What does the future hold for the business services sector in Poland?
After a tumultuous few years that have transformed the world of work, companies face some new challenges in building effective teams for their centers. At the same time, there are new opportunities to evolve their talent strategies, adapt to the current landscape and be better prepared for the future.
Despite the recent disruption, business services companies are primed for strong and continued growth, as evidenced by Poland’s relatively low unemployment of 5.3% and strong economy over the past couple of years. But there are signs the economy may be slowing, such as a decrease in Gross Domestic Product (GDP) from 6.8% in 2021 to 4.9% in 2022, with projections falling to 0.7% in 2023.
But this potential slowdown hasn’t affected the sector yet, as many business services companies still continue to predict rapid employment growth. This has employers optimistic about the future, with nearly three-quarters (73.9%) planning to increase employment.
a changing landscape
Along with the growth, however, comes new changes as the sector evolves. As the sophistication of services provided by business services centers grows, employers must also recruit and retain talent with more sophisticated skill sets to deliver those services. This means talent leaders are facing greater competition for the skills they need to drive company priorities.
The growing presence of remote work arrangements also continues to present challenges for employers in this sector. While the shift to remote work was driven by COVID-19, it’s now become an attractive benefit for talent, enabling improved work-life balance and flexibility. However, some employers continue to be concerned about productivity and whether teams can meet their goals and fulfill company needs and projects.
3 areas affecting talent strategy
Among a backdrop of rapid growth and changing work dynamics, business services employers face a number of challenges when acquiring the talent their organizations need.
1. a limited talent pool impacts sector growth
As the need for business services increases and employers plan to expand their hiring, they will likely be challenged by Poland’s limited and shrinking talent pool. According to the IMD World Competitiveness Center, Poland was ranked 50th of 63 countries in its 2022 World Talent Ranking — a measure of how different markets develop, attract and retain talent. This is down from 45th in 2021 and 35th in 2020, emphasizing the challenges of Poland’s long-term ability to provide high-quality talent for the business services sector.
The talent shortages are also evident in the ABSL 2023 report, which finds that 40% of surveyed employers see availability of talent in Poland as a fundamental challenge to their center’s growth and opportunity. Meanwhile, the majority (55.7%) expect talent shortages will be significant in the next five years, driving the need to adapt how they find and develop talent.
2. high turnover and lower productivity
While talent scarcity makes it difficult to find talent, another challenge is retaining people with the right skills. Per the ABSL 2023 report, the voluntary turnover rate for the business services sector has risen from 13% in 2020 to 18.3% in 2022. As a result, more companies are providing enhanced benefits and focusing on well-being to better attract, retain and engage talent, such as offering remote work as an incentive.
ABSL data shows that 28.5% of business services companies in Poland require employees to be in close proximity to the office. Meanwhile, 45.1% of employers say they recruit from anywhere in Poland, and another 13% recruit from anywhere in the world. While hybrid and fully remote work can unlock access to talent outside the immediate location, some employers are still concerned about the impact to productivity.
3. IT/digital skills in increasing demand
Specialized talent, such as those with IT and digital skills, are increasingly in short supply and more costly to obtain. Not only are companies competing against others in the sector, but also with business across all sectors. According to the ABSL 2023 report, 56.1% of employers say predictive and advanced analytics are the most in-demand skills in the next five years, meaning such individuals may be even more difficult to find.
The scarcity of individuals with needed technological skills is also highlighted in Randstad Enterprise’s 2022 Global In–demand Skills report. By analyzing the supply and demand for talent with the most sought-after skills across 26 countries, the report found that Poland has among the highest job vacancy rates for roles requiring skills like artificial intelligence and machine learning, cloud computing, big data, and business intelligence and data visualization.
Further complicating the issue is that the costs of IT talent are going up, as is wage inflation. At 12.9%, Poland sees one of the highest wage inflation rates among developed countries, per Randstad Intelligence team market research. The short-term impact is that individuals with IT and digital skills will continue to be scarce, though over the long-term, AI may replace some of the simple competencies and workloads and thereby alleviate some of the effects of talent scarcity.
3 talent trends for business services sector
To overcome these challenges and ensure a more sustainable and agile approach, business services companies in Poland can follow three major talent management trends. These trends are based on the findings of Randstad Enterprise’s 2023 Talent Trends research, with responses from more than 900 human capital and C-suite leaders across 18 markets around the globe. The report also includes responses from more than 50 leaders in Poland, giving a first-hand view of how they are responding to changes in the talent landscape.
trend 1: create clarity and drive readiness with talent intelligence
Key to overcoming talent challenges in the business services sector is using the right talent intelligence to make better informed decisions and drive more accurate workforce planning. With access to internal data about their own talent and external market data, companies can gain a deep understanding of their current and future talent needs — as well as the supply of skills inside and outside of the organization needed to fill those gaps. Analytics also provide insights into how to be competitive through compensation and benefits, by understanding market rates and how to predict which roles will be quick or slow to fill based on available candidates.
Given economic uncertainty in Poland, and ongoing skills shortages, it’s more important than ever for companies to leverage talent intelligence. Strategies like workforce rebalancing, internal mobility and reskilling can all help companies overcome skills gaps, but without the right analytics, it will be hard to know the skills already existing in the organization, or identify individuals with adjacent skills who can be trained easily to take on new roles.
Based on the findings from the 2023 Talent Trends research, employers in Poland have made progress in utilizing analytics to enhance talent strategies compared to the previous year. For instance, 60% say they are investing in talent intelligence platforms, compared to 54% in 2022; 62% say they are investing in market insights platforms (40% in 2022); and 58% are investing in HR and talent analytics visualization dashboards (46% in 2022). The vast majority (81%) say decisions related to talent strategy are fully supported by analytics.
To fully capitalize on promise of analytics, consider these four strategies:
- Use analytics to understand how internal talent can be redeployed. You can analyze the adjacency of skills to higher-priority roles or use market data to understand the sources and locations of right-fit external candidates.
- Elevate diversity, equity and inclusion (DEI) beyond common factors, like the number of female employees hired. Instead use analytics to find areas where DEI can be measured and improved across the entire talent life cycle, like identifying career development opportunities, retention rates and availability of diverse talent.
- Develop clear KPIs that reflect the company’s business and talent goals, and then focus on the metrics that contribute to these goals, such as how many employees receive training to develop their skills.
- Although talent with analytics skills are in high demand, layoffs in the tech industry present an opportunity for business services companies to attract analytics professionals who were let go from tech companies.
trend 2: overcome talent scarcity with a purposeful talent experience
With companies in Poland competing for a limited talent pool, those that offer a meaningful work experience will be better positioned to find and retain top talent. Data from Randstad’s Workmonitor survey of 35,000 workers around the world shows that 77% feel a company’s values and purpose are important when selecting an employer. As competition for top talent increases for business services companies, those that can set themselves apart by highlighting the positive work experience and a focus on people will have a significant advantage.
How are companies in Poland working towards delivering a more meaningful experience? According to the Talent Trends research, 75% of talent leaders say the talent experience has become more important to their organizations over the past 12 months, down from 78% in 2022. There were also slight decreases in the number investing in DEI as a critical component of the talent experience (67% compared to 70% in 2022) and the number leveraging more technology to raise engagement (75% compared to 82% in 2022).
However, 77% say they’re creating specific talent communities and content plans to engage and nurture future talent, up 25 points from 52% in 2022. Given the growing demand for talent, such actions will continue to be instrumental in winning over talent early in the process. By working to enhance the talent experience, business services companies can create a desirable organization that fosters loyalty, improves retention and elevates the employer brand to remain a company of choice for talent.
- Develop a robust people experience that includes collecting feedback and inviting regular collaboration with talent to ensure they feel valued and heard.
- Strive to stay current with labor market trends, such as the available skills, compensation rates and locations of talent, and ensure salaries and benefits are competitive for each location.
- Recognize what’s most important to talent, which isn’t always more money; the Randstad Workmonitor study shows that 94% of workers say a good work-life balance is just as important as decent wages.
- Consider how expanding remote work and hybrid arrangements can be used as a tool to attract and retain talent outside the immediate area; and survey talent to understand what flexibility means to them to ensure they’re offering benefits and arrangements that make an impact.
trend 3: unlock workforce potential with internal mobility
Faced with growing talent scarcity, employers can look internally to fill crucial gaps. Internal mobility helps companies promote current talent to new roles by providing the skills and training they need to grow, while also serving as a powerful retention tool.
According to a study by McKinsey, 80% of talent want growth and new opportunities, which are critical to improving retention and enriching the talent pool. And given the time and costs it can take to recruit external talent, internal mobility is an efficient way to fill key gaps.
The Talent Trends research shows that many employers are already making progress in their talent mobility programs. Overall, 87% of respondents in Poland say they’re placing more emphasis on skilling and career engagement, a huge jump from 2022 when only 50% said they’re focused on this. Additionally, 88% say career mobility and redeployment of talent will play an important role in their talent strategies this year, while 62% say they’re investing in talent mobility platforms.
To build a successful talent mobility strategy that truly develops talent and retains employees, consider the following strategies:
- Create a comprehensive skills taxonomy to map out the knowledge base of the workforce and better understand how talent can be redeployed to adjacent roles based on their skills and future potential.
- Invest in an internal job marketplace that highlights internal openings, allowing employees to explore new opportunities to advance professionally without having to look externally.
- Implement a learning platform system that includes skilling curriculum and coaching that enables you to capture life cycle data for employees, while offering talent real-time insights to help them move forward in their careers.
adjust your approach to optimize your talent strategy
For business services companies in Poland, the current landscape is one of constant change and uncertainty. But there’s also plenty of opportunity to rethink the talent strategy and gain a competitive advantage. Investing in talent analytics will help uncover where to find relevant candidates who are in higher demand than ever. Creating a purposeful work experience can attract and retain high-quality talent eager to help the company succeed. Meanwhile, developing a robust internal mobility program will empower current staff and give them the tools to take on advanced positions, while further supporting retention.
All of these factors will play a key role in building a strong business services operation able to meet current business needs, while gaining the agility to address any future challenges.
Learn more about these top talent trends, and what other companies are doing to enhance their talent strategies, in the 2023 Talent Trends Report.
*This content originally appears in the Association of Business Services Leaders (ABSL) Business Services Sector in Poland 2023 report, and is published here with permission from ABSL.