Labor Shortage 4
Colin
Kingsbury is one of my favorite thinkers in the industry. Willing to
invest his considerable intellectual resources into the industry's
ongoing conversation, Colin keeps the edge of the discussion razor
sharp. Recently, he vented his inner Doberman:
This
line of thought was provoked by
John Sumser's Labor Shortage 3
article, which casually lobs
this assertion over the wall as
if the author was stating a law
of physics:
(Read More)
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Research and Markets (http://www.researchandmarkets.com/reports/c65955) has announced the addition of "The Irish Employee Recruitment Handbook - Finding and Keeping a High Quality Workforce" to their offering.
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You Should Know: Germany: The Cane Mutiny - Managing a Graying Workforce
Human resources manager Frank Heberer frowned. The internal-mail envelope he'd just torn open with great expectations contained the report he'd labored over for months. It outlined the long-term human resources strategy he believed Medignostics needed to adopt in order to remain competitive in the next 20 years. On the title page was affixed a yellow Post-it, with the words "Not a priority" penned in the ornate handwriting of Erwin Baum, the vice president of HR. Noting the crispness of the binder, Heberer doubted that anyone had read beyond his cover sheet.
He felt completely deflated. For the past six months, this had been his pet project. He'd
done all the research, and everything he'd read pointed to a rocky road ahead. The average age of the German population was steadily rising, and that had real implications for the midsize pharmaceutical company's personnel. He flipped open his report to look once again at the shocking statistic: Without immigration, the country's population would fall from 82 million to 24 million by 2100. "Granted, that's a long way off," he thought, "but what could be a bigger priority than a disaster you clearly see coming?"
governancefocus.blogspot.com
Alaska: Fried says tide is changing in public, private workforce sectors
Alaska's public sector — including federal and state entities, local governments and the military — currently employs 26 percent of the state's workforce, while small businesses account for more than 50 percent of workers.
But the tide is changing. With new hospitals and retail chains opening up, and increased activity in the oil industry, more Alaskans are working for large private-sector employers.
And that tide is ever-changing, and often unpredictable, says state labor economist Neal Fried, who specializes in research on employment and earnings in the Anchorage area and Matanuska Valley.
Oil and gas
Thinking of economic trends in the 49th state, especially over the past 30 years, the oil and gas industries readily spring to mind. Indeed, the natural resources industry makes up a whopping 13 percent of Alaska's total employment, as much as the leisure/hospitality and construction industries combined.
And the oil industry continued to dominate the top 100 largest private employers in Alaska in 2006, Fried noted in the July/August issue of Alaska Economic Trends, a publication of the Alaska Department of Labor and Workforce Development.
Some 88 percent of all oil industry workers are employed by one of the state's 100 largest employers, and 10 of the 11 top 100 oil industry employers increased their work force in 2006.
Udelhoven Oilfield System Services and Nabors Alaska Drilling both improved their rankings more than 10 places from the previous year.
Crowley Marine came in at No. 73 in 2006, up 26 places from 2005, the most dramatic jump in ranking by any one company. Two years ago, Crowley acquired the assets of Northland Fuel LLC, which included Yukon Fuel Co., Northland Vessel Leasing and Service Oil and Gas Inc.
Fried predicts the oil industry will continue to be a top contender, at least over the course of the next few years.
"In the last year and a half, we've seen a real increase in activity in the oil sector," he said. "But you never really know what's going to happen, since the industry waxes and wanes."
Health care
Providence Health System, a nonprofit organization, was the state's largest employer in 2006, with 3,991 employees. Providence debuted as the top employer in 2001, with 3,369 employees. As early as next year, it could be the first private-sector employer with an average monthly workforce that exceeds 4,000, Fried said.
Growth in the heath care industry will remain steady but slow over the next few years, he said. "Health care steadily marches on, but it's not the contender it once was."
According to Alaska Economic Trends, Alaska had more nonprofits per capita in 2005 than any other state. In Alaska, more than 6,000 nonprofit organizations employ more than 30,000 people. Almost a quarter of the top 100 companies are nonprofits. Providence Health System, Yukon-Kuskokwim Health Corp., Banner Health, Alaska Native Tribal Health Consortium and Southcentral Foundation were the biggest nonprofits in 2006. All five companies ranked in the top 20 overall.
Retail
Fried expects to see significant growth in the retail industry over the next five years. "Retail came into its own in the early Ô90s, so we saw dramatic growth from 1990 to 2000. It hasn't been as dramatic over the past few years, but I predict that will change in 2008, 2009 and beyond," he said.
Wal-Mart/Sam's Club was ranked No. 4 overall among employers, but the company lost workers over the last year. "That really surprised me," said Fried. "Wal-Mart is expanding their Eagle River and Mat-Su stores, opening a store in Juneau and they have new plans for Anchorage. It's interesting that a company that has grown so much and may one day compete for the top spot on the list actually lost employees."
He predicts Wal-Mart's downward trend will not last: "I think it's just a lull before strong growth."
Fried foresees Target making its debut on the list in 2008.
"It's unusual to have a company not on the list one year and solidly on the list the next, as I suspect will be the case with Target," he said. Retail clothing chains, such as Gap Inc., may eventually make the list as they continue to open stores across the state.
The top 100 private-sector employers list is made up of both well-known and not-so-well-known companies.
"Yukon-Kuskokwim Health Corp. ranked 13th overall, but hardly anyone's heard of them, Fried said. "It's the same way with ARAMARK - you don't see their sign up all over town. But then we have Providence, Carrs/Safeway, McDonald's - places like that."
More than 20 percent of Alaska's Trends 100 employers show up in Fortune magazine's annual list of the nation's largest companies.
"From year to year, economic trends tend not to be too dramatic," said Fried. "What's interesting is seeing who the new players are."
New companies make the list for a variety of reasons. Some have experienced steady or dramatic growth, some have merged with other companies and some have simply changed their name.
"It's always interesting," said Fried, "to see who makes the list every year. It's very unpredictable. You just never know."
According to recent press, the West Australian Government is 78 teachers short of staffing targets leaving schoolchildren with no teachers to attend them. A reactive campaign to bring some of the 8,000 registered teachers back into the classroom has now started. As Australian Baby Boomers retire over the next few years, acute shortages of the most highly skilled and valuable workers will become more prevalent. PeopleStreme Human Capital has developed Workforce Planning Software to fill the gap left by organisations who have focussed mainly on benchmarking and high level measures to assess future workforce needs.
In the Health sector, the Australian Government's 'Districts of Workforce Shortage' is aligned with State and Territory Governments 'Area of Need' or 'Unmet Area of Need' in order to deal with a lack of suitably qualified medical staff. "Rather than scrambling to refill positions once the person has actually left the organisation, pro-active planning means that successors can be trained or recruited with more than just a few weeks notice" said Lyle Potgieter, CEO of PeopleStreme Human Capital. In managing the workforce shortage the Government still uses a high level approach described as "a doctor to population ratio based on recent Medicare billing statistics".
Visibility of Australian workforce shortages has significantly increased in recent months as the Victorian State Government posts the Small Business Victoria Newsletter to Victorian households. The Newsletter quotes a 2005 Workforce Tomorrow Report saying "by 2012 a national shortfall of 195,000 workers is predicted".
The trend is expected to become worse as Baby Boomers retire over the next few years. Workers in many Government Departments already have an average age much higher than the majority of the Australian workforce. In fact, a search of "ageing workforce" at the Australian Bureau of Statistics website reveals an impressive array of high level reports on this problem.
What is Wrong with the Traditional Workforce Planning Approach ?
Despite the known shortages in workforces across Australia, organisations are still having trouble dealing with the issue. Many organisations have conducted high level Workforce Planning and benchmarking. They know that their workforce is ageing according to their own high level reporting but struggle beyond the point of acknowledgment that this is happening. The most basic planning technique is to collate statistics on the workforce, such as age, length of service and other demographics. However, the workforce plan usually stops at a high level forecast of shortages and an acknowledgement that a problem really exists.
Fortunately new Workforce Planning technology is available to overcome this lack of planning detail. Workforce planners can now get visibility on the retirement intentions of each and every employee. Shortages of key staff often result in very lengthy replacement times. Even more time is needed for the new employee to become as proficient in the role as the retiree. Without advance notice, key roles are remaining vacant, resulting in service delivery issues affecting many organisations. In addition to retirement data, new Workforce Planning technology can assess the current - not historical - statistical probability that an individual will resign from an organisation. This means that vacancies created by retirement and other resignations of the most skilled workers can be pro-actively managed.
Detractors might suggest that privacy implications prevent effective identification of the most at-risk employees. This is a naive view given that managers must have strong visibility of their team's growth path or retirement plan, as the case may be, in order to manage their own outcomes and resources effectively.
"The problem of workforce planning for an ageing workforce is usually delegated to the HR department but really belongs with each manager and supervisor." said Potgieter. It is the managers and supervisors who are struggling with the consequences of accelerated retirements and who usually have to deal with problems such as:
1. Breaking continuity of service
2. Reputation impact for the organisation
3. Much higher cost to replace key workers resulting from a reactive approach
4. Program and project breakdowns resulting from a loss of organisational knowledge and experience
According to Potgieter, "Workforce Planning is not just a matter of collating demographics and acknowledging a problem. Rather it is a process of working actively with managers to define a strategy in each department where there is a known workforce shortage." Managers and supervisors deal with ageing workers in their teams every single day. It is a small step to determine which aged workers are considering a retirement and when they will leave.
Existing workforce planning techniques are very high level. For example, it's not unusual to hear something like "Based on last years numbers and economic conditions, we will be short of 89 teachers (or doctors or town-planners) in 2008." Being pro-active means that organisations need to go further than this and define which schools, which departments and which individuals. This helps improve visibility on staff replacement priorities and also with the development of plans for retaining talented employees whilst replacements are found. This is the part most organisations struggle with. Few organisations have visibility on individual employee intentions and, therefore, the business can only react after the resignation or retirement event.
Manager and Supervisor participation is critical in this process because they a) Feel the Pain of retirements in their own team and b) are best positioned to pro-actively plan for replacement workers by asking current team members when they intend to retire. But managers and supervisors need tools such as PreopleStreme's Workforce Planning module, to help them report and collate retirement information about individual team members. This makes the process easier for supervisors and managers and also provides the organisation with a top-down view of retirement hot-spots throughout the workforce. i.e. what has to be done first and what areas can wait.
As with water shortages, the impact of an ageing population can no longer be ignored. Once organisations start having delivery issues, there has to be urgent action. The economy has reached the point that unfilled positions are growing fast and organisations are experiencing service delivery issues. The time for action has arrived. Detailed workforce planning that is granular and specific will provide proper visibility and help manage the issue, whilst gross high level benchmarking will not.
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