Global hiring as a source of competitive advantage
The global talent pool offers substantial opportunities for Kiwi employers, but the practical hurdles often make it too hard to hire internationally. Shannon Karaka explains how using an EOR removes the stress. We know New Zealand is suffering an unprecedented workforce crisis. A study by Hays NZ found that 91 percent of employers of professionals […]
The global talent pool offers substantial opportunities for Kiwi employers, but the practical hurdles often make it too hard to hire internationally. Shannon Karaka explains how using an EOR removes the stress.
We know New Zealand is suffering an unprecedented workforce crisis. A study by Hays NZ found that 91 percent of employers of professionals are experiencing a skills shortage. To put that in context, most of those employers say it will impact the effective operation or growth plans of their organisation.
One obvious solution is to look beyond our borders for the right people. Traditionally, there have been significant roadblocks to hiring international talent such as lengthy entity set-up times, compliance risks, confusing local laws, visa processing delays, complicated tax systems and hefty fines if you don’t get it right. These obstacles have had businesses hiring from locations that are easiest to comply with, rather than where the skills lie.
In the past few years though, the rise of extended remote working has driven a new global hiring movement. Arise, the ‘employer of record’. The EOR.
Demystifying the EOR
An EOR acts as a legal employer of workers from other countries. It carries the legal responsibility for overseas workers – managing their contracts, onboarding, salary, employee benefits, taxes, background checks and termination – and it ensures compliance with local laws. At the same time, you remain in charge of your employees’ day-to-day tasks and workload.
Where are all the candidates?
Deel’s latest data shows that New Zealand has a desperate shortage of people in the tech sector, with the most sought-after roles being software developers, digital designers, software engineers and sales team members. With too few Kiwis to fill these roles, employers are looking further afield, most commonly to the United States, the UK, the Philippines and Australia.
Searching for new hires across the globe ensures you find the best talent, but there are challenges that come with diving into the international market. Compliance with local labour laws is a big one, as is the administration of benefits and perks, and anyone who’s had to deal with payroll for overseas employees will know what a nightmare it can be. An EOR enables payment of employees and contractors in their preferred currency, which could even include cryptocurrency.
Recruiting overseas talent
Preparation is everything when it comes to attracting and hiring the best international candidates. Before taking the plunge, employers should be ready to:
- Impress candidates with a strong employer brand and remote company culture.
- Implement training and systems to reduce bias during the hiring process.
- Calculate locally competitive salaries.
- Offer benefits that attract remote talent.
Hiring is the easy part
Building an international team can be challenging and time-consuming. Effort needs to be focused on onboarding and developing teams, and this is where the benefits of an experienced EOR really kick in. A wide range of services and compliance controls are all taken care of by the EOR in one simple platform. However, businesses maintain full control of the day-to-day relationship with the employee and importantly all IP ownership.
There’s no doubt that remote working is attractive to employees. In Buffer and AngelList’s State of Remote Work 2020 report, 98 percent of people said they would choose to work remotely for the rest of their life. They cited better work-life balance, reduced expenses and fewer distractions. However, the downsides of remote working include social isolation, burnout from blurred work-life boundaries, and communication breakdown between teams.
Employers who can confidently provide a fantastic remote working experience are more likely to meet the ongoing needs of employees. Technology helps, and employers can encourage real-time communication with cloud-based tools and organise team-building activities to keep remote workers connected to each other and the business. At virtual happy hours, people can drink, eat snacks, talk and play games together, enabling teams to wind down after work and get to know each other better.
Businesses are also enjoying the benefits of distributed work, with some of the most significant being access to a wider talent pool, retention of talent, reduced expenses and increased profits. For our high growth tech firms and exporters entering new territories, global hiring enables local people to be employed and market conditions tested before committing to establishing a new entity.
Not so long ago global hiring was inconceivable for many businesses. Today, however, location shouldn’t stand in the way of businesses hiring the right talent or people landing their dream job. The ability to ‘take work to where the people are’, is becoming a competitive advantage.
Shannon Karaka (pictured above) is Country Leader AUNZ for Deel.