Andrew Eppich is the managing director for Equinix Canada, the world’s digital infrastructure company.
The competition for skilled talent in Canada is continuing to accelerate, with the majority of organizations (70 per cent) seeing this shortage in skilled workers as a major barrier for success, according to Equinix’s Global Tech Trends Survey. On the flip side, amid greater market volatility today’s workers are re-examining what their total compensation looks like (or how they want it to look) and how to handle increased economic pressures and cost of living.
Things like rising food costs, higher rents and skyrocketing home ownership prices are placing increased strain on workers and companies across the country, especially in two of Canada’s leading hubs for innovation - Vancouver and Toronto.
With both sides feeling the strain, what can be done to help close the talent gap while helping to alleviate the economic pressures?
Talent intelligence
Businesses best positioned to address these concerns are the ones most agile and able to adapt to the shifting economic realities. The key to achieving this level of agility and adaptability is data.
Talent intelligence is a process for collecting and analyzing employee, candidate and external information to identify actionable insights that inform hiring decisions. It is quickly becoming a critical tool for businesses to hire and retain top talent.
Leveraging internal and external data to inform hiring strategies in real-time can better identify skills gaps, manage employee churn and offer compensation packages tailored to the economic realities of key markets. Data sources can include candidate data from internal and former employees, employee surveys, corporate culture surveys, performance reviews, skills assessments and social media profiles.
External salary benchmark
For organizations looking to begin using talent intelligence to improve their agility in hiring strategies, an external salary benchmark is a good place to start. An external salary benchmark can help businesses understand how to pay enough to avoid losing talent to the competition, but not so much that they inadvertently contribute to the inflationary cycle in the industry.
For example, Toronto, Montreal and Vancouver are often cited as the country’s leading tech centres, but innovation runs far deeper in Canada than the three biggest cities. Metropolitan centres like Ottawa-Gatineau, Saint John-Fredericton, Kitchener-Waterloo and Calgary have been establishing themselves on the world stage as growing tech hubs, drawing some of Canada’s most skilled talent. Part of the draw of these smaller innovation centres is often a lower cost of living compared to Toronto and Vancouver.
An external salary benchmark can give hiring managers a clearer perspective of how their total compensation packages compare to competitors as well as identify the appropriate market rate of each role in each area. By analyzing the external data from industry analysts or third-party recruitment consultancies that outline hiring trends and metrics, such as cost-per-hire, time-to-fill and quality-of-hire, organizations can better tailor compensation packages and incentives or rewards to better retain high-performing employees and recruit new skilled staff.
All about the benefits
Financial compensation is only one factor involved with bringing in (and holding on to) great talent: benefits and incentives have become key to securing a competitive edge in hiring. According to the Global Talent Trends 2022-2023 report from global talent consultancy Mercer, 94 per cent of Canadian businesses are focusing on how their benefits offerings can better support employee attraction, retention and engagement this year.
The same study found that more businesses in Canada are expanding benefits to more employees, as well as offering greater flexibility, mental health and well-being support, with 38 per cent of businesses planning to expand benefits to be more supportive of all segments of the workforce this year.
In addition to analyzing external data to stay competitive, it is as critical to have informed discussions with employees about salary decisions and how to prioritize benefits to better retain top talent. Leveraging external salary benchmarks as well as internal data can help organizations stay up to date on future hiring trends including employee well-being benefits, to finetune their overall compensation packages.
With the rising costs of living, shifting employee preferences and tougher competition for top talent, compensation packages will only continue to evolve. Applying data driven insights to hiring and retention strategies, including use of an external salary benchmark, will play a critical role in staying ahead of trends and engaging the kind of talent that drives a business forward.
The battle for skilled tech professionals is only going to intensify, especially as we move to an increasingly digital working world. Organizations that stay ahead of emerging hiring trends and maintain open dialogue with their employees to better understand their evolving needs and expectations will come out on top.
This column is part of Globe Careers’ Leadership Lab series, where executives and experts share their views and advice about the world of work. Find all Leadership Lab stories at tgam.ca/leadershiplab and guidelines for how to contribute to the column here.