THE GOOD NEWS

·         "The economy seems to be picking up."

·         "Companies are hiring again."

·         "Companies are worried about keeping their top employees just as much, if not more so, than they were during the boom of the late 90's."

Theses quotes from my clients and colleagues suggest that the economy is growing.  The following data released in April 2005 offers further support: 

·         The unemployment rate dropped to 5.2 percent from 5.4 percent, matching its lowest level in more than three years.

·         Average hourly wages rose .3 percent to $15,95, slightly higher than expected.

In the financial services industry, data from the US Bureaus of Labor statistics suggests that between 2002-2012:

·         The fastest growing jobs in the financial services industry will be personal financial advisors (34.6% growth rate), tax preparers (23.2% growth rate), and accountants and auditors (19.5% growth rate)

·         Average job growth across all occupations is predicted to be at 14.8%

Many analysts believe that economic growth may slow a bit in April-June 2005.  While not meeting the growth projected by this administration, the economy is expected to grow at a healthy enough pace to spur decent job gains in the months ahead.

THE BAD NEWS

Job Skill Shortage

There are not enough people with the right skills to fill all the jobs available and. . .  it's going to get worse.  Many of these shortages are currently found in the skilled trades such as construction, healthcare, certain jobs in the IT sector, and truck drivers.  For example:

·         The national nursing vacancy rate is approximately 13%.  Enrollment in RN programs has declined by 22%.  The average age of an RN is 43 years old.

·         Just this year, Google announced it was unable to meet their growth expectations because they could not find enough qualified technicians.

·         In the past, the US has always had a steady stream of skilled talent coming to our schools to education and then to get jobs in the US.  Over the past few years, fewer people have requested educational visas and international student enrollments are decreasing.

As the economy grows, many more shortages in other occupations and industries will develop. 

Shortage of Workers - Myth vs. Reality

There has been much debate and controversy about a possible shortfall in the number of workers relative to the number of jobs in the future. The workforce is again and there are more people leaving/retiring from the workforce than entering it.  The latest research and data suggests, however, that there will be a surplus of workers in the future.  Specifically, according to experts from the Bureau of Labor Statistics, the number of available workers will exceed the number of jobs in the future.  Every job, however, will NOT have one or more qualified employees available to fill it.  The real shortage we face involves selected skills not head counts.  According to many industry experts, we're moving into the most severe shortage of skilled workers that this country has ever seen.  The competitive labor market of the late 1990's will pale in comparison to what's predicted in the future.

WHAT YOUR ORGANIZATION NEEDS TO DO TO BE READY

Given the unique and problematic combination of economic growth and a severe shortage of skilled talent, here are some things your organization can do to effectively deal with the challenge:

·         Improve your hiring and promotion processes so that you better match a person's skills and talents with the job and with your company's culture.

·         Find out what employees want (especially the older ones) and use that information to create an environment and benefits that will attract and keep them.

·         Train managers on what they can do to improve employee satisfaction and retention.

·         Hold managers accountable for employee retention.

·         Measure turnover and the cost of turnover, especially for the key jobs in your organization that have the most impact on profitability and productivity.

·         Recognize/promote employees whose behavior is consistent with your organization's values

·         Terminate or reassign employees whose behavior is inconsistent with your organization's values.

Companies who "stick their heads in the sand," and pretend that this problem doesn't exist will suffer in terms of their overall profitability and productivity.  The companies that plan and take action to address these issues will be in the best position to compete and thrive in the years to come.

More Resources

For more information on issues related to the skill shortage and the aging workforce:

·         American Association of Retired Persons (www.aarp.org); the premier website for information and other resources for people age 50 and older; check out their Featured Employers in the Money and Work section of their website

·         Bureau of Labor Statistics (www.bls.gov); the principal fact-finding agency for the Federal Government in the broad field of labor economics and statistics