How to win the war for talent

This is an audio transcript of the Working It podcast episode: ‘How to win the war for talent’

Tyler Cowen
I like to just ask, how ambitious are you? That sounds a little trivial and maybe people are always gonna lie somewhat. But when you get a sense of the enthusiasm or lack thereof or the command of detail in their answer, I think you do get a sense of how ambitious the person is. It’s an oddly difficult question to lie to.

Isabel Berwick
Hello and welcome to Working It, with me, Isabel Berwick. We’ve been hearing about the “war for talent” for years now, with businesses competing to attract the people they consider to be the most skilled. But if hiring challenges can be described as a war, then the last two pandemic years have been one long battle. Covid-19 has resulted in a lot of journalists like me generating snappy titles for trends that we observe in the workplace. So we’ve had the “great resignation” and the “great reshuffle” and employees now “boomerang”, meaning they leave and come back later, or perhaps they “quiet quit”. But the thing at the centre of it all is talent, meaning the staff who you either want to cling on to or hire from competitors. So today we’re asking: what’s the best way to maximise your chances of recruiting and retaining the best people? For answers, we turned to Tyler Cowen. He’s an economist and co-author of a new book called Talent, and that’s been making a splash. It was longlisted for the FT’s own Business Book of the Year prize. So here’s Tyler talking about how managers can identify people with something special about them.

Tyler Cowen
So one result we come up with early in the book is simply that very smart individuals tend to over-emphasise the importance of smart for someone doing well at a job. So to do a certain job, you might need a particular level of intelligence. But above that level, smarts and achievement are barely correlated at all. And what seems to matter more are personality features such as determination, durability, interest in working well with others, understanding what it means for expectations to be set. And so smart people should look a bit less for smarts. That would be one simple lesson we offer in the book.

Isabel Berwick
I’m joined for the first time on Working It by my colleague Anjli Raval, who’s the FT’s new management editor. Welcome, Anjli!

Anjli Raval
Hello.

Isabel Berwick
What do you think about what Tyler said there about so-called smarts or greater intelligence being overrated? And when you’re talking to business leaders —  as I know you do a lot —  what did they cite as key characteristics that come up again and again as great attributes in a staff member?

Anjli Raval
I think it’s super interesting and we’re seeing it live really in the news stories because over the years you would hire people with a track record of operational excellence, you know, that have the CV that’s just absolutely phenomenal. And now it’s just not enough. We then went through a phase, particularly in the last three years, and it’s actually still relevant that you then had to be a great communicator, you had to have great people skills. You needed to have the so-called soft skills that people talk about, because that was the differentiating factor when it came to managing a particular scenario or a group of people. And I wrote a column about this recently where there seems to be kind of a third iteration, which is that there are just so many uncertainties out there in the world, whether it be of a geopolitical nature, you can see what’s happening in the global economy right now, but also particular pressures facing individual companies. You just have to be unbelievably flexible and really resilient to whatever may come and just this huge ability to handle whatever is thrown at you. So in some respects, I completely agree, because you could be the smartest person in the room, you could have all the academic qualifications, and your CV may look brilliant, but it doesn’t necessarily mean you are the right person for a particular job.

Isabel Berwick
So when we’re talking about what makes a great employee, something like adaptability might be top of the list.

Anjli Raval
I think when it comes to what we’re actually demanding as employees from our managers and our companies, we’re demanding that employers are more flexible. But in return, I think employees need to be more flexible, too. And obviously, I don’t mean that you should be doing all the jobs out there that you don’t want to do. But I think you have to have some degree of flexibility when it comes to things like deadlines or coming into the office, maybe on the day that you don’t want to. There’s so many different things that you could put in that bucket.

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Isabel Berwick
And that point about staff needing to be flexible, too, is perhaps half of the equation that we don’t hear very much about. So that’s interesting you’ve brought it up. It’s all about leaders offering hybrid work or being adaptable, but actually what is the onus on us as employees?

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Isabel Berwick
So in terms of hiring people, part of the problem for a lot of companies is that their hiring is a mess. Some have very structured and we could say too structured, multi-layered, very long hiring processes. And that can mean people get trapped for months in a system. And any decision to hire comes far too late. And too many organisations are not clear about the job or who the hiring manager is. And we see this again and again, and that’s even before you get to the format of the interview questions. So while I was on holiday recently, Tyler spoke to my FT colleague Taylor Nicole Rogers about how to improve interviews.

Tyler Cowen
It’s gonna depend a great deal on context. So for a lot of jobs, you’re just hiring a large number of people. You have a standardised process. It’s not easy to improve upon that process, which is, by its nature, bureaucratic. But a lot of other jobs, mainly it’s not about the structured interview. It’s about your unstructured interactions with them and how you should interpret those. So we suggest very strongly when you’re dealing with people, get them into the conversational mode, try to get out of interview mode, just get them talking about things they care about. Get a sense of how they process information, how they learn, what they’re interested in, what’s their command of detail, what’s their level of enthusiasm. And then judge the person’s talent by those metrics rather than just asking them a series of pre-planned, canned questions that at this point seem to bore just about everyone.

Taylor Nicole Rogers
Right. Exactly. You did say in the book that you have a favourite interview question. Can you tell us about it?

Tyler Cowen
Well, I have two favourite questions. It will depend on the kind of job. If it’s for someone who is leading an organisation or trying to build something, so if you are hiring, you know, the next chief editor for the Financial Times and you ask them “How ambitious are you with the newspaper?” that’s a hard question to just bluff an answer to. You get a sense of how well they thought through potential different futures for the Financial Times. But if it’s less of a leadership job, I like to ask the question “What are your open browser tabs right now?” It’s getting at the question of what the person really cares about, what they read in their spare time. Just how they answer the question, you get a sense of their passion for ideas or lack thereof. You get a sense of what kind of mind there are. So some people will say, “well, I have 300 open browser tabs right now”, and that’s a great mindset for many jobs. But if the job is just something super simple and uncomplicated, that might be the wrong person to hire. Other people do a version of like zero browser tab inbox and will just say, “I don’t have any browser tabs open right now”. That’s like a very neat, tidy mind. But arguably they’re not the best person for a certain kinds of creativity. But you’re getting at the question, what is it you actually do with your time?

Taylor Nicole Rogers
So if I, as a journalist, hypothetically, have like 60 browser tabs open, is that a good thing?

Tyler Cowen
Yes, that’s a good thing.

Taylor Nicole Rogers
Good to know.

Tyler Cowen
That means you’re processing a lot of information. You have broad interests. You’re juggling many balls at once, which is all the more common in today’s world of journalism, where everyone is overworked and underpaid and that you’re managing to make it work. And then when I asked you about them, you would have this wonderful command of detail about what you were thinking about and what you were reading and what your thoughts were. So, yes, definitely a good sign.

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Isabel Berwick
So Anjli, how many browser tabs have you got open?

Anjli Raval
Oh well, luckily, or unlucky for me, Google kind of shut me down before I came here. But before that I had probably about a dozen tabs open, various stories I’m working on and chipping away at. The thing with that question is that I don’t ever think in an interview context anyone’s going to be entirely truthful because there will be things that you actually don’t want your potential employer to know about, what you’re reading or what personal stuff you might be doing in your work time. But there is an interesting point that you probably do get a sense of how somebody thinks, how somebody likes to work, whether their mind is completely overloaded, or are they somebody that likes to have very clean straight lines and think about things one at a time.

Isabel Berwick
Yeah. A similar question might be “is your desk messy or not?”

Anjli Raval
No, my desk isn’t messy. But my browser activity is incredibly messy. So I don’t know if the two sort of correlate.

Isabel Berwick
Maybe not. Maybe not. But Tyler made an interesting point about how bias affects our hiring.

Tyler Cowen
Well, I would just say we have two chapters that are not always found in other talent books. One is on what are the special problems in evaluating the talents of women and why men often are not so good at it, and we offer some definite tips there. And another is, we have a whole chapter on how to hire what are sometimes called disabled people — I’m not saying they’re all, in fact, disabled — on that you can find remarkable talent there. And part of our vision is to help raise the bar in terms of social achievement by making people better at finding talent in unusual, overlooked or neglected places.

Taylor Nicole Rogers
OK. I have to ask, why are men not good at spotting talented women?

Tyler Cowen
On average — and I stress the phrase on average — a lot of smart men tend to underestimate just how smart the smartest women can be, and other women are better at seeing this. So really making a point of having at least some women on your hiring committee or search committee. And men also, very often, they tend to overestimate the personality features of the woman. So if the woman is likeable, men tend to think she’s a better hire than she actually will be. If the woman comes across as a little difficult, men tend to assign that far too much importance as a negative. So men are overreacting to personality and underreacting to intellect, and (A) have a woman on your hiring committee, but (B) even if somehow you can’t do that, let’s at least have the men more self-aware of their biases and give women more of a fair chance.

Taylor Nicole Rogers
Is bias a big problem in hiring?

Tyler Cowen
Bias is a tricky phrase . . . but yes, bias is a big problem. We want to hire people who are like ourselves and people whose merits we can appreciate rather easily. So one purpose of the book is just to give people a bigger picture view so they can appreciate a lot of different kinds of talent rather than talent that just matches up to how good they might be. So a nerd maybe can appreciate another nerd, but how well can a nerd appreciate an extrovert? That’s the kind of skill we’re trying to teach people.

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Isabel Berwick
That’s really interesting. Anjli, what have you found are the latest trends around securing and retaining people? Because I’ve heard stories, for example, about tech companies paying people to attend interviews in sectors where there are very scarce numbers of people for the jobs. Is it happening anywhere else or is tech a particular outlier? And where are the big shortages in the war for talent?

Anjli Raval
The first thing is what’s on offer and how employers are trying to secure the talent they want. So the obvious way is to have higher pay, bonuses, all manner of kind of one-off handouts. But companies are actually doing a whole manner of other things as well. I recently came across a company saying that if you’ve got an electric car, you can charge your car at work. This is also another way to get people back into the office, of course, employee discounts for retailers. All manner of things like that, that are just seen as optional extras, but they do help when it comes to thinking of an overall kind of compensation package. Employers are also looking at how they think about an employee’s contribution into their company and giving them more of a seat at the table. And then there is obviously this flexibility piece that we’ve talked about already. More and more people just do want to dictate how they manage their day, where they work from. There was one instance I came across where there was an individual who wants to be based out of Poland for a job that was recruiting from London, but be paid a London salary and then also get flights paid for to go to their headquarters in the US. And the company said yes, because that was somebody that they really wanted to hire. In this piece that I wrote recently, it was very clear to me in the reporting that actually the skills shortage is across the board, whether it be construction, hospitality, life sciences, obviously tech. But we’re going through a shift in the global economy, right? Tech companies, for example, are saying that we’re going to issue hiring freezes or cut jobs. There are other sectors where you’re not seeing the crunch quite so severe. However, a huge number of companies are saying that they are going to still carry on hiring through any down period because what they’re worried about is when there is the eventual uptick, the people that they want and need won’t be there. I spoke to a property developer and they said that they would do that because they know that they need to prepare for the future.

Isabel Berwick
So it’s sort of talent holding in a way.

Anjli Raval
In some ways, it is. But they’re not holding because they know that they will need that talent in the time to come. I don’t think people are going to be sort of sat there twiddling their thumbs. I don’t think any company is in a position to just be paying people for nothing. Everyone is watching their costs. But there is this sense that the skills shortage is something so structural and so huge that despite any kind of economic downturn is still going to be there.

Isabel Berwick
And do you think that the things that employers have to do to hang on to people are different from the things they do to recruit them in the first place? Because there are two bits to this really, isn’t it? There’s recruitment and then there’s retention because there’s a pretty high turnover. Some people start jobs, get a better offer and leave. So how do you retain? Is that a whole different set of priorities?

Anjli Raval
In some cases, it is. In other cases, it’s not. I think what becomes more relevant for people who they’ve already hired is that kind of giving people a seat at the table, having them more involved in day-to-day decision-making, if that’s what they wish for, all that kind of stuff. You can’t quite measure . . . 

Isabel Berwick
Corporate culture stuff, essentially.

Anjli Raval
It’s corporate culture stuff, exactly, that really gives people a sense of belonging and why they may choose to work and stay in a particular organisation.

Isabel Berwick
Casting your gaze ahead as the world perhaps heads into quite a deep recession, are in-demand skills always going to be in demand? And what would you say to listeners in terms of helping to make them in demand, even as we go into recession? What should they focus on?

Anjli Raval
Regardless of a recession, we’ve got jobs being created today that were just never needed before and now we need them. Largely, this has to do with tech-related jobs. Now, I don’t mean top jobs at technology companies, but it means that you now need AI experts and automation experts, all this sort of stuff that you never needed before. So there’s that, that will carry on trundling along. In terms of the recession or any kind of economic downturn, I think you will see a rise in things like being present in the office. It’s going to become more important because that face time and that kind of showing up element, I think, will become more important.

Isabel Berwick
All roads lead back to the office?

Anjli Raval
That’s what I think. I could be wrong.

Isabel Berwick
No, I think that’s a good point. I think it has been underestimated until this point in the pandemic, the importance of the physical workplace. And as we do go into a recession, you’re right. I think proximity bias is real. And it’s gonna be important for retention and promotion, actually.

Anjli Raval
And also, I think people are probably gonna be hustling a bit more. You want to be the first that hears about, you know, a job coming up in a particular department or a project that’s coming up that you would like to be involved in. And I can’t help but think, it’s just natural to think that if you are in the office, you know, 10 feet away from the people making these decisions, that’s probably better than being at home behind a screen.

Isabel Berwick
Yeah. Good old-fashioned earwigging gets you everywhere.

Anjli Raval
That just might be our journalistic . . . senses, you know.

Isabel Berwick
(Laughter) Anjli, thank you so much.

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So even if the world is heading into hard times, good people are always gonna be in demand. And I think as managers, we can ask more imaginative questions. And what Tyler was getting at there was finding out more about people as people rather than simply their skillsets. That’s a real shift in how we interview people, but I think it reflects a real shift in the world of work. And that sort of reflects how we are at work now with more blurred boundaries. But I think also there’s no substitute for being a team player for the hard skills that we need for jobs. And also, as Anjli was saying, thinking about the jobs of the future, what’s gonna be needed in five years' time, and how can you position yourself to get that job? Because it’s not just about what happens today. It’s about you as a manager or a staff member thinking about how you’re gonna work in future.

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Thanks to Tyler Cowen, Taylor Nicole Rogers and Anjli Raval for this episode. If you’re enjoying the podcast, we’d really appreciate it if you left us a rating and review on Apple Podcasts. And please do get in touch with us. We want to hear from you. And we’re at workingit@ft.com. Or with me @IsabelBerwick on Twitter. If you’re an FT subscriber, please sign up for our new Working It newsletter for some behind-the-scenes extras from the podcast and Work and Careers stories you won’t see anywhere else. Sign up at FT.com/newsletters.

Working It is produced by Novel for the Financial Times. Thanks to the producers Anna Sinfield and Flo de Schlichting, executive producer Jo Wheeler, with production assistance from Amalie Sortland and mix from Chris O’Shaughnessy. From the FT, we have editorial direction from Manuela Saragosa. Thanks for listening.

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