Saskatchewan HR Trends Report Spring 2017

Transcription

1 Saskatchewan HR Trends Report Spring 2017 PURPOSE OF THIS REPORT This report is a tool for HR practitioners and their organizations in Saskatchewan to make informed decisions with reliable information on what is occurring in Saskatchewan s workplaces. Reliable labour market information can help human resources professionals make better business decisions in giving human resources information and advice to their stakeholders. The Chartered Professionals in Human Resources (CPHR) Saskatchewan has commissioned this report to help fill the labour information void for its members and to discover industry benchmarks that will assist human resources professionals to make better talent management decisions. This is the third report in the series and trends are now beginning to emerge. HIRING CONFIDENCE INDEX Saskatchewan s Hiring Confidence Index was created to measure how Saskatchewan employers feel about hiring over the next six months. The Index emphasizes how confident HR professionals are in hiring the right people to fill vacant positions; the Index also incorporates views on growth in the number of positions. The Index is made up of both an expectation of hiring levels over the next six months and the confidence respondents have in finding the right people to fill vacancies. The scores have a maximum value of 100 and a minimum value of 0. Scores of more than 50 mean HR professionals are more confident, than concerned, about hiring. Hiring Confidence Index Overall Small Medium Large Jan-Jun 2016 Jul-Dec 2016 Jan-Jul

2 After a big drop in the last report, Saskatchewan s Hiring Confidence Index score has rebounded, primarily due to large organizations scoring significantly higher. Small and mediumsized organizations saw increased confidence as well, particularly small ones. THE 6 MONTH OUTLOOK Since the last report, organizations in Saskatchewan are significantly more likely to expect an increase in their headcount in the next six months. In late 2016 the 23% who expected growth were nearly balanced by the 22% who expected to lose employees. Now 29% expect growth and expect to lose team members. Large organizations are still the most pessimistic, and more so than last time with only 14% expecting growth and 29% forecasting they will lose employees. Small organizations did not report a meaningful change from the last report, but medium-sized organizations are significantly more likely to be optimistic and are the most likely to expect growth. Expected Change in Employment Overall - Jan-Jun % 16% 48% 8% 6% 9% Overall - Jul-Dec % 5 1 6% Overall - Jan-Jun % 1 41% 11% 9% Small Organizations 16% 14% 52% Medium Organizations 18% 18% 44% 6% 6% Large Organizations 11% 24% 26% 13% 24% Increase By More Than Increase By Less Than Stay The Same Decrease By Less Than Decrease By More Than Don't know

3 Termination without cause is still the most common expected reason to lose employees in the next three months - and is essentially unchanged from last time. Resignation for a better opportunity and retirement, two signs of an improving economy are both more likely than the last report (+ and +3%, respectively). CURRENT TRENDS 18% Only a quarter of organizations in Saskatchewan reported gaining 1 Other employees over the last six months. This 11% was just larger than the proportion who reported a net loss of headcount (21%) and shows how finely balanced the Saskatchewan labour market is. Small organizations saw a net decrease in employment with 2 reporting a shrinking headcount, greatly exceeding the 16% who posted a net gain. This was a worse situation than the previous report. Mediumsized and large organizations were more likely to report a gain in employees than they were in the first half of 2016, however despite this, large organizations were still more likely to shed jobs than create them. 2 21% Expectation for the biggest reason to lose staff in the next six months 12% 23% Percentage reporting net increase in employment 22% 24% 31% Termination without cause Retirement Termination for cause Resignation for personal reasons Resignation for a better opportunity Small and large organizations both lost employees, while not in great numbers, both were worse than in the previous report. Medium-sized organizations did the best in gaining employees and losing the fewest contractors. Jul - Dec 2015 Jan - Jun 2016 Jul - Dec % Small orgs Medium orgs Large orgs

4 Employees Small organizations Medium organizations Large organizations Joined in last six months Left in last six months Net Employees Contractors Joined in last six months Left in last six months Net Contractors TERMINATION CAUSES Times have changed in Saskatchewan s labour market. In the last report, Termination without cause was essentially tied with resignation for a better opportunity, as the common reason for employees to leave. Now 39% say that Termination without cause is the most common reason for leaving overall in most employee categories. It became the most common reason for departures in all job categories listed which include professional, technical, administrative, management and tradespeople. Interestingly, retirement increased slightly as a reason for leaving and is now the most common reason among executives. It actually edged out termination without cause, which was the most common reason in the last report. The most likely explanation for this is that some executives have been accepting early retirement packages, offered as an alternative means of reducing headcount to termination without cause.

5 Category of Employee Executives Managers Professionals (i.e. engineers, accountants, HR) Technical Staff (i.e. designers, technicians) Tradesperson or Journeypersons Administrative or support staff Most Common Reason to Leave Retired Termination without Cause Termination without Cause Termination without Cause Termination without Cause Termination without Cause 23% 13% 21% 18% Most Common Reasons for Leaving 2 24% 18% 18% % 18% 39% Jul - Dec 2015 Jan - Jun 2016 Jul - Dec 2016 Resignation for a better opportunity Resignation for personal reasons Termination for cause Retirement Termination without cause Nearly two-thirds (6) of HR managers are confident they can fill vacancies with workers who 3% have equivalent experience and qualifications. Only 3% are very 11% worried about finding qualified replacements. The overall level of confidence has increased dramatically, particularly those 21% who are very confident (+9%). Those who are moderately worried about finding replacements with the equivalent experience and qualifications have dropped significantly. Confidence in replacing workers with equivalent experience and qualifications 2 41% Very confident they will have equivalent experience and qualifications Moderately confident they will have equivalent experience and qualifications Neither confident nor worried Moderately worried they will not have equivalent experience and qualifications Very worried they will not have equivalent experience and qualifications

6 TEMPORARY LAYOFFS Temporary layoffs are becoming increasingly common in Saskatchewan. Nearly three in ten organizations report engaging in the practice (up 6%). The biggest increase is among large firms, nearly half of whom (46%) engaged in temporary layoffs in the last six months. This is a substantial increase (from 32%), however similar jumps were not found among small or medium-sized organizations. Have engaged in temporary layoffs in the last six months Jul-Dec % 8 2% Jan-Jun % 76% 2% Jul-Dec % 68% 4% Small 16% 84% Medium 26% 7 Large 46% 46% 8% Yes No Don't know While slightly more workers did return to work (84%, up from 81%) in the last six months, those that did return, took longer to do so on average. Nearly two-thirds (64%) returned to work in under six months, this is lower than the 71% who did so in the previous report. Length of time laid off before being typically called back to work Jul-Dec % 28% 28% 16% Jan-Jun % 26% 39% 6% 3% 19% Jul-Dec % 24% 36% 16% Less than one month One to three months Three to six months Six months to a year Over a year Never

7 FILLING VACANCIES The expected pattern of more specialized positions taking longer to fill remains true in Saskatchewan in the last six months. In the last report, we noted that while the time required to replace higher paid roles like executives and managers had remained constant, filling vacancies for lower paid roles was considerably faster as the softening of the job market made more viable candidates available. In this report, the executives and managers have caught up with the other staff both saw their vacancies filled considerably faster. 5 of executive and 76% of managerial positions are now filled within three months. 3 18% Executives 3 Less than a month Between a month and three months Between three months and six months Between six months and a year More than a year 16% 1% Managers 6 21% 2% Professionals Technical Staff Tradespersons and journeypersons Admin Staff 49% 43% 42% 54% 1% 2 4 2% 44% 2% 1% 43% 2% HR TEAM RATIO Respondents were asked to provide an approximate ratio of HR employees to overall employees in their organizations. The ratio is very dependent on the size of the organization, with small organizations having one HR person per 39 employees and large ones with a ratio of 140 to 1. Medium-sized organizations had an average ratio of 108 to 1. The ratios did not change from the last report for small and medium-sized organizations but increased considerably for large ones.

8 LEARNING AND DEVELOPMENT On average, organizations are investing 3. of their total budget towards learning and development. This level is remarkably consistent across all sizes of organizations. The amount devoted to learning and development has not significantly changed since the last report. % of Budget Allocated to Learning and Development % 3.6% % Jul-Dec 2015 Jan-Jun 2016 Jul-Dec 2016 Small Orgs Medium Orgs Large Orgs TURNOVER COSTS AND RESPONSE In Saskatchewan, only a third of organizations (32%) report not being impacted by employee turnover. The most common impact, cited by more than a third (3) of respondents is longer hours for remaining staff andnot being able to take on certain projects was also a significant impact of turnover. The other impacts were significantly less common.the proportion of Impact of turnover in the last year % % 31% % 1 19% 9% 11% 12% No Impact We have not been able to grow as fast as planned We have not been able to take on certain projects We have not hit revenue targets We have had to delay projects for clients Longer hours for remaining staff Jul-Dec 2015 Jul-Dec 2016

9 organizations who are not impacted by employee turnover has dropped significantly (43% to 32%). Employee turnover is expensive and getting more so. In Saskatchewan, the costs saw a significant increase over the last year from just over $15,000 to above $19,000, an increase of $4,000. The processing cost includes the time of the HR team; working with recruiters, severance, separation pay, the interview process and the required regulatory requirements. The cost of processing is highest among large organizations ($29,220). The significant increase in the cost is present across all organization sizes, though it was largely driven by a more than $12,000 increase in the costs of turnover within large organizations. Estimated average total cost of processing an employee turnover $29,220 $15,140 $19,150 $15,950 $18,010 Jul - Dec 2015 Jul - Dec 2016 Small Org Medium Org Large Org The most popular actions organizations reported taking to reduce turnover include better onboarding, flexible work arrangements and working to improve team culture which include more team building events. These most common actions have not changed in a meaningful way in the last year. It is very interesting that the most popular actions taken to reduce turnover are essentially non-monetary. Employers clearly believe that better processes when an employee is hired and listening to their employees' need for flexibility is more effective than higher wages or better benefits. The popularity of better onboarding, in particular, speaks to intelligent HR practices - an employee that is set up to succeed with a positive work environment is far less likely to leave.

10 Actions taken to reduce turnover for any reason Better on-boarding Flexible work arrangements More team building events Higher wages Better benefits Job sharing Flexible work location More vacation Reduce travel requirements Living allowances Offer partial retirement options Outsourced functions Signing bonuses Replaced supervisors with high turnover Stock options Other None 11% 9% 3% 2% 1% 6% % 3 41% HR BUDGET CHANGES HR departments are generally optimistic in Saskatchewan about their HR budgets. 31% expect their HR budget to increase in 2017, while 23% expect their budget to shrink. The larger an organization becomes the more likely they are to expect a shrinking HR budget. Among organizations with more than 1,000 employees, 44% expect a smaller budget, and only expect a larger one at the end of the year. Expected HR Budget changes for % 8% 12% 3% 8% 13% 1 28% 33% 16% 2 2 8% 1 13% 1 13% 16% 16% 14% 14% 14% 8% 4% 2% 6% 12% Small Orgs Medium Orgs Large Orgs Significant increase (more than +) Moderate increase (+2% to ) Minor increase (+0. to 2%) No change (+0. to -0.) Minor decrease (-0. to -2%) Moderate decrease (-2% to -) Significant decrease (More than -)

11 HR CONSULTANTS About a quarter (26%) of organizations in Saskatchewan employ external HR consultants. This is more common with large organizations (4), perhaps due to more specialized HR needs Does your organization employ external HR consultants? 66% 58% 26% 26% 22% 78% 44% Among those who use external HR consultants the primary reason they were employed was to access specialized and expert knowledge to contribute to a specific project (8). They were rarely used to fill fractional HR staffing requirements or develop and implement HR policies for the organization. That said small organizations are more likely to use an external HR consultant to develop HR policies and use them to cover fractional HR staffing needs. 4 Sask Small Orgs Medium Orgs Large Orgs Yes No What is the primary reason for employing an HR consultant? 8% 12% 8% 1 6% 8 69% 82% 9 3% 8% Sask Small Orgs Medium Orgs Large Orgs Other Develop and implement HR policies for your organization Access specialized and expert knowledge to contribute to a specific project Fill fractional HR staffing requirements

12 In Saskatchewan, the most common factor in choosing a consultant was their HR-function expertise (6), followed by industry-specific experience (28%). Network referrals are more common within small organizations, while medium-sized organizations are more likely to hire someone due to their HR-function expertise What was the primary factor in your choice of consultant? 46% 6 71% 6 31% 28% 3 24% 23% 13% 6% Sask Small Orgs Medium Orgs Large Orgs Someone from my network Industry specific experience HR-function expertise Recommended by an association or agency HR SOFTWARE AND ANALYTICS HR specific software like Halogen, UltiPro and Adobe, is not commonly used across organizations in Saskatchewan. Only 18% report using it for recruitment or hiring and absence management, 1 for analytics and performance records and management, and 16% for scheduling and employee self-serve. In contrast, office software like MS Office, MS Dynamics and SAP are most commonly used for nearly all tasks, even highly specialized HR tasks. External service providers like Ceridian and ADP are only used by a small minority of respondents, with the most common tasks being employee self-service (16%) and recruitment (16%). With more generic office software being used for most HR tasks it shows there is room for significant growth in the use of HR specific software.

13 33% 3 34% Tool used for HR functions 3 31% 31% 38% 23% 26% 18% 16% 1 12% 6% 16% 16% 16% 12% 18% 14% 14% 6% 8% 3% 1 1 Recruitment /Hiring Performance Records & Management Retention /Recognition HR Planning /Strategy Employee Self-Service Scheduling Absence Occupational Management Health & Safety Grievances Analytics HR Specific Software (e.g. Halogen, UltiPro, Adobe) Office Software (e.g. MS Office Suite, MS Dynamics, SAP) Is your organization receiving sufficient return on investment from your HR specific software? 2 19% 33% 31% % 19% 3 6 Sask Small Orgs Medium Orgs Large Orgs Yes No Don't know Even though HR specific software is only used by a minority of respondents, the satisfaction levels are significant. 4 of respondents say they are receiving a sufficient return on investment, while only 19% feel they are not. Satisfaction is higher with large (6) organizations. In comparison, far more respondents feel they are getting a sufficient return on investment from their external service provider (69%). Small organizations (73%) are more

14 satisfied and large organization are slightly less likely to be (64%) and to more likely not to be sure (21%) Is your organization receiving sufficient return on investment from your external service provider? 13% 8% 3% 13% 69% 73% 7 21% 64% Sask Small Orgs Medium Orgs Large Orgs Yes No Don't know The most common barrier to effectively using their HR specific software is the quantity and cost of customization required followed by the difficulty of integrating with other business software. This makes sense particularly in large organizations who are more likely to use more complex and custom business applications which makes integration more complicated. Lack of end user training is also a significant factor for 13% of respondents. What is your organization s biggest barrier to effectively using their HR specific software? Frequency of updates needed to the software 9% 2% 4% 13% 2 Quantity and cost of customization/configuration required Difficulty integrating with other business software Cost of the Software as a Service (SaaS) agreement Cost per user licence 9% 2 Lack of effective end user training Lack of responsive end user support from the software provider/vendor/developer End users are resistant or reluctant to adopt the software in their regular business processes Concerns related to data security and privacy

15 Almost half (46%) of organizations can provide all the needed metrics to senior leadership. Many (28%) can only provide some of the metrics needed. Impressively only cannot provide the metrics requested, a number which drops to in large organizations Can you provide senior leadership with the HR metrics they need? 8% 13% 12% 4% 43% 28% 28% 21% 4 46% 46% 4 43% Sask Small Orgs Medium Orgs Large Orgs Don t know No, as senior leadership does not specify needed metrics No, we can t provide the needed/requested metrics No, we can only provide some of the needed/requested metrics Yes, we can provide all the needed/requested metrics SOLVING PROBLEMS In the last year, 46% of organizations in Saskatchewan have filled their vacancies by both posting job vacancies publicly and using other sourcing methods. An identical share (46%) relied on only public posting. Smaller organizations are more likely to rely on only public posting than both public posting and using other methods. Overall public posting dominates as the most common way to fill vacancies, but most organizations supplement this with other methods.

16 10 How do you fill vacancies? 1% 4% 46% 51% % 4% 3% 46% 44% Sask Small Orgs Medium Orgs Large Orgs Don t know Have not had any job vacancies to fill Organization both posted vacancies publically and used other sourcing methods Organization used only alternative sourcing and recruitment methods (e.g. did not post to fill vacancies) Organization posted vacancies publically Do you have an ameliorative program for the following underrepresented groups? 26% 26% 52% 54% 1% 33% 58% 1% 8% Women Visible Minorities Foreign Educated professionals 23% 28% 26% 46% 3% 28% Indigenous peoples 63% 1% 8% LGBTQ persons 53% 22% Persons with disabilities Currently have an ameliorative program Have had an ameliorative program in the past Do not have an ameliorative program Ameliorative programs for underrepresented groups are not very common in Saskatchewan organizations. No matter the group, at most 28% of organizations have an ameliorative program. The most common beneficiaries are indigenous peoples (28%), persons with disabilities (22%), women and visible minorities (). Leadership programs for these same groups are even less common. 1 of organizations have a leadership program for indigenous peoples, and 1 have one for women. N/A

17 Do you have a leadership program for the following underrepresented groups? % 28% 31% % 1% 1 12% 2% Women Visible Minorities Foreign Educated professionals 52% 3% 1 Indigenous peoples 6 5 1% 1% 11% LGBTQ persons Persons with disabilities Currently have a leadership program Do not have a leadership program Have had a leadershiip program in the past N/A PAY EQUITY Only 18% of respondents believe their organization has a gender wage gap. This belief is highest within medium-sized organizations (26%) Do you believe that a gender wage gap currently exists within your organization? 12% 9% 6 18% 78% 11% 62% 26% 24% 5 19% Sask Small Orgs Medium Orgs Large Orgs Yes No Don t know

18 The top 3 actions that respondents believe that can improve pay equity are primarily about communication. The most common recommended action - clearer communication on how bonuses, cost of living increases and raises are determined (54%) and clearer communication on how overall compensation is determined (5). These are both relatively easy to implement, howeverrequires organizations to get over the taboos on talking about compensation at a group level. It is also worth noting that 46% believe greater internal pay transparency (46%) and government policies and legislation (38%) will help as well. Top 3 actions you believe that can be taken to improve pay equity Clearer communication on how pay raises, COL increases and bonus are determined Clearer communication as to how total compensation is determined 5 54% Greater internal pay transparency 46% Government legislation requiring employers to pay all people equally for equal work Company commitment to increase the number of women in senior leadership New company policies around pay and compensation Greater public education and awareness about the gender pay gap Greater enforcement of human rights legislation prohibiting discrimination on the Don't know 12% % 38% Other

19 Does your organization internally make available to employees the pay-ranges for all organizational roles? 2% 1% 4% 43% % 38% 3 39% Sask Small Orgs Medium Orgs Large Orgs Yes No Don t know Speaking to that need for clearer communication, 38% of organizations report making paybands/pay ranges for all organizational roles available to all employees. This practice is much more common among large organizations (52%). In the same vein, less than a third of organizations (31%) have ever conducted a pay equity audit, which perhaps undermines the large number of respondents who do not think their organization has a gender wage gap. Pay equity audits are more common among medium-sized organizations Has your organization ever conducted a pay equity audit? 2 32% 48% 34% 32% 29% 19% 28% 31% 4 33% 1 Sask Small Orgs Medium Orgs Large Orgs Yes No Don t know

20 TRENDS IN HR Respondents were also asked to identify trends impacting their work in HR including government policies. While there were too many to enumerate, here are the most popular and significant: Changes to labour laws The general economic slowdown Immigration and the Temporary Foreign Workers Government funding cuts

21 METHODOLOGY This survey was conducted online between November 30 and December 22, ,244 members of CPHR Saskatchewan were invited to participate via an . Of these 252 completed enough of the survey for their responses to be useable, a response rate of 20.3%. 143 respondents completed every question, a completion rate of 11.. The margin of error of this survey varies depending on the number of completions each question received. The margin of error varies between +/-5. nineteen times out of twenty and +/- 7. nineteen times out of twenty. The data for the previous report was collected in June Due to rounding, some numbers may not add up. RESPONDENT PROFILE The respondents come from organizations of all sizes from sole proprietors to multinational corporations. The median number of employees in Saskatchewan per organization is 300 and the average number of employees is 1,303. In this report, small organizations are ones with fewer than 100 employees, medium have between 100 and 999 and large have 1,000 or more employees. Respondents were also distributed across a wide range of sectors. Self-employed Number of employees 4% 1 to to % 500 to % 1,000 to 9,999 23% Over 10,000 4% Due to the sample size individual sectors could not be broken out with separate results. Respondents work in all sorts of roles within their organizations, but generalists and managers were the most common.

22 Distribution by Role Generalist Manager / Supervisor Consultant Specialist Director / AVP Coordinator / Administrator Student Currently unemployed SVP / C-level VP Non-HR function Retired Other 5.6% 3.2% 2.8% 2.4% 2..8%. 2.8% 15.3% 11.2% 10.4% 23.3% 20.1% FURTHER INFORMATION CPHR Saskatchewan is the premier professional association for human resource professionals and is the Chartered Professional in Human Resources (CPHR) granting body within the Province of Saskatchewan. For more information contact: Phone: kmazurak@cphrsk.ca For inquiries regarding the survey and analysis, contact: Nicole Norton Scott, BBA, CPHR Executive Director & Registrar Phone: nnortonscott@cphrsk.ca For inquiries regarding the methodology and survey tool, contact: Hamish I. Marshall Torch Phone: