9/13/07 6:45 AM

Negotiating Power Continues to Shift to Job Candidates

By Kathy Gurchiek

Professional and technical positions are the most difficult to recruit for, as they were in 2006, and the employee-driven market is shifting the negotiating power to job candidates, according to the third annual Employment Dynamics and Growth Expectations (EDGE) Report.

Not only are employers having difficulty filling those positions, an increasing number this year are having difficulty filling director, manager, supervisory and team leader posts. Consequently, these also are the positions for which employers are most likely to increase compensation, the eight-page report found.

The findings are based on an online survey conducted from July 19 to Aug. 7, 2007, with more than 1,000 hiring managers and more than 900 full-time employees within the United States.

The United States faces a skills gap, U.S. Secretary of Labor Elaine L. Chao has said, and, as it did in 2006, the EDGE Report found more than half of hiring managers surveyed pointed to a shortage of qualified workers as their primary recruiting obstacle.

Ninety-one percent said it is equally or more challenging to find qualified candidates today compared with 12 months ago. In 2006, 81 percent said this was the case.

“To recruit successfully, companies must sell applicants on the benefits of working for their firms,” says Max Messmer, chairman and CEO of Robert Half International, a specialized worldwide staffing firm that commissioned the survey.

“Organizations that are adept at promoting the positive and unique aspects of their corporate cultures to prospective hires have a significant advantage over their competitors,” he said in a press release.

Money certainly gets their attention. About one in five hiring managers in 2007 said their inability to offer competitive salaries made it difficult to recruit qualified staff, although 37 percent plan to increase compensation for new hires, a finding consistent with 2006 responses.

“With an employee-driven market comes a shift in negotiating power,” said Matt Ferguson, CEO of CareerBuilder.com, which partnered with Robert Half on the survey.

“Workers are becoming more aggressive in demands for compensation and benefits with both current and potential employers.

More than half, or 58 percent, of employees said they likely would negotiate higher compensation if they were to accept a new job offer. In 2006, 29 percent said they would do so.

“But it’s important to remember,” Ferguson cautioned in a press release, “that while higher pay may help to initially appease the employee, it’s ultimately the overall work culture, sense of personal contribution and opportunities that keep an employee on board.”

Fewer hiring managers expect higher turnover rates in 2008 than those polled in 2006, the report found.

About one-third, or 31 percent, of hiring managers said their employers in the last 12 months have instituted new policies and programs to increase staff retention rates; these strategies primarily consisted of providing bonuses (23 percent), pay increases (16 percent), an improved office environment (15 percent) and a more defined career path (10 percent).

Hiring managers may want to pay heed to workers’ interest in work/life balance perks, though. Top perks that would cause them to choose one employer over another, said workers, were:

• Flexible schedules (65 percent).

• Telecommuting (33 percent).

• Employee stock purchase plans (33 percent).

• On-site fitness facilities (31 percent).

Kathy Gurchiek is associate editor for HR News. She can be reached at

kgurchiek@shrm.org.

Related Article:

U.S. Workforce ‘Vibrant’ but Faces Skills Gap, Chao Says, HR News, Sept. 10, 2007

For the latest HR-related business and government news, go daily to www.shrm.org/hrnews.