Competitiveness challenges remain for Irish business
Ibec, the group that represents Irish business, has said that revitalising the labour market and building for a new world of work will play an important role in preparing the economy for emerging competitiveness challenges. It comes as the group hosts its annual HR Leadership Summit, taking place virtually today.
Ibec Director of Employer Relations Maeve McElwee said: “Relative to our international peers, as an economy Ireland currently stands to experience significant competitiveness challenges from Brexit, from international tax reforms and our existing laggard status in completing the low carbon transition.
“Enacting policies that protect our competitiveness will be the key to weathering an exceptionally volatile external environment and reaping the long-term opportunities economic re-opening can bring. This can only be done by controlling costs where we can and prioritising strategic investments in innovation, digitalisation and skills.
“For example, revitalising our labour market and building for a new world of work, giving companies the support necessary to meet ambitious low-carbon targets and making targeted interventions in housing can help us drive a new economic model which builds back better.”
At the event, Ibec also revealed the findings of its latest HR Update Survey (see attached), which highlighted two overall trends as apparent throughout the research findings. Firstly, skills shortages combined with upward wage pressure are leading to an increasingly competitive talent market. For those employers planning to increase headcount, a variety of initiatives are planned, with hybrid working increasingly seen as key to securing talent.
While hybrid working is a second dominant trend in the research, it is also clear that employers continue to recognise the importance of other employee supports and benefits, including employee wellbeing, providing the right technology, training and appropriate physical work environments.
Other key findings from the report include:
- Pay trends: In 2021, 65% of companies increased basic pay, with an average increase of 2.8%. These figures are higher than what was projected in our 2020 report, which is indicative of the ongoing economic recovery. The proportion of employers awarding pay increases will be 75% in 2022 with a reported average increase of 2.71%.
- New ways of working: The majority of respondents (62%) will implement hybrid working in their organisation. Hybrid working is recognised as a competitive advantage for organisations, along with other flexible working practices.
- Employee Engagement: Employee engagement ranks third highest in priority for employers. The data points to employers focusing on and investing in key areas related to employee experience. The key areas of HR investment planned for the next 5 years include investment in employee wellbeing (58% of respondents), investment in the physical workspace (39% of respondents) and equipping managers to manage dispersed teams (33% of respondents).
- Leadership and Social Influence: The key role of leadership is highlighted in our research again this year. Business leaders play a pivotal role in the support, development and engagement of staff, and leadership is the top area of skills investment (42%) planned by organisations. Leadership continues to evolve in line with our changed workplaces, with social influence recognised as a key leadership competence.
This year’s HR Leadership Summit was delivered with thanks to strategic partners Accenture, Microsoft Ireland and Irish Life Health, and associate sponsors DeCare Dental.