Our sector has faced significant challenges since the start of the economic downturn in 2008. The banking crisis and global economic recession have brought about a big shift in workplace trends. A recent report by the Chartered Institute of Personnel and Development, Megatrends, considered the capacity of HR to recognise and respond to emerging trends, threats and opportunities. I have pulled out some of the points that are specific to our sector.
An ageing workforce with fewer young people in employment In 1992, 54 per cent of the workforce was aged 35 to 64 and 41 per cent aged 18 to 34. Now 62 per cent are aged 35 to 64 and 34 per cent aged 18 to 34. This suggests that we need to skill-up the existing workforce and be thinking seriously about how to replace highly skilled staff who are nearing retirement. A big question for managers is how to encourage young people to be interested in joining a sector with generally low wages and an insecure future.
The halving of union membership since the 1970s and the massive reduction in collective bargaining This makes it easier for employers to increase flexibility in the workforce; however, it also means an increased reliance on employers to be ethical and responsible. Remember, unions were the folks who brought you the weekend!
Greater diversity in employment relationships The number of full-time, open-ended contracts is falling. There is an increase in the number of zero-hours contracts, home-working, self-employment and part-time working. Probably most of this is involuntary because of the downturn and changes to the benefits system. We have always had a variety of contracts in the sector, but this needs careful HR management and we must be as responsible as possible in how we apply them; otherwise we also become part of the economy that is involved in the development of a "precariat", existing without security. Workers should not be living hand to mouth, one pay cheque away from loan sharks.
A sustained fall in real earnings during the downturn Public sector pay might have increased by 4 per cent, but inflation has also increased by 21 per cent, resulting in workers being 17 per cent worse off, which is why most of us don't feel wealthier even with an upswing in the economy. Pay is also held down in our sector for a variety of other reasons, so managers should consider their reward and engagement strategies to help compensate for the shortfall.
A crisis of trust There has been a loss of public confidence in institutions such as the NHS, politics and even the charity sector. Trust inside organisations – between staff and senior managers – is also falling.
Strategic challenges for HR in the third sector can often be summed up as "it's change all the way" – and never more so than now. Nothing can be relied upon to be stable, but it's vital to be strategic about the solutions.
We must plan to manage our human capital by investing in recruitment and development, and by looking at how we structure jobs and contracts. It is important to invest in a trusting culture – we must make sure that those who manage staff do so effectively, with praise and challenge at their heart. Help them to be assertive and HR will help itself.
Gill Taylor is a sector HR consultant