The new normality

The new normality

Although there are HR Managers we are in permanent contact with that consider the current year as difficult as 2012, with little projects in the HR field (marked by the ongoing budget constraints), we believe 2013 to be a better one.

There are good signs in several industries, which suffered before, e.g.: Collection /debt restructuring (financial), M&A (financial), legal consultancy, retail - still on a good level in Romania (also stabilizing to downsize in Europe), agriculture, engineering of some domains & industrial consultancy, pharmaceutical generic companies etc. 

Also notable is the increased need of real talents, real committed people, real hard working and stable, really loyal and accountable. The need of quality and focus became a way of life in our country as well. This opens true business opportunities for strong companies and for fresh creative enthusiasm. There is a “NEW NORMALITY” as Tony Goodwin, Antal President, recently mentioned, and the survivors and the winners will be the ones who will sense this normality and make it a boom.  

Moreover, there are good signs for an even better 2014.

Retention? Not so much

Unfortunately, very few companies have solid retention programs for their employees.

There are more and more corporations that are looking for the cheap candidates available on the market. This approach proved to have harmful results for the organizations, because the costs are much higher when hiring the wrong person. Another aspect is that the companies that are entering in Romania are not coming with their homework well done, thus there are expecting lower salaries then there actually are. In these conditions, with the limited budgets planned they are not satisfied with the candidates level. For example, for a senior position they have a budget corresponding to a junior one. 

There are only several companies that have well-tailored strategies for talent acquisition and retention. The vast majority of the organizations are concentrating their attention on how to make profit on short terms and are not paying enough attention to attract and retain talents by different methods or incentives. On the contrary, even for sales persons who are motivated mostly by the performance bonuses, the tendency for many companies is to cut these bonuses or any other incentives.

Personnel leasing – a solution for flexibility  

Personnel leasing is considered a permissive Employment way, due to the fact that the hiring companies are taking benefit of using labor without being constrained by the labor contracts themselves directly (ie. duration, termination clauses etc). Companies require leasing whenever there is a project valid for a while, due to seasonality of their activity, or due to some segment of their activity which is growing for a planned period of time (like in tourism, constructions etc). This can also happen when a company needs to replace a person for a while (ie. maternity leave); or in case of a start up that means that the future of their investment is not clear within the first year of activity (so the risk is less, under such employment terms), or when multinational companies have a hiring freeze on a global level, but locally in Romania there is some activity which needs additional task force support etc.

Education – Number one concern

Education system is a number one concern, in my opinion. Not the learning level of the graduates is the main issue, but their attitude towards work, employment stability, their real talent and abilities for a certain job. This is a very poor sector right now in our country. Very few students or graduates have real opportunities to target a job that fits best her/his native skills, simply because they don’t know themselves well enough, they don’t know the market themselves, they don’t know how a good professional should look like etc. They THINK they know, but most of them actually don’t know. The current educational system is too busy pushing a lot of technical information in their brains and there is little to none concern on their attitude-vs.-job preparation, starting from their early stages.

The fiscal pressure is higher, the legal environment unstable so this is, of course, a number one concern, as well.  There is no real support to hire the young graduates, in fact. The procedure that may currently be used that could save the unemployment cost (for the fresh graduates hiring), is quite laborious, and takes time.

In business “time kills the deals”, so most companies tend to choose experienced candidates (ie. proven candidates, with at least 2-3 years experience) rather than fresh graduates. The fresh graduates have no experience, but can save some labor cost, considering the risk and the cost of coaching them. Employers could discover that they are not matching the roles and be forced to fire and look a replacement. Such costs in total are double than making a secure hire, right from the first time.

Building together motivation – a code to be implemented

Labor Code imposes that the employer is ensuring formation to all the new employees, but if they DON’T do it, there is no law that stipulates how this could be sanctioned.

Also, there is a reverse situation when the Employer is paying professional formation and training for an Employee and the respective Employee makes a promise not to leave that company for a certain period of time, in view to repay the effort that was made for him. However, there were instances when that Employee had to leave the company before this term and the case had to be solved in Court.

We think that a mutual, amiable agreement or a good, solid working relation between parties couldn’t ever be replaced by the best contract, nor a stronger legal procedure, and this must be the way to prevail between the people at work. In the real life of course this looks like a dream, in most of the cases. There will never be an ideal LABOR CODE to resolve all HUMAN related situations. It is up to us people, HR managers with the HR consultants to constructively work together to improve the working relations, the retention rates at work, the training issues and all being resumed in one word, which is to improve at work people’s MOTIVATION.

A fortunate compensation

The unemployment will be kept approximately at the same level of previous years, there won't be dramatic changes in this respect. We think that banking, automotive, construction will continue to decline and we could see layoffs and restructure of people and departments especially in these sectors. Fortunately, there will be other sectors that will balance the overall unemployment trends, in Romania.