As Canada’s largest metropolitan centre, the vast majority of national and multi-national companies are headquartered in the Toronto region. Our city-region boasts a strong financial services sector and a number of burgeoning industry clusters—all of which are significant talent attractors. The region is also a leader in human capital, possessing a large and diverse pool of highly educated, skilled and specialized talent.
It seems like a recipe for the perfect mix of talent supply and demand. Yet a rapidly changing and increasingly global economy, forever altered by disruptive technologies and demographic shifts, is making it challenging for talent management in every organization to connect talent with jobs and jobs with talent.
So how does a business attract the right talent to stay competitive in times like these? OnBoard explores what Toronto companies are doing to attract the best and brightest—and why it’s important for businesses and the economy.
The Changing Landscape of Talent Management
Attracting the best and brightest in this new economic landscape is something Carl Lovas, Canadian Chairman of Canada’s leading and largest executive search firm, Odgers Berndtson, knows well. The executive search industry grew globally by 12 per cent last year; a notable statistic considering the relatively flat global economic growth. He believes this shift is due to a number of factors, the most significant being a new focus on the importance of good leadership to an organization. “The world has finally concluded that talent can have a huge impact, in fact, more of an impact than anything else in an organization, particularly when it comes to executive talent,” he explains. “Organizations focus on leadership more than ever before.”
Mr. Lovas also points to the imbalance of supply and demand as a factor. “People have been talking about demographics, and the war for talent and baby boomers retiring for over a decade, but now we are really seeing that have some traction,” he explains. Toronto is poised for a significant shift in the labour force over the next decade. A labour market demand forecast, published as part of the Toronto Region Board of Trade’s 2014 Closing the Prosperity Gap report, projected an expected 271,700 vacancies from retiring older workers; and that number does not include jobs created through economic growth.
“Imagine the next 10 years,” notes Mr. Lovas. “This situation is creating a genuine talent shortage that makes recruiting more challenging.” This, of course, is why executive search continues to grow as an industry. “Our clients turn to us when recruiting becomes difficult.”
For executive talent, it is becoming a job seekers’ recruitment market. But increasingly this extends to other levels of employment. According to a Manpower survey conducted in Q1 of 2015, 34 per cent of employers across the Americas have difficulty filling jobs due to a lack of suitable applicants—up from 25 per cent in 2014.
So how are companies today attracting the right talent? A recent study from LinkedIn found that 59 per cent of Canadians say a company’s reputation as a great place to work is the single most important factor when considering a new job. The increasing importance of employer brand is something many Toronto-based companies are now embracing. In the late 2000’s companies began developing completely fleshed out brand propositions, marketed with the same fervor and consistency as consumer branding.
The reality for businesses today is that the digital revolution not only changed business needs, it altered the ways in which information is shared. Social media, online industry hubs, and sites like Glassdoor give a new level of transparency to corporate culture. Quite simply, an unfavourable company reputation can do damage to a company’s recruiting efforts.
Equally, a positive company reputation can be a significant attractor for job seekers. Numerous awards throughout the GTA, such as the Greater Toronto Top Employers list, released annually, or the Board’s Business Excellence Awards - Employer of The Year Award, showcase organizations that offer a positive company culture and environment, and use it to better their business results.
Smart companies have embraced this shift, and employer branding is no longer the sole domain of the HR department. An integrated team of HR, marketing and communications professionals jointly manage employer brand strategy. In fact, barely a third (36 per cent) of employer brand strategies are still managed by HR alone. This demonstrates an understanding that who you are and what you do as a company is only part of the puzzle. Effectively communicating that message is an essential part of ongoing talent recruitment and management.
Andrea Richardson, Director of Global Human Resources at Toronto-based company Infusion, has witnessed the industry shift over her decade long tenure with the company. “Social networking has transformed the way we make decisions about products and careers. Candidates are choosing which companies they want to work for based on employee testimonials and recommendations,” she explains. “Companies are investing in talent branding as a strategic priority to attract, engage and retain candidates and employees.”
That branding responsibility goes even further, according to some sources, stretching to the CEO. A 2015 report from the Harvard Business Review found that 60 per cent of CEOs surveyed believe employer brand responsibility lies with the CEO. This aligns with the continually evolving role of leaders or “the ever-higher bar being set for executives,” as Mr. Lovas calls it. In the digital media age, the public face of a company is in and of itself a powerful talent attractor.
Analyzing Talent Attraction
Branding is one thing. Successfully attracting key talent in a market that favours highly skilled job seekers means that companies need to be aggressively competitive in their recruitment offers. Market-competitive salaries are a must and still remain a key factor in attracting the right talent. Accurate compensation information is a critical tool, and can be discovered through resources, such as the Board’s Compensation Reports, an annual compensation benchmarking tool for companies in the Toronto region for more than 60 years.
This is only the tip of the iceberg; Toronto region companies today must ensure they offer a great place to work. How you treat your employees and support them to grow professionally is essential to retaining high achieving talent.
Employees today have an expectation beyond compensation; they expect recognition, support, and yes—perks. Accenture offers top-up for maternity and paternity leave, and subsidies for employees requiring IVF treatments. Rogers Communications offers a share purchase plan and flex hours. Scotiabank has an onsite daycare, a rare and attractive perk that sets it apart from the competition. Small businesses frequently sell themselves through their workplace culture, which could be anything from offering a games room to blow off steam, unlimited vacation time, or a flat organizational structure.
A positive workplace generates higher productivity and revenues, but the focus on workplace culture is also important because the average career trajectory has changed significantly in the Toronto region. Twenty-eight per cent of Canadians have held between 5 and 10 jobs throughout their career, and another 16 per cent have held more than 10, according to a report from Workopolis. The evolution of work continues to shift towards more jobs, for less time, across all demographics.
Mr. Lovas notes this shift in the executive market as well. “You’ve gone from an environment where people joined an organization and stayed there for life, to one where people move frequently...between industries, and between companies.”
Thinking Globally about Talent
Mr. Lovas also indicates that the Toronto region’s talent opportunities and challenges are increasingly global in scale. On a broad economic level the region has concentrated industry clusters that drive growth and, as such, require highly specialized talent. Particularly as many of our region’s businesses expand their international footprint, that global knowledge and experience becomes increasingly important. The financial services sector, arguably the backbone of Toronto’s economy, continually shifts towards more foreign investment. For example, more than 70 per cent of Canadian Pension assets are invested internationally. Canada Pension Plan Investment Board (CPPIB) President and CEO, Mark Wiseman stresses the importance of international knowledge, noting that nearly 75 per cent of senior employees at CPPIB have international experience.
The 2015 edition of the Board’s Scorecard on Prosperity report highlights the value of our diverse, multicultural population, noting the untapped potential of our vast immigrant population. More than half of our population is foreign-born. These professionals have connections and specialized knowledge in their countries of origin, but businesses are not taking full advantage of these talented individuals. Cultivating these relationships offers a strategic advantage for businesses looking to open up new revenue streams in high-growth markets.
Growth in those markets is essential for the prosperity of our region, but they also influence our own talent pool. “What’s happening in places like Singapore and Hong Kong is that these emerging markets are drawing talent in… resulting in an outflow of talent being drawn to these places,” explains Mr. Lovas. While this does extract from the talent pool, there is a value to those connections made around the globe.
Toronto talent working abroad should be encouraged to eventually return to the region, and bring with them the highly valuable global experience that businesses continue to seek. Toronto Homecoming is an initiative that connects Canadians working abroad (and those with ties to Canada) to professional opportunities in the Toronto region. High calibre candidates working in competitive markets such as, Hong Kong, London and Singapore, apply to attend a weekend networking event with many of the region’s top employers, including KPMG, Rogers, RBC, and TD. This collaborative effort is an example of the ‘out of the box’ methods many companies are using to connect with top talent as competition becomes more fierce for attracting the right people.
As Toronto continues to build its position as a globally competitive, world-class city-region, our human capital will continue to be a driving force. To be ready to fill the high skill, high quality jobs that will open up in the next decade, companies will need to find new ways to attract, develop and importantly retain the next generation of talent, so that we can continue to evolve our global competitive edge.
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