Recruiting staff is getting tougher. This is particularly the case for selecting young, potential high-flyers. If there is an abundance of automobiles for sale in the world market, this is not the case for young talent. Ever expanding higher education systems may be mass-producing more graduates than ever before but do they have the qualities that 21st century employers want? In my experience, the link between education achievement and ‘employability’ has been broken. No longer can graduate recruiters assume that a degree means that graduates will be instilled with high performing work values and prepared to ‘give themselves’ to their jobs.

So how do companies, in this fight for global talent, make sure they are employers of first choice? Corporate branding is now a key issue. This is where HR and the PR department need to get together. Talented young people are very aware of how the reputation of the company they work for ‘spills over’ to their own peer group reputation. Branson and the Virgin brand still benefits from this as witnessed in the demand for vacant posts at Virgin Atlantic, for example. At social gatherings, in the bars and clubs, young people assess each other in terms of their jobs and the companies they work for.

Corporate branding has to reflect core values and today, these are often to do with sustainability and social responsibility. This is the problem that many large companies now have in attracting the best young talent because young people are very suspicious of corporate PR. They are the ‘scarred’ generation. The have seen their mums and dads, dedicated to their jobs for years, only to be made redundant after that last acquisition and merger.

For companies to present themselves as socially responsible and sustainable organisations, they must have coherent, strategic HR strategies in place that put personal development at the top of their agendas. For how many years have we been talking about ‘putting people first’ but in reality putting them last?

Staff retention will be a growing challenge for many companies over the next decade. In a knowledge economy, skills are more easily transferable. Scarce talent can easily shift from one employer to the next. Equally, it is easier for knowledge workers to quit their jobs and set-up their own businesses. This is a common occurrence in the media and financial services sectors.

This means that HR policies need to focus upon developing leadership skills at all levels within organisations. It is a matter of rolling out training programmes so that business heads abandon their management hats-seeing themselves essentially as the givers of orders and the monitors of behaviour- and becoming leaders who their staff admire and trust. Who, in short, inspire them. Because that is what talented young people want from their employing organisations. Generation ‘I’-as in i Pod- will not be told what to do. But they will be inspired by people they admire, and through this they do become committed employees keen to come up with creative ideas that contribute to product innovation and profit-focussed growth.

These conditions are more likely to be found in small businesses. This is why young people are more attracted to them. The challenge for big corporate HR is to contribute to creating this small business climate in their own companies. In the 21st century, the western knowledge economies can only compete by recruiting and retaining the best available talent. To be employers of first choice, large companies will need to re-invent themselves as groupings of small firms where cultures of leadership, commitment and fun-yes, fun-prevail. This is a demanding agenda but if HR is not bestowed with this responsibility, who is?