Rebuilding reward and career frameworks based on skills
Reskilling employees is the #1 workforce initiative for executives, and HR ranks and re-designing talent processes around skills as their second highest priorities, according to our latest research. Leading organizations are already looking at ways to weave skills into their established performance-based approaches. Do you measure up?
Mercer’s annual Skills Snapshot Survey collects benchmarking data from multinationals worldwide to uncover key trends, challenges and opportunities around skills-based talent practices, gauging market progress year by year. The research report will provide you with actionable insights and data to benchmark your approaches against peers and optimize your efforts.
Highlights of last year’s Pay for Skills survey findings
What’s driving skills-based talent strategies?
With more companies than ever before prioritizing skills over education, all organizations need to think about developing their skills-based talent management capabilities.
Competition for top talent is fierce. About 45% of companies report a pressing need for skills that are generally in high demand, which makes the search for talent (and talent retention) especially challenging.
Overall, the need for certain skills has moved to the forefront of the hiring process — in some cases ahead of education and experience. As a result, skills-based pay practices are often deployed to attract new talent. However, even though organizations are assessing skills when hiring (with a view to achieving their strategic goals), many companies still have no formal skills-based rewards in place to recognize and drive in-house skills development.
This poses the question: are companies over-focusing on skills during the hiring process, while under-focusing on building and retaining the skills they need to advance their business priorities?
Key strategic purposes for using skills-based pay
Strategic necessity to revamp an organization’s key technical skill sets
Implicit need linked to strategic goals
Entry into new markets
Development of new services/products that require a new/enlarged technical skill set
Aggressive strategic policy of hiring high-end professionals (e.g., AI and digital)
Explicit goal present in the strategic plan