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Staffing Management: Up Front

By Carole Fleck  1/4/2007


Vol. 3, No. 2

Reach beyond the typical pool of candidates to recruit a workforce diverse in thought and experiences.

Enterprise Named Top Entry-Level Employer for Fifth Consecutive Year

For the fifth year in a row, the CollegeGrad.com survey results named Enterprise Rent-A-Car the No. 1 Entry-Level Employer. In announcing the Top 500 Entry-Level Employers for 2007, CollegeGrad.com notes that entry-level employers are increasing their hiring by 7.3 percent this year. Among the Top 500 Entry-Level Employers, 60 percent are planning to hire more college grads in 2007 than in 2006, 20 percent will hire the same number and 20 percent will be hiring fewer college grads than in 2006.

"It's a great time to be graduating from college," says Brian Krueger, president of CollegeGrad.com. The Top Entry-Level Employers list represents more than 170,000 jobs for the class of 2007, and is available online at www.CollegeGrad.com/topemployers.

With 8,000 projected entry-level hires for 2007, Enterprise Rent-A-Car is predicting a 14 percent increase in its 2007 entry-level hiring.

"Our experience in hiring for Enterprise's management training program has revealed the importance of showing candidates a true picture of our overall company and their potential career with us," says Marie Artim, assistant vice president of recruiting. "While the basics like pay, hours and benefits are still important and must be addressed, a candidate's decisions are often made based on the bigger picture-so we take care to highlight the values of our company, opportunity for advancement and more."

The list includes many return Top Employers from previous years, such as Lockheed Martin, PricewaterhouseCoopers, and Sherwin-Williams. New additions to the list include LabCorp, with 800 planned hires; Education Management Corp., with 625 planned hires; and CH2M Hill, with 300 planned entry-level hires.

Significant growth is being projected by companies of all sizes and in all industries throughout the list. Among the largest companies, PNC Financial Services Group is projecting a 31 percent increase in entry-level hiring for 2007. CIGNA is projecting an impressive 227 percent growth in hiring-going from 127 entry-level hires in 2006 to 415 in 2007.


Attention to Hiring Details Pays Off

Paying attention to the details of the hiring and orientation process pays off, says Ilene Gochman, an organization effectiveness expert for Watson Wyatt Worldwide.

In a review of human resources practices at 50 large U.S. companies, Watson Wyatt found that 65 percent of companies with a highly engaged workforce provide interview training for managers, vs. 33 percent of companies with a less-engaged workforce. Those with highly engaged workers also spend more time in preparing workers for their new jobs-they take an average of 35 weeks to bring a new hire up to speed, vs. 15 weeks for those with low engagement.

"Few things are more important to a company's long-term performance than choosing the right employees and ensuring that they have the proper outlook from day one," says Gochman. "As a result, employers should view the recruitment and orientation process as an opportunity, not as a burden. Preparing employees for their new roles and communicating how they can help the firm meet its goals can go a long way toward determining whether new employees ultimately succeed."

"Implementing effective recruiting and orientation programs is generally very cost-effective," Gochman says. "In addition, it is not terribly difficult to make changes in this area. The main requirement is to focus on improving communication, both to managers who do the hiring and to new employees themselves."

A simple but key technique for driving worker engagement is to explain to new employees why they were hired. Fifty-two percent of high financial performers said they provided such an explanation, vs. 29 percent of low financial performers.

"Sharing with new hires the attributes that drew the company to them is an easy and meaningful way to begin a productive relationship," Gochman says. "It gives new employees an immediate tie to the company and a clear understanding of how their skills can be used productively at their new place of employment."

Other Watson Wyatt studies have shown that building engagement in employees and establishing an efficient recruiting process are tied to financial performance. The 2006/2007 WorkUSA survey found that financial performance of organizations is strongly related to employee engagement. For the typical S&P 500 organization, a significant improvement in employee engagement is associated with a $95 million increase in revenue. In addition, Watson Wyatt's 2005 Human Capital Index study of 147 employers showed that firms that fill vacancies quickly-within about one month-have financially outperformed those that take longer to fill positions by 48 percentage points over a three-year period.


Pivotal Employees Play Key Role

Attraction, Retention of Pivotal Employees a Key Factor The attraction and retention of pivotal employees play a critical role in increasing shareholder value, according to research by Hewitt Associates.

Analyzing the HR data of more than 1,000 large U.S. companies and 20 million employees to determine the financial impact of human capital programs, Hewitt finds that the flow of pivotal employees-defined as employees in the top quartile of their peers in pay progression-into and out of an organization is a strong predictor of changes in cash flow return on investment and shareholder value.

Hewitt captures this information in the form of "talent quotient" (TQ), a human capital metric that quantifies the financial impact that pivotal employees make on an organization's business results. According to Hewitt's research, for the average Fortune 500 company, a 10-point increase in a company's TQ score adds approximately $70 million to $160 million to its bottom line over the next few years.

"Human capital continues to be the single largest investment a company makes, and now management can quantify the return on investment of its human capital and connect it to business results," says Mark Ubelhart, Hewitt practice leader, value-based management. "Companies need to make better, more informed decisions across the entire human capital spectrum. Just as an organization assesses its business conditions from a financial standpoint, it can now assess its human capital position-HR programs, practices and workforce-through TQ."

Hewitt's data by industry sectors show a range of TQ performance. For example, the financial services sector has TQ scores ranging from 86 to 138, the energy sector has scores ranging from 88 to 124, and IT has scores from 96 to 123.

"The significance of industry ranges for managers is in understanding their firm's TQ performance relative to talent competitors. A firm's track record in TQ directly reflects the effectiveness of its human capital investments, and also is a strong indicator of leadership bench strength and future success," says Samir Raza, an economist with Hewitt's talent and organization consulting practice.


Demand Strong For Certain Skilled Temps

The legal, computer and management fields are likely to be the ones most in demand for temporary workers over the next decade, Staffing Industry Analysts finds in its examination of the nation's temporary job market.

Demand for skilled occupations continues to grow robustly as a result of continuing low professional unemployment and a fundamental shift in the composition of the U.S. workforce, according to Staffing Industry Analysts' 2007 Temporary Jobs Guidebook.

"We predict that over the next 10 years, corporate America is likely to face a distinct challenge to find highly skilled workers to help them achieve their business objectives," says Barry Asin, chief analyst. "As a result, employers can expect rising prices for skilled temporary help and longer waits to find these workers. For temporary staffing firms, the demand for contingent workers will translate into a growth opportunity for the foreseeable future."

The 2007 Temporary Jobs Guidebook analyzes total employment, pay, and growth of more than 500 occupations.

The report finds that over the next decade total employment is projected to grow 1.2 percent annually, while contingent labor is expected to grow 3.8 percent annually. Over the last 16 years, total employment has grown 1.3 percent annually, while contingent labor has grown 5.2 percent.

Other highlights from the jobs guidebook include:

  • The top five occupations expected to experience the largest annual growth in temporary employment in the coming decade are all information technology-related. Demand for network systems and data communications analysts is expected to experience the greatest annual increase, growing a projected 8.5 percent annually.
  • Demand will be strong for office and administrative support, transportation and material moving and production workers. These three occupations are expected to account for nearly 75 percent of the demand for all temporary staffing.
  • Registered nurse is the most commonly placed type of skilled temporary professional.
  • Civil engineers are the most sought-after occupation. With just 0.3 percent unemployment, there is a severe shortage of civil engineers. Also in short supply are occupational therapists, pharmacists, respiratory therapists, physical therapists, meter readers, lawyers, procurement clerks and financial analysts. Unemployment rates for these occupations are all at 1 percent or below.

Hiring New Grads Has Benefits

Hiring ChartHiring new college graduates over experienced candidates gives a company the opportunity to mold its future leaders, say more than 86 percent of employers responding to the National Association of Colleges and Employers (NACE) Job Outlook 2007 survey.

More than 90 percent of employers also praised new college graduate hires for their enthusiasm and motivation, and more than three-quarters cited their ability to provide fresh ideas. In addition, 55 percent said new college graduates have cutting-edge skills to bring to the workplace.

"There is no doubt that there are distinct advantages to hiring both types of candidates-those who have been in the workforce for some time and those who are fresh out of college," says Marilyn Mackes, NACE executive director. "Companies that include new college graduate hires as part of their workforce planning strategy not only reap the immediate benefits associated with hiring new college graduates, but also sow the seeds for the future success of their organizations."

NACE's study also found that interest in hiring new college graduates is up this year; responding employers projected a 17.4 percent increase in their college hiring in 2006-07 over 2005-06.

"The increased interest means employers face more competition for their new college hires," says Mackes. "In fact, employers told us that competition is the number one challenge they face in hiring Class of 2007 graduates."

The Job Outlook survey is a forecast of hiring intentions of employers as they relate to new college graduates. Each year, NACE surveys its employer members about their hiring plans and other employment-related issues.


Worldwide RPO Builds Momentum

Terry Terhark, president and founder of The RightThing, predicts that worldwide recruitment process outsourcing (RPO) will build momentum in late 2007 then hit the industry to stay in 2008.

"Partnerships will emerge between U.S. and international RPO firms," says the head of the end-to-end RPO provider. "More and more contracts will include a global component. RPO firms in North America will develop a delivery model that supports most areas of the world."

Terhark believes that human resource outsourcing (HRO) firms will step up their partnerships with RPO firms to deliver recruiting and staffing services.

"HRO firms that have either built an in-house RPO delivery engine or have partnered with RPO firms will have a market differentiator," Terhark says.

"RPO firms are evolving their recruiting models to better match the customers' needs," says Jamie Minier, vice president of The RightThing. "Historically, RPO firms have been strong on process and weak on actual recruiting. Now, many RPO firms are building robust recruiting delivery capability. They're also building in-house expertise in many functional areas."

Other trends identified by The RightThing include:

  • Industry consolidation: With many firms entering the RPO space, look for definition and standards to emerge as the industry evolves. li> Larger contracts: As large corporations continue to recognize the strategic and business benefits of RPO, large contracts of this size and scope-and larger-will become more commonplace.
  • Demand for an RPO strategic partner: Companies will look at RPO firms as more than vendors. They will expect RPO firms to bring forth new ideas and fully understand a client's issues.
  • New recruitment skill sets: RPO firms will be continually asked to find ways to attract the passive non-job seekers.
  • Metrics: The demand will be to measure results as the key to identifying issues and make improvements before they become problems.
  • Technology: Specifically, RPO firms will provide the expertise for managing a process within a system and integration with other systems.
  • Reporting: The ability for companies to pull ad hoc, real-time reports is becoming the standard expectation-and at a reduced cost.

Carole Fleck is a writer in the Washington, D.C., area.

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