You’ve probably noticed in the recent spate of large-scale tech downsizings that there’s been a migration of highly sought-after IT professionals from one firm to another. But in light of ongoing recessionary fears and inflationary pressures, it’s probably worth pushing that point a little bit further. For example:
- Might something similar be in the cards for the finance and accounting workforce?
- If so, how would that impact enterprise talent strategies?
- And what’s the perm versus contingent takeaway for C-suite decision makers?
The following three insights will help you structure the conversation.
talent scarcity is here to stay - in fact, a recent study shows that by 2030 we will have expanded into a 'global talent shortage'. So it's critical that companies and leaders recognize this reality and the long-term impact to their businesses if they don't implement different hiring strategies and behaviors in the interim.
1. the fractious future: FP&A and HR teams in 2023
Let’s get this out of the way: Layoffs, restructuring, reshuffling and the like may be coming for many in the financial planning and analysis (FP&A) space. Ditto HR teams.
Why?
Let’s begin by looking at headcount reductions such as:
Sure, that’s exclusively tech — and January is traditionally the busiest time of year for this type of organizational regroup.
But even so, what we’re seeing right now ought to register as something else entirely. After all, people employed in professional and business services are historically among the least secure in economic downturns, and the same research shows that the finance space is consistently among the hardest hit in terms of net layoffs.
Also, from a forecasting perspective, perhaps the most persuasive evidence is already in: Namely, more than a quarter of the layoffs reported so far this year have affected people in two departments, FP&A and HR.
Yikes!
If that’s a remotely accurate forecast of what’s trending in 2023, it suggests that unprecedented challenges may be on the horizon for talent-strapped FP&A teams as well as their radically lean HR partners. Of course, only time will tell.
2. representing reversals: challenges in the DEI landscape
If this large-scale workforce reconstruction indeed comes to pass, it’s going to change the composition of the workforce. Obviously. That’s unavoidable. But how you go about it will (literally) change what your workforce looks like, so it’s worth asking: What’s the best approach?
Revisiting what we’ve seen in the tech sector holds important clues for FP&A decision makers in this respect, especially in the context of diversity, equity and inclusion. For example, workforce restructurings within the tech space appear to be skewing in the direction of bias, and a lot of preliminary research suggests that recent rounds of layoffs at tech firms have disproportionately impacted two groups specifically, women and people of color.
In fact, there’s a lot of data to back all of this up:
Women, who in general represent only about one in three tech workers, have nonetheless accounted for nearly half (47%) of recent workforce casualties.
Meanwhile, Latino employees, who comprise a meager 11 percent of the overall IT workforce, now account for more than one in 10 of the recently terminated.
Twitter is paradigmatic in this regard, with women accounting for more than half of recent layoffs at a company where men constituted a sizable majority. (Spoiler alert: There are lawsuits pending.) For organizations now restructuring their FP&A workforces, or even simply rethinking how they’ll leverage contingent and full-time workers, however, the good news is that it’s probably not too late. Just think about what metrics matter, what outcomes you want to drive and what guardrails you’ll need to get there.
That’s the only way to avoid the kind of DEI pitfalls we’ve seen so far in tech. And at a moment when one in three companies plans to cut 30 percent of their workforces or more by year-end, it’s probably high time to take action, too.
The challenge for corporate HR teams is not just with fulfilling hiring deadlines, it is satisfying the needs of the talent that they are seeking, The talent shortage and a growing desire from job seekers for a stronger company culture and values has resulted in HR teams not being able to fill their pipelines with qualified talent, resulting in longer hiring timelines and frustrated hiring managers which leads to missed deadlines and in turn impacts financial performance. This is especially true within the finance and accounting space, where there is little room for error. Tatum prides itself on being a consultative partner to our clients, providing strategic insight to navigate hiring challenges as well as having highly qualified talent resources at the ready, to reduce delays.
3. what’s next?
There’s a reason the majority of CFOs in a recent Gartner survey think hiring and retaining FP&A talent will be their biggest organizational hurdles over the next 12 months. Further, more than one in three of those CFOs indicated that forecasting could be a major challenge, and more than one in five said the same of “planning staffing levels across the company.”
All of which is going to have to be top of mind at your company. Of course, it’s going to be top of mind for your competitors, too.
So if you’re ready to find out how strategic partners like Tatum by Randstad can help you level-up, adjust to new employee expectations, fill critical FP&A roles faster and deliver on pressing business priorities, reach out to our team right now.