In the late 2000s, major headlines concerning the economy and jobs were usually related to unemployment. Qualified people might struggle to get an interview or retain a position in a volatile job market. This was especially true for millennials graduating college at the height of the most recent financial recession in 2008. But unemployment is at a historic low here in the new decade, so it’s no longer the employee struggling to find a good fit—it’s the employer. From Factory to Cubicle
Since the 1940s, the U.S. economy has been moving further and further away from manufacturing as its primary labor market. In fact, it’s estimated that 900 million service-based jobs have been created in the past 30 years alone. With technology and industrialization moving at a rapid pace, many economists fear there won’t be enough qualified people to fill new jobs. A McKinsey Quarterly article stated that by 2020 the world could have 40 million too few college-educated workers, and developing economies could have a shortage of 45 million workers with secondary-school education and vocational training. In more advanced countries, the number of employees lacking the right skills could be as high as 95 million.
An Employee’s Market
If our economy were a poker table, employees would be the dealer. Among the small pocket of those qualified for the booming amount of jobs created, it’s really an employee-driven market, and top talent is driving the next move. Studies show that high-performing and highly-qualified employees will “shop around” for organizations that align with their core values, even if that shopping around is at the expense of the company’s needs or bottom line. In short, company loyalty is decreasing at a rapid pace.
Ways to Play the Game (and Succeed)
Keeping with our poker analogy, let’s take a look at the strategies employers are using today to help win the war for talent. According to the annual Business Pulse Survey by SunTrust, businesses are taking the following actions to attract and retain talent, in order to succeed in the labor market. Is there anything your business can glean from this list that will help boost employee engagement and retention?
- Increased wages (45%)
- Increased benefits (43%)
- Offering more flexible work arrangements (36%)
- Training current employees to fill vacant positions (31%)
- Hiring more employees that take up-front training (24%)
- Offering additional recognition programs (23%)
- Offering college loan repayment and college savings programs (17%)
Research shows that a company’s culture and its financial success are inextricably linked, and employees are the drivers of both metrics. Even the most buttoned-up hiring processes have gaps to fill, and hiring the wrong person is costly, time-consuming, and can have devastating effects on morale if it’s not executed well. 2020 is a great time to do an audit or reset on your hiring AND benefits process and ensure both are aligned to the changing labor market.