Marsh Philippines flags talent acquisition pressures as workers grow more selective

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Marsh PH talent acquisition pressures

Highlights

Marsh Philippines' 2026 Talent Acquisition Study reports 78% of organizations cite attracting top talent as their greatest hiring challenge despite a 95.1% employment rate.
80% of organizations see AI and automation as key for talent acquisition over the next three years, but only 23% are fully prepared and using AI in recruitment.
Skills-first hiring is a strategic priority for 52% of organizations, with 76% updating job descriptions and 72% adopting assessment tools despite operational integration gaps.

Hiring pressures and AI readiness in 2026

As reported by BusinessWorld, citing Marsh Philippines, its 2026 Talent Acquisition Study in the Philippines shows that 78% of participating organizations see attracting top talent as their biggest hiring challenge. The study also says 74% cite changing candidate expectations and 69% point to limited talent pools for critical skills as major obstacles.

The pressure comes even as macro employment indicators remain steady. The Philippine Statistics Authority reports a 95.1% national employment rate as of June, but Marsh Philippines Workforce and Rewards Practice Leader Sean Darilay says employers still find it harder to secure the talent needed for expansion as workers become more selective.

Marsh's study finds that 80% of organizations view artificial intelligence and automation as the opportunity most likely to positively affect talent acquisition over the next three years. Yet only 23% describe themselves as fully prepared and actively using AI technologies in recruitment, while 43% say they have no defined AI governance roles or frameworks.

Current AI use remains focused on lower-risk tasks, including creating job descriptions, sourcing and engaging candidates, and generating recruitment marketing content. Darilay says interest in AI is running ahead of readiness, adding that companies stand to benefit most when adoption is paired with clear governance and human judgment in hiring decisions.

Skills-first hiring and candidate experience shape competition

Companies are also shifting away from traditional credentials such as job titles, tenure, and educational pedigree in favor of skills-first hiring. Marsh's research shows 52% of organizations identify skills-first hiring and dynamic role definitions as a strategic priority, while 76% are updating job descriptions to reflect dynamic skills and 54% are building skills- and competency-based interview guides.

To support that transition, 72% of organizations currently use assessment tools, with functional and technical skills tests the most common at 81%. But operational gaps persist, with 61% citing weak integration between assessment tools and core human resources systems and 48% pointing to insufficient internal expertise to analyze assessment data.

The study suggests employers now need more than pay to attract high-caliber talent in 2026. Benefits and perks, as well as employer brand and reputation, each rank at 61%, ahead of salary and compensation at 60%, while learning and upskilling opportunities stand at 58% and career advancement prospects at 52%.

Candidate experience is also emerging as a competitive differentiator, with 70% of organizations rating it extremely important. Marsh Philippines Chief Executive Officer Paulo T. Garcia says employers that combine a strong employment proposition with a fast, transparent hiring process, skills-based assessment and a clear AI strategy are best positioned to attract and retain talent.

The study is based on responses from 91 companies representing 93 entities, collected between May and June 2026 across industries including shared services, manufacturing, high technology and financial services.

In our earlier article on how AI is reshaping competitive baselines for businesses, we noted that companies face growing pressure to adapt their operating models as “average” performance becomes less viable. The piece emphasized that AI can lift productivity and efficiency, but only for firms that pair adoption with investment in skills, decision-making, and broader process changes—while laggards risk losing relevance.

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