Articles

WORK FORCE OF THE FUTURE

Where are we headed?  What do we do?

Background

In the early 90’s as our country was feeling the effects of a recessionary period, employers were lulled into recruiting complacency … there was an abundance of workers and not enough jobs.  The late 90’s gave employers a taste of the “war for talent”.  The economy was strong.  Jobs became plentiful.  Talented people had their pick of places to work.  Employers were paying high salaries and hefty signing bonuses for even “B” and “C” talent. 

But in 2000, the economy slumped again.  Employers became wary, cautious, guarded.  Suddenly talented people who had been recruited at great expense, were now on the layoff list.  Hiring new staff was not a priority. 

As the economy has gradually improved in the past 2 years, employers are once again vying for top staff members.  Even though the economy is not back to the level of 1999 – and early 2000, there is now renewed competition for competent workers.  Why?  If it is bad now what will it look like if and when the economy fully rebounds?  What is in the future for employers hiring replacements or adding staff for growth?  Consider the following:

• In only 3 years (by 2008) the 1st wave of baby boomers will turn 62.
• 40% of the current workforce will be at retirement age by 2010.
• 76.4 million Boomers will be replaced by 28.5 million X-ers.
• By 2010 the economy will support 167 million jobs with 157 million people to fill them  -  a shortfall of 10 million.
• During the recent recession, as a short sighted cost saving measure, employers cut back on their investment in employee training and development.  There is little “bench strength” in most companies.

Are We Paying Attention?

Very few companies are aware of these employment trends.  Few have considered how these trends will affect long term growth and profitability.  Strategically investing resources to attract and retain top human capital is relatively new territory for most companies.  Compared to more popular investments in customer, technological and financial strategies which have been refined over decades, few companies have embraced the talent management challenge.

The message is clear:  The demand for qualified employment candidates is skyrocketing due to impending retirement and a limited pool of sufficiently trained employees.  The transition is underway from a buyers’ market to a sellers’ market in labor.  In the next few years, companies will have no choice but to rethink the approach to human capital strategies.  In fact, employers who consciously create and implement focused staffing strategies will capitalize on a new way to compete. 

This is particularly true in the financial services industry.  The products among competitors are generally the same … it’s the employees who service the customers that give you the competitive advantage.  Without a competent, dedicated workforce to consistently provide quality service at a competitive price to customers, customers will gravitate to the competition, taking their wallets with them.  A stable work force will become the “new strategic advantage” in the next decade.

Talent Strategy Questions

• How does your organization define “critical talent”?

Critical talent is composed of individuals and groups who drive the largest share of the company’s business performance:  those who truly drive the company’s profitability.  These are the employees who create real value for which your company is most rewarded in the market place.  Be tenacious in understanding who these employees are or should be.  Plan deliberately how to move your staffing strength from where you are now to where you want to be in the future.

• Where can your company get this “critical talent”?

• How will your demand for critical talent meet supply? 

• How do you get in front of your competitors in attracting the “critical talent” you will need?

• How do you position your company to be “the employer of choice” to the limited group of critical labor force? 

• How does your company strategically partner with a staffing company?  Do you have a good relationship with a staffing partner who will ensure that you get first pick of available talent?

• Once you have attracted and hired the right talent, how does your company retain them?  Understand why people like working at your company and keep the focus on these issues.  Money is no longer the major motivator in attracting and holding top talent.  While good people expect to be paid well, they also want flexibility, challenging work, learning opportunities, workplace mentors and other “soft” benefits.

There is no way to avoid the labor issues that are coming.  But with good planning and solid answers to the tough questions above, you can position your company to come out on top and ahead of the competition.