Can You win the Global Talent War

 

 

If you read my blog ‘Third World War begins Now – Recruitment Agencies Mercenaries or Allies?’ then you will know that over the next 5-15 years the world is a facing seismic escalation in the ‘War-on-Talent’. The 140 million shortfall in skilled workers that China alone will face by 2030 is testament to the scale of the issue.

 

So what do we do, sit and wait till it happens?

 

I hope not.

 

Retirement – There are a few home truths we are all going to have to accept and one in the UK is, in a society where we are living longer we cannot expect the younger generations to pay for our retirement. Consequently we will all need to work longer.

 

In 1946 when the NHS came into being in the UK the life expectancy of a man was 67 and the retirement age 65. Today the age at which people can draw their pension is only now rising from 65 to 70 but life expectancy is now into the eighties with the most common age of death for a man to be 85 and a woman 89. Ah but I hear you say ‘I have paid National Insurance all my life, I have paid for my retirement.’

 

Actually that’s not true. The reality is we have paid for our parent’s retirement. The reality is our children are responsible for paying for ours and sadly there are not as many of our children as there are of us.

 

For this reason I personally am expecting to be undertaking some form of employment into my early 70s. The difference being I do not expect to be doing a 37-hour week. That said my life expectancy is likely to be into my 90s given the rate at which it is growing.

 

The trend is happening now. Last year Saga Group published a quarterly report in Screen Shot 2013-03-13 at 18.11.27December that indicated that the number of over 65s in employment had risen by 124,000 in the past year. It would appear I’m not alone.

 

The nature of employment is going to change and society and we need to become more flexible.

 

Unemployment – In many societies globally this is a cancer that is consuming our youth and one we in the UK need desperately to look at. There are jobs in our economies, which need doing, but for some reason the supply side of the economy is not producing the skills we need.  To a degree this is a task for governments and the education community to take the lead on with support and input from employers. Dialogs take place but what we need is action.

 

We are already being told the skills gaps today exist in:

 

  • Information Technology
  • Engineering
  • Oil and Gas
  • Healthcare
  • Emerging Technology application

 

All the reports indicate these gaps are widening in the short to medium term and no one seems to be offering a remedy for them.

 

We need to see greater incentives for students to pursue careers in these disciplines rather and other careers for which the demands do not exist. Its sad but ‘market-forces’ may take 3-4 years to start to impact students university trends but I’m sure as a reader you have your views on this and I’d be delighted to hear them

 

There is another change that is taking place too.

 

New Employment Structures – In November last year McKinsey published an article in theirScreen Shot 2013-03-13 at 18.09.35 quarterly review entitled ‘Preparing for a new era of work.’ The article offers a range of solutions and is a must read for all HR and Recruitment professionals.

 

Like my blog last week, it identifies the emerging skill shortages and the changing demographics as a major issue, which they believe, will force employers to look at ways of using their highly paid skilled professionals more effectively.

 

They highlight the trend over the past 30 years of where ‘transaction-based jobs’ that could be standardized or scripted have been automated or shifted to low paid workers. Now they highlight the ‘knowledge worker jobs’ such as managers, sales reps, engineers, lawyers, managers, teachers and doctors which they label ‘interaction jobs’ as being the major growth area and vital for companies and countries a like.

 

These ‘interaction jobs’ already accounts for a very high proportion of jobs in society, roughly a third in developed economies and a quarter in developing ones.

 

Due to skill shortages, which are already affecting these jobs, employers are looking at the ‘interaction work’ within their organisations and considering ways this work is undertaken.

 

McKinsey’s highlight three ways organisations may respond.

 

  • Break jobs Down
  • Go Virtual
  • Make work more flexible

 

In the first situation we can already see this happening. In the NHS the role of Consultants and Doctors are being broken down and elements that can be are being delegated to Nurses or new functions. For example, today Phlebotomists exist in most modern health centres. Twenty to thirty years ago it would have been the doctor who undertook this work.

 

As recruiters we can expect new roles to emerge and organization structures to evolve to reflect these changes. We will also need to be flexible in our responses as it is essential that we support our clients on this journey by helping them identify and source people for these new roles and use our skills and expertise to source applicants with the right competencies.

 

In many cases direct like for like replacements may not exist. We will need to think outside the box and become creative with our solutions. The opportunity for us to partner with clients on this journey will be there. As recruiters we must demonstrate we have the knowledge to support our clients if we wish to fulfill the role of partner rather than a mere commodity supplier.

 

Going virtual is already happening and with the advance of hi-speed broadband home working will become the norm for many. In the US estimates are that 25% of all jobs could be performed remotely. This has implications for ‘where we live’ and ‘what jobs we can apply for’.

 

Living in Cornwall and working for a city firm starts to become possible. The Millennial generation (Gen-Y) will demand this approach and employers will react if they wish to secure the best talent and we as recruiters need to ‘get with it’!

 

Finally making work more flexible will happen. As the McKinsey report says

 

By breaking some jobs into components and using technology to virtualize others, employers can engage labor far more efficiently. Some companies are already exploring a spectrum of mix-and-match work arrangements: traditional full-time workers in the office, part-time or temporary workers, and contingent, remote workers who can help meet spikes in demand. Companies that optimize such configurations and manage them effectively can begin engaging talent as needed, thereby lowering overhead costs and improving response times. The key to this talent-on-demand model is the availability of workers with specialized skills who are willing to work on a contingent basis.’

 

So you see as we approach retirement and seek reduced hours our ability to support organisations ‘flexible models’ becomes possible. Whether its two or three day working, eight to ten week project work, as we all move towards our old age we still have a significant part to contribute.

 

My sense is employers who adapt and optimize these models will be the ones who survive. Those that cling to outdated rigid operating models will die.

 

The question for HR and Recruitment Agencies alike however  remains

 

‘Is failure an option?’

 

Feel free to comment or tweet your responses.

 

 

Third World War begins Now – Recruitment Agencies Mercenaries or Allies?

 

 

Dramatic? Possibly but the scale of what the world faces over the next few years is beyond anything we have ever experienced in our history and the consequences for the global War-on-Talent are massive. Read on and form your own opinion.

 

In recent months there have been a number of reports released which collectively reveal how the global employment world is about to go through a seismic shift. It may seem odd when we have high levels of unemployment in most of the major industrial nations but there is a global shortage of skilled workers.

 

Recent research by Accenture Management Consulting indicates that business leaders believe access to appropriately skilled workers is essential for economic recovery but worryingly more than 50% say it is difficult to recruit entry level workers with the desired skills.

 

Alarmingly Accenture’s Turning the Tide: How Europe can Rebuild Skills and Generate Growth points to the issue continuing as businesses cut back on training despite acknowledging their own needs for staff. As demographics start to impact our workforces demand for entry level workers is about to accelerate.

 

According to the McKinsey Global Institute’s report,“Preparing for a New Era of Work.” in the United States, the gap between the number of people graduating from college and the number of college graduates businesses require will be 1.6 million graduates by 2020.

 

In Europe a shortage of 23 million college-educated workers will exist by 2020. Whilst new IMF paper – “Chronicle of a Decline Foretold: Has China Reached the Lewis Turning Point?”states that by, 2030 China will have a total workforce shortage of almost 140 million workers. “This will have far-reaching implications for both China and the rest of the world,” said the IMF.

 

China cannot avert their demographic cliff, as a result of the effects of low fertility rates – and the one child policy. It will take them over fifty years to turn it round. Even now the Chinese battle for our talented youngsters is starting.

 

During a recent open day I attended at one of the UK’s top universities for fashion design, the University of Westminster, the head of department stated that China was rapidly becoming the number one destination for many of his students with the Chinese paying good money to attract his top talent.

 

The IMF study found that—thanks to global competition, changing demographics and persistent “geographic mismatches” between the supply of workers and the demand for them—a stark skills shortage is emerging worldwide.

 

When you consider that 140 million is the combined population on the UK and Germany you don’t need to be a genius to realise that some of these shortages have strategic implications for nations.
Where are the shortages going to be most acute?

 

A review by Adzuna which was summarised in the  Daily Telegraph , at the end of last year pointed to IT, Healthcare and engineering as being the sectors in highest demand. The boom in Oil and Gas has been one that is globally overheating too with well publicised shortages there too. With the number of new recruits to these industries showing no signs of exceeding short term demands its clear the role for niche recruitment agencies operating in the sectors is set to continue.

 

Will recruitment agencies choose to exploit this market and sell their skills to the highest bidder or will they align themselves with the major global corporate players who will need their support and secure lucrative corporate contracts. It is going to be interesting to watch.

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For me the the critical battle ground will be Social Media. The ‘millennial’ generation are the ones where the skill shortage will be most acute and these are the most social media savvy generation. Win this battle recruiters you win the war and your prosperity is assured. Lose it and you will become as current as the dodo. The choice as they say is yours.

 

 

In next week’s blog I will be looking at ways the industrialised nations can respond to the Global War-on-Talent.