Herman Trend Alert: Skills Shortages Worsening

With the forecasts of doom and gloom in so many places around the world, we would expect companies to delay hiring new employees and that the skills shortages 2006-07-20 13-26-13_0031might be lessening. Fortunately for candidates, many companies worldwide are hiring and unfortunately for employers, the shortages of skilled workers are costing companies billions of dollars.

A recent survey of more than 1,000 corporate directors, conducted in partnership with Women Corporate Directors and Heidrick & Struggles, outlined the problems by region and by industry. Moreover a significant majority of board members indicated that their companies are hiring, and not in small numbers, actually in the double-digits and across the globe.

The most active hiring will be in the materials and IT & telecommunications sectors. In these industries, more companies plan to employ workers and to add a higher percentage to their workforces. The two industries least likely to add people are those two that are most affected by uncertainty and regulation—financials and health care.

Geographically, the most active hiring will take place in Australia, New Zealand, and North America.* These findings are aligned with the recently released Manpower report as well.

According to the Conference Board of Canada, “Ontario is losing out on as much as $24.3 billion in economic activity and $3.7 billion in provincial tax revenues annually”. This loss is due to the fact that “employers cannot find people with the skills they need to innovate and grow in today’s economy”.

In Argentina, the story is much the same. According to the Manpower Group, there, 49 percent of employers believe that the skills shortage will adversely affect they business; worldwide the number is 54 percent.

According to this same survey, the largest talent shortages are in Japan (85 percent) followed by Brazil (68 percent). The skills shortages have worsened in Hong Kong (up +22 percent compared with last year), Turkey (+17 percent), Israel (+14 percent), Greece (+14 percent), India (+13 percent), and China (+12 percent).

These talent shortages will have a devastating effect in companies’ ability to generate sales and growth. Wise companies will conduct “stay interviews” with their high potentials, plan to grow their own talent, and have already primed the talent pipeline by working with their local schools and colleges to help prepare the grads they will need now and moving into the future.

* This study did not detail results from The Middle East, Latin America, or Africa, due to low response rates.

Herman Trend Alerts are written by Joyce Gioia, a Strategic Business Futurist, Certified Management Consultant, author, and professional speaker. Archived editions are posted at http://www.hermangroup.com/archive.html 

© Copyright 1998-2013 by The Herman Group of Companies, Inc., all rights reserved. Reproduction for publication is allowed by permission of The Herman Group, Inc., and must include the following attribution: “From ‘The Herman Trend Alert,’ by Joyce Gioia, Strategic Business Futurist. (800) 227-3566 or http://www.hermangroup.com. The Herman Trend Alert is a trademark of The Herman Group of Companies, Inc.

To improve management skills and leadership ability, many companies are providing online supervisory training as part of the solution to the skill shortage situation.