A new report suggests that engineering employers will increase their workforces in 2012 and will focus on employee retention to maintain their skills sets.

The 2012 Michael Page Engineering & Manufacturing Salary and Insight Report, a qualitative update from across the company’s client base, found that businesses have been reviewing their production processes in light of restrained levels of domestic consumer demand.

This in turn has caused strong demand for engineering expertise, which is anticipated to be a continuing trend in 2012, with more than half of respondents expecting their employee numbers to increase this year.

Colin Monk, Engineering & Manufacturing managing director at Michael Page, told The Engineer that challenging conditions over the past two years saw employers hire experienced engineers with a high degree of technical expertise.  

‘The challenge that came from this was that salary expectations increased,’ he said. ‘The view was then taken: what do we do in the long term? If we can’t afford to compensate people on an increasing basis then what do we do underneath? How can we integrate more skills and people beset with skills capable of dealing with another downturn?’

The survey found that 88 per cent of respondents were prepared to face this challenge by making hiring decisions based on a candidate’s alignment to team values.

‘What a lot of organisations have looked at and said is that if they can’t afford a lot of very experienced skills sets then the alternative is to bring people in who are an extremely good team fit, who have a base level of skills and potential,’ said Monk.

Once in work, one third (32 per cent) of all respondents said promotion opportunities were the most important retention strategy, followed by 23 per cent who cited a comprehensive benefits package as important. Meanwhile, 77 per cent of respondents expect salary or bonus increases in 2012.

Monk said: ‘That 77 per cent is essentially a large pool of people who have seen salaries generally remain about stable and are now expecting either increased chances of promotion or an increase through other retention strategies.

‘This could include flexible working practices or an increase in benefits, whether that be pension contribution, getting-to-work schemes or being able to have the flexibility to pick and choose benefits in order to set up their remuneration structure. Not everyone will get promoted but retention is very high on the list of being able to keep good skills within an organisation.’

The survey was derived from small and medium-sized enterprises (80 per cent), larger international organisations (15 per cent) and start-ups and VC-backed small ventures (five per cent).