In addition, our research has consistently identified attracting and retaining talent as the leading internal business issue globally. The factors driving a need for executive hiring include:

• The need for new skills and capabilities and even new leadership roles
• Leaders that can adapt to changing business models
• Leaders with expertise in expanding into new lines of business
• Leaders to replace an aging leadership team
• Recognition of diversity and inclusion

The challenge is not just a typical labor shortage, but a shortage of top leadership talent with specialized skills and competencies, such as adaptability, agility, resilience and an overarching, demonstrated ability to lead change. There is also demand for new and emerging roles, such as those focused on sustainability, climate risk, cyber risk, and competencies such as a track record of digital transformation success, the ability to identify new business opportunities through artificial intelligence while managing risks, leadership in diversity, equity and inclusion, a focus on innovation and more.

The shortage of executive talent is amplified by similar business needs across many organisations worldwide; add the demand for new roles where 20 years or more of relevant experience is just not feasible and we find ourselves in a “candidate’s market.”  Like in real estate, when we have a “buyer’s market,” the candidates have greater leverage. Top talent often have many opportunities and they are very selective. They look for more than the best compensation offer.

WHAT DOES THE CANDIDATE’S MARKET REALLY MEAN FOR ORGANISATIONS?

In a candidate’s market, the candidates, especially those with highly sought-after skills and competencies, have the power. They know they are in demand, and they have choices. Here’s what that means for organisations:

COMPETITION:

The talent shortage and candidate’s market heighten the competition for top talent. Executive candidates with specific, hard-to-find competencies and skill sets are in high demand and may receive offers from several companies looking to fill vacant positions. This means that your organisation will need to position itself as the most attractive option by providing a competitive offer and a strong employee value proposition.

TALENT EXPECTATIONS: 

In many cases, candidates expect and ask for more than they normally would in terms of compensation, benefits, and flexibility. The post-pandemic environment has changed expectations around mobility and flexibility. In today’s world, many employers seek leaders interested in returning to the office while leading candidates may prefer hybrid or remote options. Candidates also expect professional development and opportunities for advancement. To attain the leadership talent you’re looking for, you may need to compromise with the desired candidate, or find creative ways to fulfill their expectations.

CULTURE COUNTS: 

Recent AESC research shows that candidates are paying attention to a prospective employer’s leadership, culture, and purpose. Candidates want to join organisations that are aligned with their own values and purpose. After all, they are leaders and want to be a part of a leadership team with shared interests.

SKILLS & EXPERIENCE GAP: 

Between new competencies, new roles, and a growing shortage of diverse talent, your organisation may need to get creative in finding alternative solutions to fill positions. This may include thinking outside the box when looking at potential candidates, prioritising transferrable skills or providing additional training and support to the successful candidate.

CANDIDATE HESITANCY: 

The talent shortage and candidate’s market are also amplified by global economic uncertainty. Candidates may be reticent to make a move, meaning it may take additional persuading or a longer-term courtship to make them consider your opportunity. In some cases, candidates are taking extra time to consider an offer, slowing down the hiring process and leaving positions vacant for longer periods of time.

EXTENDED TIME TO FILL POSITIONS:

In addition to candidate hesitancy causing delays, the lack of qualified executive candidates will also prolong the time to fill. The executive search process is already a rigorous process with multiple steps. Adding in the shortage and lack of viable candidates in turn makes the process take even more time. During times of shortage, it may take longer to identify, engage, and secure the right candidate, which can cause delays in decision-making and hinder long-term objectives.

SUCCESSION PLANNING IMPACT: 

A shortage of top executive talent creates an important opportunity to strengthen the focus on succession planning, assess a diverse pool of next leaders, and create innovative development opportunities to accelerate growth. All of this strengthens your organisation and complements your focus on external recruiting of top talent.

DECISION-MAKING LIMITATIONS:

Without the right leaders in place, your organisation may face challenges in meeting your goals, driving innovation, implementing new strategies, and navigating the complex business landscape.