In the middle of all the heated discussions about the persistent unemployment numbers in the media, in coffee shops, around water coolers, and at kitchen tables across the country, what’s most overlooked is this sobering fact: despite the alarming number of unemployed Americans (about 13 million), a whopping 3 million jobs remain unfilled.
Experts have numerous theories on why this is so, but it really just boils down to this: there’s a clear disconnect between the available jobs and the talent required to fill them. It’s been referred to as the Talent Paradox, and by all accounts it will likely only worsen in the near future.
Why Companies Must Address the Talent Paradox Now
It’s not that companies aren’t trying to fill these open jobs. They are, but their recruiting efforts aren’t bearing much fruit. One would think that the Talent Paradox is especially prominent in the so-called STEM professions (Science, Technology, Engineering, and Math), but manufacturing and even the trades are hurting, too. Manufacturers report that as many as 600,000 jobs remain unfilled. The HVAC, electrical, and transportation and trucking industries are also facing labor shortages as boomers near retirement and fewer younger workers are stepping up to take their place. Healthcare is yet another industry with its own labor shortage problems, especially nurses but also primary care physicians as well.
Companies have stepped up their hiring efforts and have begun to take a closer look at their retention and training opportunities in order to maintain the workforce they do have. They understand that turnover can be costly, and that labor shortages can mean the difference between growth and stagnation, or worse.
With approximately 10,000 Baby Boomers reaching retirement age every day, however, and fewer students graduating college with the skills needed to fill these shortages, it’s clear that despite their best efforts, companies may face an even worse skilled labor market in the very near future. If their businesses are to survive and remain competitive in a globalized economy, more must be done on a national and local level by both the private and public sectors to address this looming labor crisis.
Only the Talent-Rich Will Survive
Fortunately, some companies long ago foresaw the coming “talent war” and have put in place programs and incentives to lure the best of the best to their payrolls. Most people are familiar with the jaw-dropping employee perks offered by the likes of Google (on-site childcare, free haircuts, gourmet food, and the chance to work at a company whose motto is “Don’t be evil”) and Facebook (free meals, fully stocked kitchens, 4 months paid parental leave, and even its very own Main Street). Even smaller, lesser-known companies like oDesk, however, recognize the need to beef up their total compensation packages to attract the workers they need to support their growth. And in healthcare, hospitals are paying big bucks to send motivated and promising workers back to school to earn higher degrees in critical shortage areas such as nursing.
These companies understand that the unemployment crisis isn’t going to help them find the workers they need. They understand the Talent Paradox and have been proactive in addressing it so that they can remain competitive in the New World of Work. They’re very aware of the fact that while the IBMs and General Motors of the past may have survived and thrived in a traditional corporate environment that emphasized job security, strong hierarchies and paternal organizations firmly rooted in local communities, the future belongs to those that embrace a workplace where jobs have become fractionalized, virtualized and globalized. They’ve seen that future, and they want to be around to enjoy it.
Not everyone has been so prescient, however.
The Talent Shortage Crisis
Entire industries remain stuck in the past. They realize that the unemployment crisis isn’t helping them, and that a severe lack of qualified workers hampers their ability to grow, let alone thrive. And yet they continue to pursue the same strategy as they always have to try and recruit workers. Their emphasis is on harvesting as much of the available labor pool as they can, poaching from competitors as necessary.
The skilled trades serve as glaring examples. Jobs in HVAC, construction, energy, and other industries have become more complex, requiring a higher level of education and technical skills. Yet recruitment is the name of the game, and despite the widespread understanding that talent shortage is one of the biggest threats to these industries in the very near future, most companies continue to act as if somehow the problem will take care of itself. It’s clear that these industries face numerous obstacles: lack of training opportunities, diminished public funding for vocational schools, a reputation for “unglamorous” jobs.
Yet rather than address them head-on with a clear strategy that might include expanding educational opportunities through private support, greater focus on retention, or even bringing back the old apprenticeship system, industry leaders and business owners remain steadfast in their belief that shoring up their shrinking talent base is someone else’s problem.
That’s a harbinger of an industry in crisis.
Working Solutions’ CEO Tim Houlne and I address the idea of talent as a competitive advantage in greater detail and depth in our forthcoming book, The New World of Work, and I encourage you to sign up on the book’s website for updates and information about what this paradigm shift means to both workers and companies.
In the meantime, however, I urge you to think about your own companies and how you’re addressing the coming talent shortage. Make no mistake – nearly every industry will undergo one if they haven’t already, driven by drastic changes in demographics and technology. Are you ready?
Learn More About The New World of Work
I will be presenting at the upcoming Customer Contact 2012, West: A Frost & Sullivan Executive Mind Xchange. If you are attending, please join us at 7:30 AM on Monday the 22nd at the Solutions Showcase or the Best Practices Breakout on Monday – The New World of Work: From Cube to the Cloud. I look forward to seeing you there!