According to a recent survey by Grant Thornton LLP, chief financial officers (CFOs) are navigating a new and different kind of war for talent — one in which employees have higher expectations and greater leverage than before the pandemic. Whether they win or lose this “war” may depend on how creative CFOs get while attracting talent and managing investments.
The 2021 Q2 CFO Survey — which polled 239 CFOs and senior finance executives at companies with annual revenues ranging from $100 million to more than $1 billion — revealed a few common threads, each of which has major implications for the future of post-pandemic work. For example, nearly two-thirds (64%) of CFOs said they’re worried talent shortages could impair their ability to meet short-term strategies.
“There are clear indications that CFOs are concerned about the looming war for talent,” said Tim Glowa, principal and leader of Grant Thornton’s employee listening and human capital services offerings. “Yet there are also conflicting messages on taking steps to actually fix it. Many organizations are saying people are expected to be back in the office, but that’s inconsistent with the data on what employees actually want.”
STAYING COMPETITIVE IN A RAPIDLY EVOLVING LABOR MARKET
The survey results and recent news indicate a sea change in the labor market. Specifically, employees are reluctant to surrender the increased flexibility they gained during the COVID-19 pandemic, while widespread talent scarcities have given them increased leverage as they consider their employment options.
The data detailed in the Q2 survey showed that CFOs are aware of this scarcity: 68% agreed that organizations will see a possible shortage of human talent in the next 12 months, while 56% of finance leaders said attracting and retaining key talent will be their most important human capital priority for the next 12 months. Yet achieving retention goals may also be a challenge: A third (33%) of CFOs said people are expected to be back in the office.
“When you have a widening gulf between what employers expect and what employees want, evaluating the benefits you offer becomes even more important to your business,” noted Glowa. The data concur: 67% of CFOs surveyed agreed that employee benefits are a major expense the finance function needs to control. Predictably, the benefit that garnered the strongest reaction was healthcare coverage: 72% agreed healthcare costs need to be controlled.
As costs such as healthcare continue to rise, Glowa believes a CFO’s creativity may be more important than ever. “CFOs have always played a pivotal role in shaping their organizations’ futures,” he added, “and now they have an incredible opportunity to shape post-pandemic work. By finding ways to enhance benefits and more effectively spend money allocated to benefits programs — and it’s certainly possible to do both — you can attract and retain the kind of top talent your company needs.”
TIME TO GET CREATIVE
For CFOs, creativity is often directly linked to investments. According to the survey, finance leaders are focusing on three key investment areas: real estate, technology and cybersecurity.
Expecting a rise in fraud activity, more than half (54%) of CFOs said their cyber risk and security costs will increase during the next year. Furthermore, survey data indicate many CFOs are emerging from the pandemic with a desire to enhance their technological capabilities. Forty-seven percent of the finance leaders said they plan to invest in technology that solves urgent business issues, while 53% said they plan to invest in technology infrastructure that will help equip, enhance and protect their company in the future. And while nearly one-fourth (24%) of the CFOs surveyed expect real estate costs to drop, 32% expect that cost to rise.
SUPPORT FOR AMERICAN JOBS PLAN
Finally, when asked about the Biden administration’s American Jobs Plan, senior finance leaders thought the legislation is good for jobs and the economy. Fifty-one percent said the legislation would have a positive impact on workforce hiring, while 45% believed it would have a positive impact on corporate taxation. And just over half (51%) of CFOs said the American Jobs Plan would have a positive impact on corporate growth.
“In many ways, our new business environment will be more expensive than it was before the pandemic,” concluded Glowa. “We’re heading into uncharted territory, and how CFOs and other executives respond to this war for talent and a new administration in Washington will be key for every company’s success.”
To see additional findings from Grant Thornton’s Q2 CFO survey, visit grantthornton.com.
