Financials and buyers wanted: tight labor market remains problematic

Tight labor market continues to keep minds busy in 2023. Financials and buyers still indicate that the war for talent has a major impact on hhe daily work. In addition notice they notice the effects of the growing importance of dhourliness and of the shortage of products and raw materials. This is according to inquiries among more than 200 finance- and procurement professionals at corporate organizations by independent research bureau DirectResearch.

The labor market has been extremely tight for quite some time now. Even the negative economic outlook has hardly changed that. Here and there some media reports do appear about large companies (especially international tech giants) where jobs are disappearing (such as at ZalandoAmazon and at PostNL), but those seem to be the exceptions that prove the rule.

For now, this is not representative of the prevailing sentiment in the Dutch labor market. Indeed; unemployment fell slightly again in February, figures from Statistics Netherlands (CBS) show.. In February, 3.5 percent of the labor force was without paid work, compared to 3.6 percent the previous month.

Finance and Procurement vacancies hard to fill 

In the fourth quarter of 2022, there were 123 job openings for every 100 unemployed. And a large proportion, more than half, of these vacancies were hard to fill. This was made clear in UWV's Employer Survey. . A lack of response from applicants is the main reason for these hard-to-fill vacancies. To a lesser extent, this is because applicants do not have the right skills, professional knowledge or work experience.

A number of professions structurally face "hard-to-fill" vacancies. This applies, for example, to accountants, financial administrators, controllers, compliance officers, assistant buyers, buyers and heads of purchasing. In short, finance and procurement departments are in dire need of reinforcement. 

War for talent is biggest challenge 

Not surprisingly, a whopping 43% of financials and 36% of buyers surveyed expect the tight labor market to be the development that will have the most impact on their work in the coming years. The war for talent emerged as the number one greatest challenge for the more than 200 professionals surveyed by independent research firm DirectResearch.

In addition, one-third of procurement professionals expect scarcity of raw materials and/or products to continue to have a significant impact in the coming years. A quarter of procurement professionals foresee that they will notice the impact of the increasing importance of sustainability and circularity.

This plays to a lesser extent in Finance: of them, 15 percent indicated that sustainability and circularity will have an impact on their daily work. An equal number of professionals pointed to artificial intelligence and big data as the most important development.  

Workforce shortage solutions 

Employers are massively considering how to cope with the acute personnel shortage. Higher wages, more vacation days or longer paid parental leave; everything is being done to attract new employees. They are also investing heavily in training, personal development and vitality. Everything to be as attractive as possible as an employer for (new) talent. 

These solutions mainly focus on the supply of the workforce: how do I get more employees in my company? But you can also turn it around and focus on reducing the demand for employees. So: how do I ensure that I need fewer employees in my company? "We must be able to do the same work with fewer people," says a parliamentary letter on addressing labor market tightness.

As one of the main solutions, the cabinet cites automation. "The cabinet sees many employers taking steps in the areas of technological innovation, process innovation and administrative pressure. Especially in the longer term, with an aging population, strengthening productivity growth is an essential route to address tightness."  

Avoid unnecessary, manual work 

If your company has too few employees for the work that needs to be done, investigate doing less work. By optimizing and automating processes, you can avoid unnecessary manual operations. The potential time savings are enormous.  

Intersnack experienced this first hand when they took a close look at their invoice processing together with ICreative. "In the old situation, an invoice had to be processed from A to Z: scanning, coding, checking, overwriting, matching, booking and forwarding. That took at least six minutes per invoice," Intersnack's then accounts payable manager Thomas Wijnberg told me. At that time, the seven Accounts Payable employees could process a total of about 100 invoices per day.

After optimizing and automating the entire invoice processing process, only three employees were needed to process more than one hundred and fifty invoices daily. "We can handle more and more with fewer and fewer people," Thomas said.  

By the way, don't think that his colleagues suddenly found themselves sitting at home on the couch. In fact, they were able to focus on other things, such as analyses of lead times and accounts receivable management. Thomas: "There remains plenty to do." 

Full trend report available for free 

Want to learn more about how corporates have structured their purchase to pay process and the implications for Procurement and Finance? Download the full trend report for free.

In it you will read about, among other things:  

• To what extent do corporates pay their invoices on time? 
• How do purchase orders and invoices come about among Dutch corporates?  
• What trends and developments affect Procurement and Accounts Payable? 

Anoek
van der Riet

Contents Specialist

Anoek writes daily about purchase to pay, order to cash and Robotic Process Automation. She enjoys diving into topics such as e-invoicing, working capital and hyperautomation.