Consulting firm Statista recently reported that prior to the pandemic only 17% of Americans had jobs where they stayed at home for five days a week. This percentage has ballooned to 44% today. With remote work normalizing, organizations willing to contemplate staff, new and old, resident ‘elsewhere’ also increased dramatically. For firms considering international hires, an arbitrage game of finding the highest quality candidates in the lowest priced labor markets has been the game of choice for many. Today however, some of our clients report that larger firms are offering Silicon Valley salaries to hires in many traditionally lower wage regions and unsettling the entire market in the process. In other words remote will not necessarily mean cheaper.
The rush to traditionally lower cost markets has directly contributed to the success of firms such as Deel, which helps clients by managing the entire hiring process regarding contracts, payments, taxes and local fees in countries in which it operates (Brazil is it’s biggest currently). Deel has over 250 lawyers and has raised $206 million in three rounds in the last few months enroute to a valuation of $1.25 billion.
On another front, firms that have relied on stock options to attract and retain talent are finding the earth below their feet shifting. Employees will no longer trade cash for options, preferring both and knowing that there are many potential employers for which such tradeoffs are not required. Larger concerns are becoming far more effective in leveraging restricted stock units (RSUs) as both an attraction and retention device. This includes pure tech firms and more traditional firms (financial services firms, retail , professional services through to industrials) that have technology divisions competing for the same talent. As usual the U.S. has evolved at a different pace, with senior executives there expecting that the unvested portions of their existing RSU package will be swapped for similar incentives by the hiring firm. Many firms in Canada are unable or unwilling to step up in this fashion in order to consummate the hiring of executives making it difficult for ex-pats to rationalize opportunities back in Canada.
And finally, employees are beginning to manage their risks with start-ups by exercising their vested stock options after only one year and moving onto their next employer to pursue a similar one year vesting strategy. This options/shares ‘portfolio’ strategy is only possible in a world where frequent employee mobility is accepted and has no punitive effect on careers.
Interesting times! No wonder that VPs of HR are in such demand.
About the Author
Robert Hebert is the founder and Managing Partner of StoneWood Group Inc., a leading executive search firm in Canada. Since 1981, he has helped firms across a wide range of sectors address their senior recruiting, assessment and leadership development requirements.