There has been a tremendous amount of discussion and debate over the so-called “Talent Shortage” for the last few years now. My question is this: Have you done anything beyond just pondering the potential consequences of this scenario?
Specifically, have you taken any action either strategically or tactically to make sure that your business has the necessary talent to continue to be competitive in the market as the employment landscape changes? In today’s post, I’ll share my thoughts on what I believe is a very real threat to many businesses that do not make adequate preparations…
Let’s begin by looking at some of the numbers surrounding the state of the US labor force:
- The current American labor force numbers more than 76 million workers who were born between 1946 and 1964.
- Extrapolating on the demographics mentioned above, estimates are that as much as 40% of the US workforce will reach the traditional retirement age by the end of this decade.
On the basis of pure numerical analysis, the story conveyed in the previously referenced bullet points creates a foreboding scenario for growing US companies. I have read many opinions that point to outsourcing jobs abroad as a potential solution to the talent crunch. After all, the impact of globalization on burgeoning labor pools in emerging markets such as India, China, Korea, Russia, Brazil, etc., is nothing short of phenomenal when compared to that of the US. However, as is usually the case numbers only tell part of the story. The reality is that the Talent Shortage is not US-centric, rather it is a truly global crisis. Just a few months ago the staffing agency Manpower Inc. released the results of a survey of more than 36,000 employers in 27 countries. It turns out that more than four out of 10 employers around the world are already having trouble hiring the right kind of staff for the right kind of money, and the problem is only getting worse.
Let’s look at India as an example…India is a country that puts almost 3 million highly educated workers into their labor force each year. India accounts for 65% of all IT work performed offshore producing more than 400,000 engineering graduates a year (5 times as many as the US). However, demand is starting to rapidly outpace supply even in India. Consider that last year alone Accenture had plans to hire 20,000 just in India, Infosys planned to hire 25,000, TCS has a headcount ramp that called for 30,000 new hires, Microsoft attempted to hire 7,000, and the list goes on. Keep in mind that these numbers were just for Indian hires alone…As you can see the competition for talent is already fierce and the full impact of the global talent shortage hasn’t even come close to reaching its peak.
The bottom line is that companies that are not already focused on full-cycle talent management initiatives will be left in the dust by more aggressive competitors as the supply of available talent continues to constrict. It is the companies that today apply serious and focused efforts toward embracing proactive talent management strategies that will be most likely to win the war for talent. If you think you can ignore the numbers outlined in this post, or that you have plenty of time and can wait until later to address the issue I believe you may be regrettably delusional in your thinking.
