Executives are slightly less optimistic about the business climate in 2020 and concerned about talent acquisition, according to the Employer Associations of America’s 2018 National Business Trends Survey.

The majority of respondents, 52%, expect the economy in the next 12 months will stay the same, with only 12% saying the economy would improve and 36% stating that the economy will decline. Numbers in these two areas have flipped from the last year’s survey, when 30% felt more confident that the economy would improve and only 12% felt there would be a decline.

The survey found 47% plan to hire permanent staff in 2020, down slightly from 54% in 2019’s survey. Respondents did indicate 65% were hiring in part due to newly created jobs. The majority, 83%, seem to be replacing employees due in part to voluntary turnover. The increase in voluntary turnover makes talent acquisition more difficult and employers will need to offer more competitive wages and be more strategic when marketing for positions, according to the association.

Executives surveyed indicated the following as top challenges to their business in 2020:

• Talent acquisition
• Talent retention
• Ability to pay competitive wage/salaries
• Competition in general
• Ability to pay for benefit costs

In moving forward with their hiring practices, organizations said the top five most important factors prospective employees are looking for in 2020 are fairly similar to last year’s results:     

1. Competitive pay: 81%
2. Good work/life balance: 69%
3. Opportunities for advancement: 56%
4. Flexibility in work hours: 56%
5. Competitive health benefits: 48%

A lack of qualified candidates was cited as the top reason why it has become more difficult to hire employees in their industries, cited by 66%, followed by “market competition/high demand” at 48% and “candidates want more pay than we can/will offer” at 43%.

“Given the feelings about the economy in the next 12 months, it seems that organizations are taking a more cautious approach to 2020,” said EAA Board of Directors Chair Mary Corrado. “Despite reduced confidence in the economy, 49% of organizations surveyed still expect a slight increase in revenue for the coming year. The talent shortage will remain a key factor in 2020. Employers will need to implement innovative talent acquisition and retention strategies to meet their business results.”

The 2019 survey included 1,093 participating organizations throughout the US.