We need more resources but we don’t have the budget to commit long term”. “We can’t add to our fixed overheads until the market stabilises”. They’re dilemmas I hear every day. They’re also the trigger for one of the UK employment market’s biggest black holes.
Underemployment is a dark truth in the world of recruitment. It’s been masked by recent improvements in unemployment figures, but I don’t buy that everything in the garden is rosy. The truth is, a near-record 1.4 million - or 5% - of those in employment - are forced to work part-time because full-time options simply aren’t on the table. Couple that with a five-year drop in real wages and we have a problem on our hands.
It’s time to lose the part-timers and the zero-hour contracts. We can’t argue that it’s in the best interests of workers to be given the security of guaranteed hours and pay, but what many are failing to see is the actual cost to business from trying to cut costs. It’s your perfect catch-22.
We want stable recovery and growth. We’re invested in building our business. Yet we’re continuing to bench staff, placing them in reserve and only calling them into play as and when the need arises. Without experience on the field or a commitment from those at the top, they’re not invested in the long-term goals of the business. Demoralised and lacking loyalty, they’re liable to switch clubs at a moment’s notice if a better offer comes along. Does that sound like a stable foundation for the future of the business?
The recession shook business confidence and we’re no longer taking risks the way we used to. It’s natural to shy away from the potential burden of redundancy, the heavy weight of fixed overheads when a still-turbulent market is liable to pull the rug from under our feet at a moment’s notice. But it frustrates me that a lack of commitment from the top should be the answer.
My experience shows me that it’s a question of balance. We can’t throw caution to the wind and hand out contracts left and right - but no risk means no rewards. Taking on full-timers will generate increased loyalty, reduce staff turnover and associated costs, boost productivity and ultimately drive business growth.
Underemployment costs the individual, the business and the economy. Before this epidemic grips the recruitment sector, let’s take a moment to consider where it will take us. And get hiring.
Jonathan Fitchew is CEO of Pareto Law