Matching Workers to Work

From Staffing.org | 7/22/2010

by David Earle

For some companies the recession may have provided a respite from the issue of worker shortages, but those shortages remain real and persistent as we look to the future. Demographics are immovable obstacles. We know the composition of the U.S. workforce for the next several decades and it suggests a prolonged and challenging period of increasing competition for diminished human capital resources.

2010 Corporate Recruiting Report 

In the U.S. we will be dealing mainly with: a) the shortage of replacement workers for retiring baby boomers; b) a shortage of experienced, mid- and upper-level managers; c) the mismatch between worker skills and work requirements; and d) restrictive immigration policies. We are extremely fortunate in continuing to be a highly developed country that is also a growing labor market, with projected population growth over the next 40 years from roughly 300 million today to roughly 400 million by 2050. As such we are the exception, not the rule. Europe and Japan face similar problems, but theirs are tied to falling birthrates and declining populations.  

The developing countries on the other hand have a reverse problem, that is, no place to absorb the labor surpluses among younger workers.

That fact that workers are migrating to where work opportunity is comes as no surprise. What may surprise, however, is the extent and character of the migration. Movement is occurring on an unprecedented scale, and the primary driver is economic opportunity. 

More than 190 million people today live and work outside their native country, roughly 3% of the world’s population. That population is growing at about 5.7 million per year. To put that in perspective, it’s equal to the sixth largest country in the world, larger than Russia (142 million) or Japan (127 million) and only slightly smaller than Brazil (193 million) or Indonesia (231 million). 

It’s a mistake to assume that extensive migration is confined to unskilled workers desperate to escape poverty and limited prospects. The willingness to move is very much present at all levels of skill and experience. Note that the willingness to move actually increases as education increases (see above chart).

At the other end of the spectrum, data from Spencer Stuart, the headhunting firm, shows that 51% of their executive sample had worked abroad for more than 6 months, and 46% said that international experience and mindset were a key competency for leading today’s enterprise.

People move for many reasons, which tend to vary by skill level. Professionals and skilled technicians move for adventure, advancement, language, skill development, cultural skills, and often for security and quality of life. Lower skilled workers tend to seek areas of economic growth, plentiful jobs and ready income.

Across the 27 countries surveyed by Manpower, the top 10 job categories that employers fill with foreign talent are, in descending order (most to least):

1. Laborers


2. Engineers


3. Production Operators


4. Technicians


5. IT staff


6. Sales Reps


7. Administrative Assistants/PAs


8. Customer Service Reps


9. Senior Executives/Board Members


10. Accounting & Finance staff
     

Mobility has been increasing for decades, driven by steady decreases in the cost of transportation and by advances in communication. Where work is to be had, word now quickly circulates around the globe and workers respond.

Think of this mobility as offering a variety of recruiting opportunties, not just cross-border and not just workers moving to where the work is. Think of it also in terms of placing work where workers will find it most attractive. A good example is the relatively sparse but important (in the U.S.) 25-34 demographic.

As it turns out, this group gravitates to urban living. The U.S. Census Bureau data from 2000 shows they seek in-town living at nearly triple the rate of the general population. In Chicago, for example, a person this age is 1.79 times more likely to live downtown than the general population. 

Couple this with data from marketing consultancy Yankelovich, whose survey found that 65% of respondents in this demographic preferred to: a) find a place they wanted to live; then b) look for a job there, rather than pick the job first, then settle for the location that job entailed. The recruiting implications are obvious. Put your work in a downtown urban area if you want a head start in attracting this critical age group.

Excerpted from the 2010 Corporate Recruiting Report