The Changing Workforce

All business owners need to understand the implications of today’s skills shortage.  It is an important indicator that the ways we hire, develop, manage, renumerate and meet the aspirations of our people have to change, and so does the way we run our businesses.

Most developed countries sit in the same boat with an aging workforce and a declining birth rate.  The generation we call ‘baby boomers’, still a significant percentage of the workforce, are now reaching retirement age.  In time, the current declining birth rate is going to mean that fewer employees may be available to step into the shoes of the retirees.

The primary drivers of the looming skills shortage have been identified as:

  • technologies used in industries change
  • new technologies are emerging
  • established industries move into different regions with different skills bases
  • job seekers’ interests in industries and perceptions of work are changing

A skills shortage does not mean that there are lots of job openings.   Rather it refers to the demand for experienced workers with highly-specialised skills that can’t easily be found at a certain time. The demand may be erratic, making it unviable to train people to fill these positions because demand may quickly fall.

But what every business owner needs to think about is that it’s probably going to become increasingly harder to find skilled people.  That means you’re going to have to pay more to attract and retain them.  You may also have to make changes to your business to better suit the rare talent you need to retain.

After the relatively easy-going ‘baby boomers’ comes generations X, Y and the Millenials, who all have very different attitudes towards work than their predecessors. They’re not as malleable because they tend not to be so financially-driven, and they’re known to demand much more from their employers than a salary and a pat on the back.

Our younger generations have different ideas about work.  Many of them have grown up expecting to be fulfilled by their work.  They have stronger ideas about the type of work they will do and they also prefer to work for an ‘employer of choice’.  It’s more important to them to belong to an organization that reflects their own personal values. They want opportunities to grow and develop, to have access to the business’s leadership and to express their unique value through their work. These are not workers who will placidly do the same thing day after day.  Their experience of the world is about diversity, speed and ‘levelling up’ as fast as they can.

How to attract talent –

As the latest generation of experienced, skilled workers goes into retirement, businesses around the world need to re-consider their recruiting practices in a changed world to reach a new generation.  With the boom of social media, traditional recruitment via agencies and consultants has changed completely and you need to be present in the job-seeking channels talent uses .

Gone too, are the days of your value as a company that simply provides a living.  There’s a lot more that younger generations of talent want from you.  Employers today have to put a lot more thought and effort into what it means to get the right person on your team.   This demands greater care in not just defining skills you need, but the fit into your business culture.  You also need to be offering flexibility in job structuring and reporting relationships to meet the expectations of the talent you need.

It is important to remember that today’s talent wants to align personally with their organization’s values, and it is expected that these values permeate your business practices and products.

How to retain talent –

Small or big, in the face of increased competition for a decreasing pool of talent, employers need to focus more than ever on what it takes to secure long-term employees.  Research shows that today’s talent place greater value on their relationships with their employers.  They want to trust you and respect you and, in turn feel valued and respected by you.

If you are used to simply paying for a person to turn up and follow their job protocols, you might well face unexpected demands.   Today’s talent want a workplace where people are feeling good about where they are and what they are doing.    They expect far more sharing of information and opportunities to collaborate.  They are not simply motivated by money, they want to know how they make a difference and expect to experience their workplace as a place to achieve highly individual life goals. Your managers need to be worthy of respect and not expect to lead by decree. They will have to improve their own skills to effectively communicate, motivate and retain skilled workers, or your business will risk losing talent to other employers who are perceived as more progressive and desirable.

How to build your employer brand –

Just as today’s consumers are far more empowered, so are employees.  Large global websites aggregate and facilitate employees’ feedback, stories and ratings of their employers – for all the world to see.  Social media also provide employees with multiple channels to express their views and describe their experiences.  All this talk by employees about their employment experience in your business makes up your employer brand.

To be an employer of choice, businesses need to:

  • have a system to elicit and respond appropriately to employees’ feedback
  • focus on open and relevant communications with employees about the business and about the impact of their own performance
  • take an interest in employees’ life goals and be willing to help them develop skills, even this is not directly related to their current position
  • ensure value-driven, ethical and honest behaviour throughout all levels of the organization
  • provide a clear and compelling vision for the business
  • provide opportunities for work that is interesting and presents employees with challenges that help them grow
  • employ managers and supervisors with talent and abilities that inspire respect and trust

Be prepared that as the future unfolds, it is inevitable that it will become more challenging to attract and retain talent.  Your business is as good as its people, and as it grows however good you are at doing your business becomes less relevant to your success.  It’s time to think about what it would take to become an employer of choice who easily attracts the talent you need, as well as wisely develops and keeps it.  This is a vital part of your competitive edge.

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