Bridging the Talent Gap

Posted on September 20, 2011 in News

Bridging the Talent Gap

By David R. Butcher

The number of employers struggling to fill certain positions is at an all-time high, even with severe unemployment, a recent report says. Organizations are looking for increasingly specific skill sets and taking longer to fill job vacancies, yet the shifting job market requires a new way for employers to address how they fill positions.

Despite the slow and uneven economic recovery, along with lingering high unemployment, many organizations around the world continue to report they cannot find the talent they need when they need it. Globally, one in three (34 percent) employers reports experiencing difficulties filling positions due to lack of available talent, according to ManpowerGroup's 2011 annual Talent Shortage Survey of nearly 40,000 employers in 39 countries and territories.

Released this summer, ManpowerGroup's research reveals that employers in the United States, China, Germany and India report the most dramatic talent shortage surges compared to last year.

Based on responses from more than 1,300 U.S. employers, 52 percent of U.S. employers are experiencing difficulty filling mission-critical positions within their organizations, up from 14 percent in 2010.

In the U.S., the top 10 hardest jobs to fill were: skilled trades; sales representatives; engineers; drivers; accounting and finance staff; IT staff; management; teachers; secretaries/administrative assistants; and machinists/machine operators.

Globally, nine of this year's top 10 hard-to-fill jobs — including technicians, skilled-trade workers, engineers, laborers and production operators — also appeared on last year's list, and nine of the same 10 positions were also proving problematic for employers to fill in 2006, the first year Manpower's survey was conducted.

Why have these jobs perennially been on the list? According to Manpower's findings, the answer is simple: The jobs have changed, as have the skills required to perform them.

"As we know from the persistently high unemployment rate, job seekers are plentiful, but employers are engaged in an ongoing struggle to fill positions," Jonas Prising, ManpowerGroup president of the Americas, said in a statement. "Ultimately, the underlying reason for this gap between available talent and desired talent is simple: jobs have structurally changed over time, and the skills needed to fulfill these roles have, too."

Approximately three-quarters of employers worldwide cited a lack of experience, skills or knowledge as the primary reason for the difficulty filling positions. However, only one in five employers is concentrating on training and development to fill the gap. Merely 6 percent of employers are working more closely with educational institutions to create curriculums that close knowledge gaps.

"The fact that companies cite a lack of skills or experience as a reason for talent shortages should be a wake-up call for employers, academia, government and individuals," according to Prising. "It is imperative that these stakeholders work together to address the supply-and-demand imbalance in the labor market in a systematic, agile and sustainable way."

There may also be an increasing imbalance between employers' willingness to pay higher salaries in what is still a soft general labor market compared to the salary expectations of prospective employees, especially those with skills that are in high demand.

Compensation in manufacturing has stagnated over the past decade, even as the median cost of replacing employees in the manufacturing sector is $5,000 per employee, compared with $3,000 per employee in other sectors, according to a 2010 report by the Sloan Center on Aging at Boston College.

Beyond cost, manufacturers face the challenge of transferring knowledge to the next generation of employees.

What can employers do to navigate this complex and challenging landscape?

According to Manpower's findings, employers are already using a range of strategies to overcome the difficulties they face in finding the right talent, at the right time, in the right place. Realizing the importance of retaining mission-critical talent, they are more focused on staff retention, taking a "one size fits one" approach to training and development, tailoring it to the individual and helping to build the specific skills needed for business growth.

Along with its Talent Shortage Survey findings, ManpowerGroup published a paper titled Manufacturing Talent for the Human Age, which makes recommendations for how employers should address talent scarcity in the face of an abundance of available workers.

Suggestions include adopting a holistic workforce strategy, updating work models and people practices to reflect the realities of the 21st century and collaborating with governments, academia and individuals.

"Employers must reconsider their work models and people practices, and develop a robust workforce strategy that in a sense 'manufactures' the talent they need to execute their long-term business strategy," the paper states. "Sticking to old assumptions on how to structure and organize work, how to develop and incent talent, and where to source it, will leave businesses in peril."

Manpower makes clear that the "manufacturing" of talent is not an overnight process. It takes time to develop, and companies must strategize accordingly.

"[E]mployers must adopt long-term workforce strategies aligned with their business strategy to replace 'just in time' hiring as their main focus, as 'on-demand' talent will simply no longer be available," Manpower states. "The solution is to think more long term about talent and how to 'manufacture' it by implementing a workforce strategy that effectively forecasts the needs of the business, the talent required to achieve their goals, and where they can find it. They must also be more innovative and flexible in terms of developing the talent they need."


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