The debate as to whether or not there will be a talent shortage rages on. In my opinion, it’s inevitable and it will be huge. Many companies have their heads in the sand and don’t or won’t see the ball rolling toward them. Let’s take a closer look by separating perception from reality.
The high unemployment rate has resulted in a large talent pool to draw from.
There are available bodies so companies believe, rightly or wrongly, that they are in the driver’s seat.
The reality is that there is complacency among employers. The economic downturn has caused many companies to fall into a malaise when it comes to talent. Once the economic downturn is over, the first to get jobs, as usual, will be the most talented; the very same employees companies have chosen not to down size. Most of these people have been worked liked race-horses and are just bidding their time to jump ship.
The economic downturn has caused the Millennials (born 1977-1997) to mellow.
The Millennials, known for changing jobs every two years, have been forced, due to a lack of job opportunities, to remain with their companies longer than they expected. They have also not been as vocal regarding their wants, needs and sense of entitlement.
Fortunate to be able to move back home, the Millennials are waiting until the economy improves. If anyone thinks that this cohort group has really mellowed they are in complete denial. Their sense of entitlement among other things is part of their DNA. It’s like trying to change a tiger’s stripes. I have heard more than one say, “we’re out of here, once the market picks up.”
The cut backs in leadership development programs were necessary for survival.
Perhaps for survival but not for the bottom in the long run. The poor economy has made investing in leadership development challenging. Companies have not only scaled back on these programs but they have also downsized entire training and development departments. This is a monumental mistake which will come back to haunt those at the top big time.
What compounds the situation even more is that for years companies have traditionally focused solely on developing their “A” players – at the expense of their solidly contributing middle performers – their “B” players. This untapped pool typically makes up 70% of an organization - a sizable force toward increasing the bottom line.
Now companies have also stopped the development of many of their “A” players – their future leaders leaving them with a talent deficiency that will impact them for years to come.
Companies believe they have a steadily growing workforce.
Yes and no. The Millennials are as large a population as the Boomers (born 1946-1964) were when they entered the workforce - maybe even larger. Although currently making up approximately 22% of the workforce, Don Tapscott, Growing Up Digital, says that by 2014 the Millennials will represent 47%, with the next generation – known as Digital Natives or Hyper-connected (born after 1997) - coming up behind them. While there is growth, we have to consider a few things:
What we are going to have is a large group of inexperienced employees (Millennials) being managed by a small group of Generation Xers (born 1965-1976) many of whom never received the development needed to lead (read my post Career Advice for Generation X for more information about Gen Xers), let alone lead the challenging Millennials.
We will have an aging workforce. According to Pew, half of all working adults in the U.S. between 50 – 64 say they will delay retirement and 16% say they will never stop working.
We also have a shrinking workforce with fertility rates dropping in Europe, Asia, South America and India – resulting in a war for talent.
Taken together this should be a call for action for U.S. companies to rethink strategies for engaging employees and leadership development. Now is the time to revisit their talent acquisition process and employment brand, so they are prepared to attract the best candidates as the economy improves along with their business needs.
Generational Demographics - United States Census Bureau