Like the 800-mile crack in California, infamously dubbed the San Andreas Fault, employers have been hit with a gaping divide between the skills available in the labor market and the qualifications needed to satisfy the needs of their open roles. So, what’s driving this talent shortage? Being successful in our ever-evolving workplace now requires employees to be multifaceted, endowed with the right blend of soft skills, technical prowess, and analytical ability.
For example, if a business development professional performs exceptionally well in client-facing situations, but cannot navigate a CRM or other sales-related software, they won’t be able to bring the level of value needed to succeed in the role. Technological demands and the high expectation level of today’s consumer have driven companies to look for workers who are adaptable, possess a wide range of skills, and are constantly expanding upon their knowledge and strengths.
According to recent research conducted by the Korn Ferry Institute, the global talent shortage could reach nearly 85.2 million people by the year 2030, costing businesses billions in lost economic opportunity. The impact of the employee shortage for America’s financial services sector alone is projected to suffer a $435.69 billion loss in unrealized economic output, which accounts for approximately 1.5% of the entire U.S. economy.
The financial and business services industries are slated to experience the biggest hit, with the talent deficit forecasted to reach nearly 10.7 million workers by 2030. The manufacturing sector will see an estimated 7.9 million in talent shortage followed by the technology, media, and telecommunications industries, with a shortage of 4.3 million workers.
These numbers are staggering. So, how can your company address the growing talent gap? It’s time to be proactive and start preparing a strategy now in order for your business to stay ahead of the curve.
Conduct an Analysis of Skill Need
It goes without saying that labor needs will be incredibly diverse from company to company. As a business leader, it’s essential to perform a skills gap analysis, which will help you catalog the discrepancy between your employees’ existing skills and the desired skill level your organization needs. By conducting an analysis at both the individual and team level, you’ll be able to identify what’s lacking, implement strategies to reduce variations, and begin closing the gap. A skills gap analysis will also help shape your internal training and development programs.
To identify what skills are essential to the goals and success of your business, you’ll need to ask yourself the following questions: What skills do our employees need in order to perform their jobs at an optimal level both now and in the future? What types of skills does our company place the most value in?
Once you’ve formulated a clear vision of what your business requires, you can measure your staff’s existing skills through the use of surveys, assessments, performance reviews, employee interviews, or evaluation software, like Skills DB Pro or TrackStar. After accumulating the data, you can begin minimizing the skills gap by restructuring your internal training programs or executing a new strategic hiring plan for the organization.
Use Upskilling to Bridge the Gap
According to Gallup’s State of the American Workplace report, approximately 51% of adults current employed in the U.S. stated that they are actively on the hunt for a new job opportunity. Why? The lack of growth and development opportunities with their currently employer. Growth can mean a number of things – from learning new skills to cross-departmental collaboration to mentorship programs. Investing in your staff will not only drive retention, but it’ll also increase your bottom line. The data produced from your skills gap analysis will help you determine whether your training program needs a complete overhaul or you simply need to revamp a few key areas.
Begin Building a Pipeline
Career development and upskilling your current workforce is a vital piece of chiseling down the skills gap. Another important way to address your business needs is to proactively build a pipeline of talent. You’ve done your research and analysis, creating your ideal candidate profile, now you can begin building and nurturing a pool of candidates that align with your current and future hiring needs.
Now more than ever, you need to be creative with your recruiting techniques, going beyond traditional channels to source and uncover untapped pools of talent. You may also want to consider including the contingent workforce in your hiring strategy, especially if you require a certain skill set to facilitate an upcoming project.
The Future of Work
As talent management practices continue to evolve, companies must redefine the composition of their employees. With the skills gap only projected to grow, employers must leverage the contingent workforce to bridge talent gaps and use creative recruitment strategies to attract and retain workers. While this certainly won’t be an easy feat for employers, those who start revamping their approach to hiring and career development will be better equipped to handle our evolving labor market.