The impact of an employee-driven market on contact centres


The war for talent is an issue for many leaders across a number of verticals, but with the contact centre sector being so reliant on labour, these organisations are grappling with this key business challenge. While attrition, or churn, is often a challenge for leaders in the sector, organisations are currently facing a challenging economic climate and it doesn’t look to be improving any time soon. In this article, we will explore why organisations are facing an employee-driven market and what can potentially be done to mitigate the associated challenges.


What is an employee-driven market?

An employee-driven market simply means that employees in the sector have gained more leverage and influence in shaping their work environment, conditions, and overall job satisfaction, rather than being led by sector demand. One of the reasons for this, is due to the shortage of talent, especially in the UK, because of Brexit and the associated reduced labour market. Across the sector, there is a growing demand for skilled professionals, particularly in specialised areas such as technology, data analytics, automation, and artificial intelligence. As the demand outpaces the available talent pool, employees gain more bargaining power and can negotiate better compensation packages, flexible work arrangements, and improved benefits. This impacts organisations in a series of ways, including needing to find alternative ways to source talent, and can cause issues if there are significant gaps in particular skillsets or knowledge.

The need for new skills and capabilities

With significant digital transformation taking place, the need to attain the required skills and knowledge to remain competitive and enable growth has increased. As the pace of technology advancements has been significant, organisations are putting a greater focus on automation, cybersecurity and compliance. The search for skills to support this evolution poses quite a challenge for organisations, including finding the right level of knowledge and understanding of statistics, artificial intelligence, analytics and machine learning. Faced with significant skills shortages and a competitive landscape, as mentioned in Reed’s 2023 Salary Guide, companies may need to turn to industry professionals to support them to understand what is important for employees and what is happening in the wider recruitment landscape. Taking a closer look at the benefits that are offered and ensuring they reflect what individuals are looking for, will be imperative to organisations.

The war for talent

Another contributing factor is the competitive job market in attracting and retaining top talent. With a limited pool of skilled professionals, employees have more options available to them and can choose companies that offer the most favourable working conditions, career growth opportunities, and work-life balance. With increasing pressures on individuals due to the challenging macro-environment, organisations are having to turn to financial incentives to retain their employees. While organisations themselves are facing difficult times with rising redundancies, hard-to-fill vacancies and an increase in the National Living Wage, they have no choice but to attempt to retain the employees they have. This has resulted in the increase of counteroffers. In the CIPD’s Labour Market Outlook report, a striking forty percent of employers have reported to have offered counteroffers within the last 12 months, with half of them carrying out more counteroffers than before. Therefore leaving organisations facing difficult decisions around which approach to take.

Greater flexibility for employees 

It Is also significantly easier for individuals to move across sectors, providing them with greater flexibility and choice. Individuals are no longer looking to remain in the same job or organisation for their whole career, and while this cross-skilling can be beneficial to organisations, it can also cause significant challenges if there are too many vacancies. To adapt to this competitive landscape, organisations will need to differentiate themselves and provide attractive employee value propositions, including flexible and remote working practices.

The impact of demographic changes

Over the last century, there have been significant demographic changes which has greatly impacted the way organisations engage their workforce. With five generations of people currently working alongside each other, organisations must cater to a range of multigenerational needs and expectations. For example, younger generations entering the workforce, such as millennials and Gen Z, often prioritise factors like work-life balance, personal development, and purpose-driven work. Organisations also face potential skills and knowledge gaps as older generations start to retire. It’s therefore necessary to recognise the importance of providing a positive employee experience for all, to help drive engagement, productivity, and retention. Organisations should look to invest in initiatives such as flexible work arrangements, wellness programmes, career development opportunities, and inclusive workplace cultures.

The role of digital transformation

Digital transformation has empowered employees to make more informed decisions on where they want to work. The availability of information through digital platforms and social media enables employees to gain greater insights into industry trends, company reputations, and the experiences of other employees. This increased transparency allows employees to be more selective about the organisations they work for and ensure that working conditions and benefits meet their needs prior to being hired. Maintaining a positive strong brand is crucial to remain relevant and appealing for individuals, as this enhances the company’s reputation and makes it more attractive to potential employees. As employees have more choices, they can seek out companies known for being employee-centric and supportive.

How to attract individuals in an employee-driven market

In response to the rise of the employee-driven market, contact centre organisations need to prioritise employee engagement, invest in talent development, and create a positive work culture. This includes offering competitive compensation and benefits, fostering career growth opportunities, providing work-life balance, and implementing policies that prioritise employee wellbeing. In Reed’s 2023 Salary Guide, they suggest an annual salary increase, a four-day working week, flexitime and performance bonuses to be the highest priorities for those looking for a new job. A holistic focus on both financial incentives and benefits, including flexibility and an inclusive brand, will be crucial to attract and retain staff. By placing employees at the centre of their strategies, organisations can attract and retain top talent, remain competitive, and drive business success.

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