Majority of CEOs not cutting staff

Tight labour market remains a concern

PwC's 26th CEO Survey makes clear that the tight labour market remains high on the agenda of CEOs in the Netherlands. Despite the deterioration in economic conditions, only a minority say they are looking to reduce their workforce. And lowering salaries isn't on the agenda at all… Indeed, CEOs are prepared to increase them in their battle to attract staff.

Tight labour market is structural

These choices are among the outcomes of the CEO Survey which asked CEOs what they are doing in response to current economic challenges and volatility. Almost all respondents said they had raised prices or intended to do so. Of equal interest is what the majority don’t intend to do, namely cut staffing levels, suspend hiring or reduce salaries.

Labour market expert Bastiaan Starink (PwC) is not surprised by this: “The deficit isn't because of the economic cycle, it’s structural. And the scarcity is such that it remains a major concern, despite a substantial cooling down of the economy.”

Raising salaries still seen as best way to attract staff

What also emerges from the CEO Survey is how CEOs still rely on salary increases as the best way to attract staff when faced with a shortage. Starink understands this fact: “It is precisely during an economic downturn that fixed, stable salaries become attractive to young people. This was also evident from PwC's Young Workers Preference Study last year.”

That said, Starink also points out that people continue to look mainly at the overall employee experience’ that companies offer such as training and development opportunities, challenging work and a pleasant working environment. “Employers need to be more creative about attracting staff. The survey shows that only eighteen per cent of CEOs are open to hiring people who are less qualified. They’re often still looking for the perfect candidate who no longer exists or isn't available rather than tapping into the wider labour force potential.”