The US faces a long-term talent shortage, and few sectors feel this as acutely as Financial Services and Insurance (FS&I). A significant proportion of the US workforce is set to retire within the next two decades: 10,000 workers are expected to reach retirement age each day, every day, for the next 19 years. Meanwhile, the sector faces real challenges in trying to replace them. Millennial and Gen-Z talent doesn’t always have the same priorities as previous generations, and recruiting them, and talent with digital expertise, is crucial for firms getting to grips with rapid digitization. Recent research from Korn Ferry suggests that talent shortages in financial services worldwide could result in $1.313 trillion in unrealized revenue, with the US sector due to suffer most, to the tune of $435.69 billion; one third of the global total.
The candidate journey
If financial services and insurance organizations want to meet these talent challenges, they need to start right at the source by addressing the recruitment process and the candidate journey. If we look at this through the traditional stages and touchpoints – awareness, consideration, interest, application, selection, hire and onboarding – then there are changes HR teams could think about at almost every stage.
Take awareness. Is your organization reaching all the potential candidates it could, and are they the right candidates for the roles you’re trying to recruit for and the skill gaps you’re trying to fill? Or how about the interest and application phases? Are you engaging with those candidates in a way that draws them in, or are you encouraging them, however inadvertently, to look elsewhere?
When it comes to selection, are you screening out candidates who would have the traits and skills you need, just because they don’t meet specific criteria that might no longer apply to the role? By recruiting the way you’ve always done, are you missing out on talent that could be enhancing your business, and leaving them to be found by a forward-thinking rival or disruptive Fintech startup?
Driving awareness and consideration
There are solutions. For a start, you can broaden your talent pool, building relationships with schools, colleges and communities beyond the traditional hunting ground. Events, outreach programs and sponsorships can all be tools to build awareness and develop it into consideration and interest. Oftentimes, however, this might mean reconsidering the profile you’re projecting to candidates entering the workforce, and whether it’s attracting their interest or putting it off. There’s plentiful evidence that a sense of purpose and diversity, not to mention clear social and environmental policies, can make a difference to millennial and Gen-Z candidates.
Organizations that can communicate and demonstrate the right values will have an advantage on recruitment, so every touchpoint from the careers section of the corporate website to social media postings becomes all the more important. That doesn’t make a rounded remuneration package and flexible work options any less crucial, though. Candidates with the most valued skills and traits – particularly data skills – will have a choice of opportunities. They may even pursue several simultaneously. They need to believe that your firm is a good match for them, or some shiny new Fintech, or even a completely different industry sector may look more attractive.
Improving selection and hire
Perhaps most importantly, FS&I organizations may need to rethink the selection phase, where a skills-based approach and new data-driven, AI-enhanced processes could bring more and different candidates to the surface. With solutions like Beamery, Talent Acquisition teams are able to filter searches and segment candidates for different roles, and create pools of talent aimed at bridging specific skills gaps. When HR teams are overwhelmed with applications, AI and automated workflows can assist them in narrowing down their search, while also counteracting bias. For instance, McKinsey talks about how, through data-driven insights, one financial services firm found that, for some sales roles, certain personality traits were more indicative of success than prior experience. This was enough to change the way those candidates were selected.
What’s more, this approach enables firms to be predictive and proactive, maintaining talent pools of candidates that are ready to go, so that future needs can be met at faster speeds. In a world where financial institutions are often competing for the top talent, moving faster, and having the right data to hand can make all the difference.
The traditional recruitment process and candidate journey has worked for many years, but roles and requirements within FS&I are changing, and there’s never been so much competition for top talent in the sector. It’s not time to junk these established workflows, but it is time to retool them.