expensive cities.

Martin Crysell is a managing consultant with Futurestep, Korn/Ferry International’s outsourced recruiting subsidiary.

Tags: RPO & Staffing, Talent Acquisition

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