Impact of Changing Labour Market Conditions on Resourcing Decisions
Variations in the labor market significantly impact the resourcing strategies of companies like Sun Energy as global energy resources shift to accommodate sustainable energy sources. On the other hand, Parcelcare, like any other organisation, is also impacted by numerous external factors that affect its resourcing decisions. These conditions can be classified into two categories: those related to tight labor markets and those related to labor surpluses. These categories play a crucial role in determining how companies source, manage, and plan their human capital.
Tight labour markets vs. Loose labour markets
A tight labour market is characterized by many job vacancies compared to the number of unemployed individuals seeking work, indicating talent scarcity. This condition compels organisations to adopt more competitive staffing policies that enable them to attract and retain quality employees. This often makes firms desirable by raising pay, introducing more perks, and improving employees’ treatment. For instance, in the era of the late 2010s, driven by the tech frenzy, Amazon boosted basic wages, handing out generous signing bonuses, and liberally bestowed generous fringes that included flexible working hours, professional development training, and welfare programs to attract critically wanted tech staff (Smith, 2019). Furthermore, when the labor supply is low, or there are few applicants, companies may invest significantly in employer branding and employee satisfaction programs to lower turnover rates and strengthen their workforce. For instance, despite the stiff competition from other firms for talent developers, Salesforce implemented trade skill development initiatives and an intense organisational culture with values and contributions to the community; this aided Salesforce in engaging and maintaining the best talent (Johnson, 2020).
On the other hand, Loose labour market refers to a state where many job seekers compete for a limited number of job openings. These conditions enable organisations to be more selective when employing persons for specific positions and frequently provide diminished compensation. For instance, during the great recession in 2008-2009, there was a high supply of applicants in most industries, so companies could offer lower wages and lean on benefits without negatively affecting the quality of applicants they hired (Brown, 2010). Moreover, in addition to changes concerning the number and rate of payment, organisations in environments characterized by a high degree of labour market mobility might seek to minimize costs more intensively and pursue improved efficiency of operations. For example, some organisations, especially in the private sector, found themselves with a new reality of high unemployment rates due to the COVID-19 crisis, which led them to downsize their workers, freeze hiring, or actualize strict performance management regimes to ensure those who remained delivered good results (Green, 2021). The demand and supply of labour within organisations are determined by factors such as industry demand, technology, and demography (Taylor & Woodhams, 2012). For instance, with the enhancement of technologies such as automation and the use of digital solutions, organisations pursue employees who possess knowledge in the technology sector, resulting in the continuing process of reskilling and upskilling the workforce.
Additional Factors to Consider
Globalization
Despite creating an opportunity to explore new markets, globalization has also increased competition and demand for more talent while increasing pressure on the delivery industry to provide smooth and reliable services (CIPD, 2018). For a delivery company like ParcelCare, globalization significantly impacts talent resourcing. This means having the ability to hire and retain individuals from around the world who can serve as customer care representatives in various languages. It also involves bringing in experienced logistics professionals who may be located in different countries. As the talent pool becomes increasingly diverse, initiatives like DEI should be a top priority in employee retention strategies to enhance competitive advantage in the labor market. Additionally, ParcelCare may have to offer competitive wage structures and benefits to attract foreign skilled labour.
Flexible working
Another evolving condition is the recent emergence of the option of flexible working. It is a recent development that employees are increasingly prioritizing work-life balance. Consequently, businesses that offer flexible work arrangements, such as allowing employees to work remotely most of the time, a shorter work week, or hybrid working, can gain a competitive edge in the labour market. With flexible working practices, many organisations have offered a better work-life balance, consequently reducing absenteeism and increasing productivity. In the renewable energy sector, companies can easily offer remote activities such as project management or research and development, leveraging this flexibility to attract forward-thinking employees.
Demographic Shifts
The UK labor market is experiencing such a tremendous demographic change, especially the older labor force and the more dominant Millennials and Generation Z, that it cannot escape unscathed, with pensioners in capacity shortages or even a few years later. The aging population means that a very important part of the workforce will be on the brink of retirement, thus coming up with a lack of qualifications and the need for replacement planning (Office for National Statistics, 2022). On the other hand, however, Millennials and Gen Z, who tend to have the preferred work-life balance and seek career development, have begun to comprise the backbone of the workforce (CIPD, 2023). ParcelCare can address these shifts by implementing targeted strategies for different generational needs. For the aging workforce, offering phased retirement options, flexible hours, or part-time roles can be a way of keeping experienced employees while transferring knowledge (CIPD, 2022). For younger generations, ParcelCare should focus on creating a dynamic work environment with opportunities for career development and supportive work culture, which is very similar to the strategies employed by Google, which has successfully attracted younger talent through its innovative work practices and employee benefits (Google, 2021).
Technological Advancements
Technological advancement continues impacting logistics, leading to transformations at ParcelCare, where modern working tools like automation, artificial intelligence, and data analytics have become inevitable. All these improvements positively affect efficiency, reliability of work, and the clientele’s satisfaction levels. Using these technologies calls for acquiring qualified IT employees with the knowledge and technical ability to manage and support these complex technologies. For instance, AI can improve the efficiency of distribution and delivery by finding the best routes, and within a data analysis approach, it can explain operational performance and customer needs. Also, there is an enormous need to train and develop the current employees of ParcelCare constantly. This also entails supporting training and development programs to ensure current employees understand how to handle and manage new technologies effectively (Taylor, 2021). For instance, training in the use or the existence of automation tools that have been adopted can assist the employees to be acquainted with changes that may be imminent, hence improving work flow for the firm.
