PROPERTY & CONSTRUCTION. Talent insights. Critical roles, skills and salaries to shape your team in 2017

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1 PROPERTY & CONSTRUCTION Talent insights Critical roles, skills and salaries to shape your team in 2017

2 The business context: Change is the new normal Organisations are under pressure from both internal and external factors, according to data from a Hudson survey of employers in New Zealand. Employers name their top 5 challenges for: The business 1 2 Increased customer demands Improving the digital customer experience 3 Compliance/regulation burdens 4 Increasing speed to market of new products and services 5 Collecting and analysing data Margins under pressure New Zealand employers say the biggest challenges facing their businesses are due to customer demands, which are impacting the property and construction market too. In a highly competitive environment, property and construction companies are under margin pressure, which is driving increased productivity expectations for staff and a strong focus on hiring people who can hit the ground running. A property and construction landscape in flux As the industry peaks and troughs, resourcing becomes more challenging. While government works have fixed budgets and timelines, the private investment sector is more volatile and subject to market fluctuations in interest rates, demand and bank funding changes. As a result, projects can be put on hold without notice, making for significant hiring challenges. Hudson research Nov 2016: employers, New Zealand 2

3 The workplace 1 2 Organisation or team restructures Implementing new technology platforms 3 Cultural transformation 4 New approaches to managing projects, eg Agile 5 Budget cuts Workplaces in transformation In property and construction, companies are seeking to diversify their capabilities to avoid or minimise the impact of market fluctuations. For example, we're seeing structural engineering consultancies expanding into civil engineering in order to create different income streams and be agile in response to business opportunities. This type of activity has a knock-on effect for resourcing, as companies are broadening the structures of their teams and the skills mix of their staff. With employers under pressure to manage through change, hiring is an opportunity to bring in people with a positive and adaptable mindset. The team Keeping employees engaged and motivated Retaining top performing staff Helping staff adapt to change Improving employee performance 5 Upskilling staff Employees looking for new opportunities New challenges and opportunities for progression tend to be high on the wishlist for property and construction professionals, so if they can't see career progression in their current workplace, they will look to new roles to find what they're looking for. Employers are now putting measures in place to retain top employees, however, they have to be careful not to overpromise on future opportunities as this will disengage employees if these opportunities don't eventuate. Keeping spirits up In the midst of change, employees can become frustrated and disengaged. In some markets, lack of resources and financial constraints are adding to pressure to property and construction employees, who are working at full capacity with little support. As their organisation shifts around them, employers have the responsibility to keep their staff engaged and motivated or risk losing their best people. 3

4 The demand for talent: Hiring intentions continue to increase NZ permanent hiring expectations: net effect (%) increase 38.5 % maintain 54.9 % Permanent hiring expectations: net effect (% of employers intending to increase headcount minus % of employers intending to decrease headcount). decrease 6.6 % 2017 For the last 10 years, Hudson has taken the pulse on employers' intention to hire. In H1 2017, the net hiring effect is heading upwards after remaining steady in In particular, hiring intentions have jumped significantly in the North Island compared to six months ago, while Christchurch remains strong despite easing slightly from the very strong numbers throughout With a strong economy and positive outlook, hiring intentions in New Zealand have continued to rise, and based on the economic outlook from the Reserve Bank and other economic commentators, strong employment conditions look set to continue. The Reserve Bank forecasts that in the absence of major unanticipated negative events (such as earthquakes), prospects look good for continued strong economic growth over the next 18 months. 1 The bank predicts that the unemployment rate will continue to decline and gross domestic product (GDP) should grow by around 3.75%, driven by construction spending, continued record migration levels, and tourism. 2 Some economic commentators have been concerned about a possible correction to the strong NZ dollar and booming house prices, however ANZ Bank economists say this seems unlikely given the continued underlying strength of the economy. 3 1, 2 New Zealand Reserve Bank Monetary Policy Statement, November ANZ Economic Outlook, October

5 Christchurch and Wellington lead hiring demand 40.8 % Christchurch 36.7 % Auckland Permanent hiring expectations: % of employers increasing headcount by region. 40 % Wellington With 93% of New Zealand employers either increasing or maintaining headcount, the competition for talent in 2017 is set to be highly competitive. Hiring intentions in New Zealand are strong, driven by a robust economy and prospects of continued economic strength in Roman Rogers Regional General Manager Recruitment New Zealand 5

6 Planning for your team: Feeling the talent pinch Employers are looking for people with the right technical and soft skills, as well as cultural fit for their team. How hard is it to find the talent that you need? of New Zealand employers intend to increase or 93 % maintain headcount Main hiring challenges but more than 1 in 3 say it's harder to find top talent than it was a year ago Finding candidates with the right cultural fit for your team Finding candidates with the relevant technical skills Finding candidates with the relevant soft skills Getting budget approval for a new/ replacement role Assessing candidates Hudson research Nov 2016: employers, New Zealand 6

7 Top 5 in demand: Roles Quantity Surveyor Structural Engineer Project Manager Civil Engineer Water and Transport Site Manager Technical skills Cost management Engineering design Project management Health and safety Project programming Soft skills Driving and managing change Innovative thinking Critical thinking Resilience Drive for results Growing demand for talent There is continuing growth in demand for talent across the market, fuelled by the need for more affordable housing in the main centres particularly Auckland as well as the commercial rebuild in Christchurch and earthquake strengthening in Wellington. Employers need to look beyond CVs Due to the technical nature of the sector, property and construction employers are placing a strong emphasis on technical qualifications, years of experience and project exposure when looking at CVs from candidates. This is leading to some organisations missing out on the best people because employers may be too focused on satisfying a specific project's requirements and overlooking transferable skills and capabilities. New Zealand experience a must We're also seeing that for many of property and construction employers, New Zealand-specific experience continues to be non-negotiable. This preference arises from a combination of the need for knowledge of New Zealand regulations for instance, earthquake regulations and the need to be able to engage local stakeholders. Talent pool shrinking With their laser focus on specific capabilities combined with the preference for local talent, the talent pool available to property and construction employers is becoming smaller. A strong focus on retention, plus the highly defined job requirements mean that the number of suitable people not to mention those that are available is, in our experience, extremely small. It's therefore likely that the competition for top talent will only increase in

8 Beyond the job ad: Winning strategies to source today's best talent The majority of New Zealand professionals are passive job seekers and consider themselves open to new opportunities, rather than actively looking for jobs. In the property and construction market, after a period of strong hiring activity in the second half of 2016, employees who have recently moved are settling into new roles. Many are also reluctant to move during a time of uncertainty from significant downsizing of insurance PMOs in Christchurch, as well as a plateau in new commercial projects. This also reflects a shift happening across New Zealand in the way that employers should approach sourcing top talent. They need to look beyond reactive job ads to get the best candidates in the market, not just the best available at the time. 41% H % are open to new opportunities Actively seeking 22% 35% H H Passive/open to opportunities 46% 24% H H Planning to stay 33% H A large number of potential hires might be interested in a role but aren't actively looking for jobs. 8 Hudson research Nov 2016: employees, New Zealand

9 Strategic sourcing for the best talent 1. Plan ahead Successful sourcing is built on knowing the roles you need, the talent you want and when you ll need it. Identify business critical and hard-to-fill roles, plus roles with high turnover. 2. Know who you want Develop a profile of the people you need, starting with their skills, competencies and experience. Then look beyond technical knowledge to consider motivations and cultural fit. 3. Be where your talent is There s an abundance of sourcing channels blogs, SEO, events, referrals, networking, associations, LinkedIn, video, traditional media, online advertising, job boards, databases and your next great candidate could be attracted through any of them. They could even be already within your organisation. 4. Sell a compelling employee value proposition (EVP) Understand what your target audience wants, then create an appealing employment offering that engages candidates throughout the hiring process. With job interviews an increasingly twoway street, candidates care about issues like social responsibility, flexible work options, diversity and corporate culture. 5. Access a talent pool Having ready access to a pool of qualified candidates will maximise your chances of finding top talent quickly when roles become available. 9

10 Attracting talent: What are job seekers looking for? Hudson's research shows that the majority of employees surveyed in New Zealand are most attracted to roles in companies where the work environment suits them, with enough flexibility for a good work/life balance and challenges to keep them motivated. What attracts job seekers to a company Work environment Work/life balance Challenging role Advancement 5 opportunity Chance to make a difference Ensure you have a compelling EVP Be clear about your employee value proposition. Only a compelling offer will lure top talent. If you can't offer the best salaries, ensure you have a compelling narrative about why people would want to work at your organisation. Hudson candidate engagement research 2016, New Zealand Just like employers look for good cultural fit, candidates are looking for a work environment that suits them. 10

11 Nurturing potential hires: Personalised communication is key Continuous engagement is essential to developing a relationship with a potential hire, even when a role is not yet available. When asked which channels were the most effective for engaging their interest, New Zealand professionals showed clear preferences. The best methods of continually engaging with prospective candidates: Professionals don't want you to reinvent the wheel when it comes to contacting them. Overwhelmingly, they prefer the tried and true methods of phone and % via personalised 49 % via company website 91 % via phone call 40 % via LinkedIn InMail Maintaining good relationships Ensure you provide a personalised, positive and consistent experience for candidates, from the point of initially engaging with them right through to the job offer. Hudson candidate engagement research 2016, New Zealand 11

12 The hiring process: A crucial factor in securing top talent A good quality hiring process is a chance to demonstrate your employee value proposition and is fundamental to a strong employer brand. If it's a disorganised or disengaging process, employees will assume that it reflects the workplace and steer clear. 85 % of New Zealand professionals believe that the experience with an organisation's job application and interview process is important when deciding to join a company The top 5 important aspects during the application and interview experience 1 Understanding the details of the position requirements Ongoing communication about application status Knowing the next steps in the process A reasonable time frame for a final decision Ease of application submission Hudson candidate engagement research 2016, New Zealand 12

13 Remuneration: Underpaid and underappreciated? Getting salary right is an essential part of the equation for hiring managers as they cope with the challenge of engaging and motivating employees. If people are feeling underpaid, they may also be feeling underappreciated. The answer? Communication and transparency. 39 % How much has your base salary increased by in 2016? 49 % Of those who received an increase, 77 % of New Zealand employees feel they are underpaid received no increase received an increase of 1-5% Ensuring salary satisfaction Refer to up-to-date salary data and clearly communicate that when making a salary offer to ensure continued engagement and job satisfaction. Alternatives to pay rises Employees say they would be willing to swap a pay rise for: 1. More annual leave 2. Bonuses and incentives 3. Flexible work conditions The Hudson Report: Forward Focus 2016 Hudson research Nov 2016: employees, New Zealand 13

14 Salary guide: Property & Construction Permanent Roles - Annual base salary 2017 NZD '000 Management General Manager Programme Manager Project Director Senior Project Manager Project Manager Junior Project Manager Senior Contracts Manager Contracts Manager Design Manager Site Manager Project Supervisor/Site Supervisor Cost Management Senior Quantity Surveyor Quantity Surveyor Junior Quantity Surveyor Estimator Civil/Structural Senior Structural Engineer Structural Engineer Civil/Structural continued... Senior Civil Engineer Civil Engineer Project Engineer Geotechnical Engineer Engineering & Design Traffic/Transport Engineer Traffic Management Supervisor Architectural/CAD Technician Property & Facilities Management Property Manager Facilities Manager Health & Safety Health & Safety Manager Health & Safety Advisor Estimator

15 This salary guide is a compilation of salary and market information provided by Hudson consultants, clients, candidates and other sources across New Zealand. Information was gathered by drawing on the extensive knowledge of our specialist recruitment consultants across Hudson s specialist practice groups. Salary ranges are approximate guides only. They relate to base salaries and exclude superannuation/ bonuses/incentive schemes/stock options.

16 Methodology Hudson undertook quantitative research with hiring managers and employees across New Zealand to analyse the talent landscape and provide insights on what employers might expect in 2017 and beyond. We canvassed the views of 1,529 New Zealand employers and employees in November From these findings we developed this report a combination of the survey findings and Hudson's specialist insights on the hiring landscape. We have also included data and insights from Hudson quantitative and qualitative research of 3,555 candidates from the Asia Pacific region undertaken in H to better understand the way that job seekers engage with recruiters and the job selection process. Percentages don't always total 100% as respondents could select more than one option for certain questions. Hudson Property & Construction Hudson's specialist recruitment consultants have the in-depth market knowledge of salaries, job titles and hiring trends to ensure you achieve the best outcome for your organisation at the appropriate remuneration. We build highly nurtured and engaged pools of select talent so you can find the right person quickly. This means greater speed and precision in placements, and higher satisfaction for both clients and candidates. Our proprietary assessment tools and techniques will help you find candidates with the right technical skills and capabilities for the role and for your team, so you can achieve higher performance and superior business results. nz.hudson.com