Contributing Factors to the Talent Shortage
There are a number of factors to be considered when evaluating the talent shortage:
- The retirement of the Baby Boomers, perhaps the most highly educated and affluent generation in the history of the United States. The leading edge of the generation that was born between the years 1946 and 1964 is now hitting retirement age. This segment of the workforce has a large store of knowledge and experience, and often forms the core of senior management teams. As they retire from the workforce, the resulting “brain drain” risk is something that needs to be managed. Finally, to earn additional income in retirement or to simply stay engaged, some Boomers will choose to continue working in some limited capacity.
- Generations X and Y. The generations that follow the Baby Boomers are smaller in quantity, have different values, and also view work very differently. Not only are they the most technology-savvy group of workers, but for them work is a progressive series of project engagements and learning experiences. There is no expectation of a “job for life” nor is there an expectation of a single career.
- Increasing numbers of women in the workforce and more dual-income households are driving greater demands for work/family balance. The result is that many professionals are unable or unwilling to “put in the hours” as in times past.
- Tighter immigration and worker visa restrictions. Many highly educated foreign workers with in-demand skills are now restricted from working in the US. This trend is compounded by the rapidly expanding economies in their home countries which provides them with heretofore unavailable opportunity, and eliminates the need to look elsewhere for work opportunities. This “reverse brain drain” is predicted to have a dramatic effect on the global competitiveness of the United States.
- The United States is quite simply failing to educate enough technical and professional students to meet the market demand. Many of our current engineering and science graduates are foreign nationals who are returning to their homelands instead of staying here as was often the case in times past. In addition, countries like China and India are granting ten times the number of engineering and science degrees than the United States.
- Just as most workers no longer have an expectation of doing the same work for their whole career, most companies no longer expect to employ a worker for the entire career. The lack of job security and the relative lack of loyalty on both sides of the talent equation, have created a more challenging business environment in which to build teams and get work done.
- Local market conditions. For example, the extremely high cost of living in the major metropolitan areas of California (San Francisco Bay Area, Greater Los Angeles, Orange County, San Diego) is a compounding factor to recruiting and retaining the talent local companies need to grow.
In the next post I’ll share some initial thoughts on how we (as employers and employees) should react to this new paradigm.
