Workforce and hiring trends amd demographics
<This article was first published by the Herald-Tribune on June 27, 2016>
According to NBC News, 2.7 million jobs were lost to China in the decade between 2001 and 2011. Many of these lost jobs, an estimated 2.1 million, (77 percent) were in the textile industry. More than 1 million jobs (37 percent) were in the computer and electronic product category. China and the United States are the two largest manufacturing economies in the world.
Do we blame China because they have lower labor costs? Are these jobs likely to come back anytime soon, or ever?
Job sectors and cities
According to an Economic Policy Institute study by Robert Schott, about 50,000 manufacturing facilities in the United States have been shuttered since 2001. “Very few are coming back anytime soon.” New Hampshire lost the most jobs (2.94 percent), followed by California, Massachusetts, Oregon, North Carolina, Minnesota, Idaho, Vermont, Colorado and Texas.
In the decade from 2010 to 2020, the United States is expected to add 20 million new jobs. Certain medical and personal-care jobs will make up over 50 percent as the baby boomer generation swells.
The website 24/7 Wall St. lists the top 10 American cities adding the most jobs as an increase of the number of people employed there. They are: 10 – Lafayette, Louisiana, 8.5 percent; 9 – Naples-Marco Island, 8.6 percent; 8 – Elkhart-Goshen, Indiana, 8.9 percent; 7 – Holland-Grand Haven, Michigan, 9 percent; 6 1 – Laredo, Texas, 9 percent; 5 – Blacksburg-Christiansburg-Radford, Virginia, 9.9 percent; 4 – Gainesville, Georgia, 10.6 percent; 3 – Midland, Texas, 11.2 percent; 2 – Columbus, Indiana, 14.5 percent; and 1 – Odessa, Texas, 18.4 percent.
With college students struggling to find work, what are the most promising sectors for jobs in the near future?
Here they are, according to 24/7 Wall St., expressed as a percent of 2010 employment, followed by the median annual wage: 1 – actuaries, 87.1 percent, $87,650; 2 – glaziers, 79.7 percent, $36,640; 3 – statisticians, 74.5 percent, $72.830; 4 – pest control workers, 70.9 percent, $30,340; 5 – interpreters and translators, 69 percent, $43,300; 6 – optometrists, 68.4 percent, $94,990; 7 – natural science managers, 68 percent, $116,020; 8 – market research analysts and marketing specialists, 67.8 percent, $60,570; 9 – insulation workers, 67.5 percent, $35,110; and 10 – environmental science and protection technicians, including health, 65.9 percen, $41,380.
I posed this question at helpareporter.com: “Is it possible to bring back the jobs and do they still exist?”
Dileep Rao, a clinical professor at Stanford and Florida International University who also is with InterFinance Corp., says. “We need to focus on growing entrepreneurs, not small business, not Fortune 1000 companies and not venture capital. Make trade agreements more balanced so that we can export as much to a country as they export to us.”
Samuel Rines, a senior economist and portfolio strategist with Avalon Advisors, said, “Some manufacturing may return to the United States. Automation, including robotics, is allowing the U.S. to become increasingly competitive in manufacturing, but with fewer and different jobs. However, labor-intensive manufacturing is far more likely to move to Mexico than the U.S. The jobs that return are not the same as the ones that left.”
Ira Wolfe, president of Success Performance Solutions, writes about workforce trends. “Any job that can be automated will be. With enormous improvements in artificial intelligence, service and professional jobs are also at risk. It’s estimated that nearly 75 percent of all current jobs are at significant risk to become extinct or dramatically altered within the next 10 to 15 years.
“Bringing jobs back that meet the current skill level of the majority of employees only lowers the bar for productivity. Without gains in productivity, our economic drivers and global competitiveness stall. Technology structurally disrupts labor markets. We’ve not experienced structural disruption like this since the Industrial Age. New technology kills old jobs and creates new ones. What we really need are better jobs. But those jobs require different skills.
Wolfe adds, “The solution is better education and skill training. The political response has been to pour more money into old programs and expect a different result. Meeting business demands requires a different delivery system and business model. We know that our education system needs help. Attempting to train a laborer to become a health care provider seems to make sense but, to date, this has been largely unsuccessful.
“It’s not an easy fix,” Wolfe says. “Rhetoric won’t solve the jobs crisis. It just gets politicians re-elected.”
“From a macroeconomic standpoint, we might be trading a small number of jobs for much higher pricing for all Americans on many goods and services,” suggests Alex Zapesochny, president and CEO of iCardiac Technologies Inc.
Gary Patterson, of Fiscal Doctor Inc., said he believes, “It is possible to bring the jobs back if and when the U.S. has the political guts to bring a value added tax like other countries use. With a level playing field, U.S. manufacturing would be more competitive.”
“Jobs won’t come back unless domestic factors change,” says David Tal, president of Quantumrun.com. “These factors may include ending or rewriting existing free trade agreements or investing in enough automation technology that will make domestic manufacturing once again more economical than outsourcing.”
For me, what really matters most is the ability for you, and perhaps recent graduates in your family, to stay gainfully employed in meaningful, well-paying careers that fulfill dreams and aspirations. If that is combined with an entrepreneurial spirit that helps create jobs, so much the better.
Dennis Zink is a volunteer, certified mentor and chapter board chairman of Manasota SCORE and chairman of Realize Bradenton. He is the creator and host of Been There, Done That! with Dennis Zink, a nationally syndicated business podcast series. He facilitates a CEO roundtable for the Manatee Chamber of Commerce, created a MeetUp group, Success Strategies for Business Owners and is a business consultant. Email him firstname.lastname@example.org.
As much as things change, some things remain the same. That is certainly the case when it comes to recruiting new talent. Word of mouth has been and still is the best source.
In a recent survey by LinkedIn, nearly one quarter of employees who were recently hired at a small or mid-sized business heard about the job through someone they know at the company. Only 1 in 7 found the job through a third-party website or online job board and nearly the same number used a staffing firm.
Of course, many small business employers dismiss social media as a distraction and nuisance. It’s time to get over it and recognize it as a powerful marketing and engagement tool for customers and employees alike. Social media after all is just word-of-mouth on steroids!
But finding out about a job opening is only a first step. Nearly half the participants in the LinkedIn study didn’t know anything about the company when they first heard about the job. So what do they do?
They “Google” it, of course. Two-thirds immediately look up the company’s website. And over one-third read about the company online. After that, many just swipe left (aka delete). A company website is often the first impression and many companies fail miserably.
For starters, many company websites are not mobile optimized or responsive. That’s an immediate turnoff. And when a company has revamped their sites, much more attention was given to the external customer interface than recruitment.
A potential customer gets to interact with products and services, watch videos, read customer reviews, and chat live with “one of our friendly agents.” A potential employee is offered a boring job description and the opportunity to fill out a non-mobile friendly 5-page application or download a pdf which they can fax back or mail. The closest many applicants get to human contact with a recruiter or HR is an email which disappears in the infamous Human Resources black hole. Even when a company website allows a candidate to complete an application online or upload a resume, most applicants get the silent treatment, a “non-event” I like to call “ghosting.”
To reach and engage enough qualified talent, here are 3 recruiting strategies you can apply.
The poor results gleaned from most recruitment efforts don’t have much to do with strategy, planning, or budget. The problem is that today’s top talent is more interested in the company than the job and paycheck itself.
Maybe it’s time that management takes a similar interest in the future success of the company and stops looking at jobs as openings filled with bodies. Jobs don’t care about company culture, purpose, or meaning. People do. Jobs don’t energize or vitalize a company. Employees do. Instead of filling jobs, it’s time management focus on treating talent as the capital asset it is and stop treating employees like you’re doing them a favor.
The Exponential Age: That’s what Udo Gollub calls life as we now know it. He begins a recent article with this:
In 1998, Kodak had 170,000 employees and sold 85% of all photo paper worldwide. Within just a few years, their business model disappeared and they went bankrupt.
What happened to Kodak will happen in a lot of industries in the next 10 years – and most people don’t see it coming. Did you think in 1998 that 3 years later you would never take pictures on paper film again? Surprisingly digital cameras were invented in 1975. It was a disappointment for a long time and written off as fantasy…until it wasn’t. And then a fixture of American innovation and business crumbled. Why didn’t they see it coming? Do you view the future through the same lens as Kodak?
The same thing is happening with artificial intelligence, autonomous and electric cars, education, 3D printing, agriculture and even jobs. But this time structural changes won’t take centuries or decades to complete. The technological change of the next 10 years will have the same impact as the Industrial Revolution did in the 19th century. But instead of 100 years, it will happen in only 10 years.
Leading the disruption is software. Uber is just a software tool, they don’t own any cars, and are now the biggest taxi company in the world. Airbnb is now the biggest hotel company in the world, although they don’t own any properties. What software might rock your industry, your business model, your job?
Will it be artificial intelligence?
Watson already helps physicians and nurses diagnose cancer, 4 times more accurate than humans. Facebook has pattern recognition software that can recognize faces better than humans. In the US, young lawyers already don’t get jobs. Because of IBM Watson, you can get basic legal advice within seconds, with 90% accuracy compared with 70% accuracy when done by humans.
How about autonomous cars?
In 2018 the first self-driving cars will appear for the public. You will call a car with your phone. It will show up at your location and drive you to your destination. You will only pay for the driven distance and can be productive while driving. Think taxi without a driver! You won’t want or need to own a car anymore. As traditional car companies try the evolutionary approach and just build a better car, tech companies (Tesla, Apple, Google, etc.) take a revolutionary approach and build a computer on wheels.
It’s not just the automobile companies that will be affected. Self-driving trucks will solve the problem they have with finding enough qualified drivers. But they will also detach nearly 9 million truck drivers from their current jobs. Insurance companies too will have massive trouble because, without accidents, insurance will become 100 times cheaper. The current car insurance business model will disappear.
Even real estate will change. If you can work while you commute, people will have more options and may move further away to live in a more affordable community.
3D Printing? The space station now has a printer that eliminates the need for the large amount of spare parts they used to have in the past.The price of the cheapest 3D printer came down from $18,000 to $400 within 10 years. In the same time, it became 100 times faster. Spare airplane parts are already 3D printed in remote airports. All major shoe companies started 3D printing shoes. At the end of this year, new smartphones will have 3D scanning possibilities. You can then 3D scan your feet and print your perfect shoe at home. By 2027, 10% of everything that’s being produced will be 3D printed.
Longevity? Right now, the average lifespan increases by 3 months per year. Four years ago, the life span used to be 79 years. Today it’s 80 years. By 2036, there will be more than a one-year increase per year and 100 years old will bethe new 60!
Education? By 2020, 70% of all humans will own a smartphone. The cheapest smartphones are already at $10 in Africa and Asia. Every child in the world can use Khan Academy to access everything a child learns at school in First World countries. That means everyone will soon have the same access to world class education regardless of socioeconomic status or geography. What will this do the traditional classroom model from elementary school to universities?
Whatever the industry you’re in or the goods or service you use or produce, here’s a simple rule: if it doesn’t work with a phone, your business and business model may be history. Gollub (along with a lot of very smart people) agree that “almost any idea designed for success in the 20th century is doomed to fail inthe 21st century.”
Will they be right? Or are you still betting on your past and feel time is on your side?
And last but not least. Here’s an app that can’t come soon enough. By 2020, there will be apps that can tell by your facial expressions if you are lying. Imagine a political debate where its results are displayed while the candidates are talking.
To read the full article by Gollub, click here.
1. There have been job gains at the highest paid level — engineering, finance, computer analysis; and there have been job gains at the lowest paid level — personal health care, retail, and food preparation.
Source: Federal Reserve Bank
2. The jobs that kept the middle class out of poverty — education, construction, social services, transportation, administration — have seen a decline since the recession, especially in the northeast. At a national level jobs gained are paying 23 percent less than jobs lost.
Source: Federal Reserve Bank
3. The lowest paid workers, those in housekeeping and home health care and food service, have seen their wages drop 6 to 8 percent (although wages overall rose about 2 percent in 2014).
Source: Federal Reserve Bank
4. By 2018, 63 percent of all jobs will require some kind of post-secondary education and training. Including both new job openings and the replacement of retirees, high skills jobs will represent 33 percent of job openings, low skills jobs 22 percent and middle skills jobs 45 percent through 2014.2 This means roughly 78 percent of all available jobs will require education beyond high school. These projections of high, middle and low skills jobs are fairly consistent across all states.
Source: Brookings Institute
5. Forty-five percent of individuals with some college and 45 percent of individuals with associate degrees (those most likely to be employed in middle skills jobs) were in the middle income classes in 2007. » More than 85 percent of the nearly 73 million individuals who earned minimum wage or less in 2010 did not have a postsecondary degree — and nearly 60 percent had only a high school diploma or less.
Source: Brookings Institute
6. While a total of 21 million jobs are needed to put Americans back to work at prerecession rates, six sectors (health care, business, leisure and hospitality, construction, manufacturing, and retail) are projected to contribute to the majority of the growth.
Source: Brookings Institute
7. Every 1,000 American women between the ages of 15-44 delivered 122.7 births in 1957. The rate was just 62.9 births per 1,000 women in 2014
Source: Census Bureau
8. More than 1 in 3 American workers today are Millennials (adults ages 19 to 35 in 2016). In 2015 they surpassed Generation X to become the largest share of the American workforce. The youngest Baby Boomer is now 52 years old!
Source: Pew Research Center
9.During the next year, 1 in 4 Millennials will quit his or her current employer to join a new organization or do something different. That figure increases to 44% if the time frame is extended to 2 years.
Source: Deloitte Millennial Survey
To read about 9 more trends, click here.
R.I.P. to the the way it was. An epic shift is underway. From social media to the Internet of Things, digital fabrication to robotics, virtual reality to synthetic biology, new technologies are rewriting the playbook for managing people and leading organizations. Is your business future proof?
For some this shift is the light at the end of the tunnel following years of anticipation. Hope and opportunity await.
For others it’s the feared smack-down as the oncoming locomotive’s light accelerates toward them. Today is the future that was forecast for decades, but ignored in the hope these predictions were just were just hype and hot air. Time has run out. Reality is ready to crush those clinging to the status quo and reward those who see possibilities.
I’ve been tracking this shift for nearly two decades, beginning with my forecast of The Perfect Labor Storm as early as 1999. Few surprises revealed themselves other than a Great Recession and unprecedented acceleration in technology that only disrupted the traditional ways we work and live faster and deeper. For employers and employees alike, this convergence of globalization, demographics, and technology isn’t just transforming fundamental employer-employee relationships. It’s blowing them up.
There is no going back.
We live in a world with changing labor markets, changing workforce, and even changes in the very nature of work. Events are unfolding in plain sight. The default presumption that employers offer jobs that are long-term, full-time, and on-site with longitudinal career paths are history. Employment relationships will be increasingly short-term, transactional, and variable.
Anything can become obsolete at any time.
The pace of technological advances and disruption is unprecedented…and it’s just not in computing. Every aspect of our lives and business can be impacted without notice. Think communication, transportation, entertainment, medicine, education. Companies continually restructure, reengineer, downsize, merge or acquire. Everything and everyone is vulnerable. Who ever imagined that venerable institutions including governments could run out of money?
Loyalty – Part 1
Continual employment is dead. Job security is history. Responding to both disruptions and possibilities, organizations eliminate jobs regardless of employees’ length of service. They implement technology to replace jobs. They hire fewer full-time employees and more contingent workers. Employers will work hard to optimize human resources: having the right people in the right place at the right time, moving away from offering long-term stable employment and toward a more efficient supply-chain management approach.
Loyalty – Part 2
The free agent mindset rules. Without credible long-term promises and job security from employers, employees are learning to live one day at a time. Free agency is no longer a stigma – it’s a career strategy. Baby Boomers seek free-agency as they expect to be active and work long after traditional retirement. Millennials and Generation Z have never known the world any other way. Employees are not dumb, deaf, and blind. Not only do most employees worry about wages and benefits but they live under a veil of uncertainty their jobs will be automated or eliminated. They see how susceptible their organization is to uncontrollable events – from global economics to terrorism. They worry if their company’s management is resilient and smart enough to compete in the marketplace. And to put the final nail in the traditional employment coffin, turnover is increasing among supervisors and managers. Thanks to better job opportunities and the rising tide of Baby Boomer retirements, the loss of direct supervisors has a subtle but profound impact on productivity and retention. These supervisors are the people within the company who know employees best. Without them, anxiety skyrockets and ties to the organization are cut.
These are just a few of the factors creating this epic shift. How will they affect your company?
Managing people will only get harder.
It’s always been hard to manage people. There have always been people of all types and generations working side by side in the workplace. But today there are as many as six generations. Generational gaps merely skim the surface of how different the workforce is and will be. Diversity, gender equality, sexual preference, and skill gaps exponentially increase the number of issues confronting managers every day, not to mention run-of-the mill interpersonal differences. It’s like the potential for disruption has been injected with steroids. It’s no wonder that people management has become a thriving and growing industry!
Beware the “youth bubble.”
Millennials and Generation Z are bringing a whole new set of expectations and behavior.Organizations that rely on young workers will face the challenge of an increasingly high-maintenance workforce. Compensation, benefits, work schedules, work conditions, rewards and recognition are still offered like it’s the Baby Boomer generation that is in control. What worked in the full-time, on-site, job secure past will surely fall short in the new normal of uncertainty and change.
Churn and squeeze.
With fewer long-term traditional employees, a revolving door will become the norm. Best practice metrics of retention and employee turnover will become irrelevant…or at least be used in a different context. Every person from the senior executive to the warehouse worker will be squeezed to produce more work faster with fewer resources. To maximize efficiency and productivity, organizations will have to staff-up (and down quickly) while acquiring a higher quality worker. In addition to figuring out what full-time and part-time classifications mean, management will need to deal with managing more telecommuters and free agent workers as well as consultants and other contingent-type employees. Employers will need to be nimble, flexible, fluid, and smart in how they recruit, hire, and manage employees.
To remain competitive, companies must recruit faster, hire smarter, and manage better. The ability to get the right people on board, up to speed, and delivering results quickly will be the key.
So I’ll ask the question again – is your business future-proof?
If you can believe what you read, the Millennials may not be left with a world that is better than the world Baby Boomers inherited. But that conclusion is not a given. It will take a few more decades sort things out.
What we do know for sure right now is that life is different for Millennial women than it was for Baby Boomers when they were the same age. What a better place to start than what it was like to go to work in the 1950s compared to the present day.
Millennials females, especially in the U.S., have a world of opportunity that just didn’t exist in 1950. Few female Millennials could imagine being turned down when they tried to open a bank account because they are single or required to get a husband to cosign a loan in order to start a new business. (And boyfriends and partners don’t count because it was illegal in most states for unmarried couples to cohabitate!) And let’s not ignore the ability for an employer to fire you on the grounds you were pregnant…and the woman had no recourse.
For an aging Boomer like me it’s particularly disturbing and even embarrassing to admit these situations even existed in my lifetime. But they did and it’s an important reminder that despite the challenges that exist today, the world may still be a better place even though it is far from perfect.
To get this party started, let’s compare a day-in-the-office in 1955 and 2015.
Joe and Sue Arrive at Work
1955 – Joe arrives at the office in his suit and tie, carrying his leather monogrammed brief case. He heads right for his private office where his secretary Sue is waiting patiently. Sue arrived a few minutes earlier dressed in her conservative colored dress or suit wearing high heels. As soon as Sue arrived at her desk outside Joe’s office, she rushed off to get him his first cup of coffee before he arrived. When Joe arrives, she greets Joe with a “Good morning, Mr.Boss” then exits his office to empty his ashtray filled with cigarette butts. She returns in a minute with a clean ashtray to start his day and hangs his dry cleaning that she picked up for him. She then pulls out her stenographer’s pad, pulls up a chair, and begins taking notes.
2015 – Joe arrives in his tee shirt and jeans carrying a back pack and bike helmet. Sue arrives in skin-tight jeans and a top showing some cleavage, revealing the small tattoo on her right breast. Both are carrying cups of Starbucks coffee…and a bottle of water. Sue and Joe grab seats in the “bullpen” with all the other associates. After giving each other a morning hug and fist-pump, both Sue and Joe head off to the lunch area and pop in a K-cup to refill their coffee cups. (Did I forget to mention that Sue is now the CEO and Joe works in sales?)
While life for Sue and Joe is representative of many workplaces it is definitely not universal. So allow me to highlight a few more scenarios that are distant but real memories for Baby Boomers and things Millennials may take for granted.
Before anyone dislocates his shoulder patting himself on the back for all this “progress,” take a deep breath. New laws and regulations have done a lot to improve equality, but we still have a long way to go. Women in the C-level are still the exception and gender wage gaps prevail. The good old boy network still exists and many still believe the ideal role of a woman is to be barefoot and pregnant. It is however helpful to reinforce with Millennials how much gender equality has improved and to remind Baby Boomers how much more work needs to be done.
Published in the November 9, 2015 issue of Lehigh Valley Business Journal
What you hear (and maybe even believe) about millennials is not always true.
That was the gist of my keynote at the Greater Lehigh Valley Chamber of Commerce Manufacturers’ Summit VIII on the morning of Oct. 28 and attended by more than 80 business and workforce leaders. The theme was, “Is it true what they say about millennials?”
The message was reinforced when six father-son panelists discussed how they deal with generational differences in their respective businesses.
Younger workers, however, thought it was cool that someone 3-D printed a model of the “save” icon.
The point is that few workers under 25 have ever used, let alone seen, a floppy disk (or 8-track or 45 rpm record, for that matter), but most workers over 35 assume everyone has.
NOT BAD, JUST DIFFERENT
Millennials, to be sure, are different. But that’s not good or bad.
The members of every generation are different from their parents’ generation for a simple reason. They were born and grew up in a different time and place. They have different memories, different influences and different historical moments.
Baby boomers grew up crawling under school desks to protect themselves in case the Russians attacked. Today, millennial (and Generation Z) students experience lockdowns when a classmate brings an automatic weapon to school.
Different times change how each of us view the world. That’s just life. It’s not bad. It’s just different.
The consensus of the presenters and audience was that generations are more similar than different.
Each generation has extroverts and introverts. They have some people with great work ethic and others whose best skills are negativity and bad attitude. Each cohort has leaders and followers, superstars and slackers.
BEYOND THE FIRST IMPRESSION
I fell back on a trusty tool – the DISC assessment. (DISC is a behavior assessment tool that centers on four traits: dominance, influence, steadiness and compliance.)
The root of many conflicts has more to do with “how” someone might interact with others or approach work, and little to do with intentions. It’s the introvert who seems aloof but really is just observing or thinking.
The same goes for the extrovert who thrives by talking things out but is perceived as a blowhard.
But once you get to know the person, you realize how sometimes first impressions don’t paint a true picture.
GET THEM TALKING
With tools such as DISC, workers from different generations may begin to recognize that many styles and values cross generational boundaries. In fact, boundaries blur and similarities open doors.
DISC doesn’t solve all problems, but without getting different generations talking with each other, generational gaps will only widen.
Much to my surprise, two of the companies on the panel confirmed they were already using DISC to help bring their multigenerational workforces closer.
HOW THEY GOT THERE
Throughout the hour-long summit, several themes kept coming up from baby boomer fathers and millennial sons. These sentiments were echoed by the audience and moderator, a millennial recruiter from Crayola.
The three businesses at the summit attributed part of their success and low-employee turnover, even among millennials, to a few reasons:
(1) They all manage a flat organization with little hierarchy. They give young and old workers a “seat at the table.”
(2) They all have a story to share, and their employees are an integral part of it. (You can tell by their passion and enthusiasm that “people are our most important asset” isn’t just a set of words but a way of life for them.)
(3) Purpose and community involvement of the business and their employees are drivers for growth and high retention.
(4) They became more flexible with time, creating collaborative workspaces, allowing telecommuting, adapting benefits and rewarding an “intrapreneurial” spirit of workers.
(5) They focus on similarities and value differences between generations.
SIMILARITIES TRUMP DIFFERENCES
I closed my address with the following: “Millennials didn’t create the environment that they live in. [Baby boomers and older Gen X parents] did. They grew up in our world. Don’t make millennials scapegoats for how they were educated, how they work and how they play because we shaped their lives.”
But my favorite quote of the morning was by Bill Hindle, president of Easton-based HindlePower Inc. His words epitomized the attitude about how his company, like the others, exudes success and leadership especially when dealing with millennials and the multigenerational workforce.
“Tattoos don’t tell the character of the person,” he said.
Millennials’ attitudes are not poles apart like the media and many consultants want you to believe. For sure, there are differences, but similarities between individuals trump the different world-views that arise from growing up in different times.
Ira S. Wolfe is president of Lehigh Valley-based Success Performance Solutions and author of “Recruiting in the Age of Googlization” and “Geeks, Geezers and Googlization.” He can be reached at email@example.com or 484-373-4300.
For years employers have complained that our education systems were not preparing students to meet the demands and expectations of employers. Only 28 percent of recent college graduates were rated as excellent by employers in the area of critical thinking skills (and a disturbing 0 percent rating for high school grads). This comes at a time where critical thinking, complex problem solving, and judgment were the top 3 skills in demand for 9 out of 10 top jobs.
As a first step a few organizations are beginning to make a statement. They have scrapped academic accomplishment in exchange for skill-based criteria as a minimum hiring requirement.
Ernst and Young, one of the largest recruiters of college grads, “found no evidence to conclude that previous success in higher education correlated with future success in subsequent professional qualifications undertaken.” Even earlier PricewaterhouseCoopers (PwC) adopted a similar stance. Since many employers seem to follow the lead of both of these highly respected organizations, other organizations are likely to follow.
The bottom line is that employers need competent talent. They need to be certain that new hires can compete in today’s volatile, uncertain, and ever-changing workplace. Many are finally doing what it takes to acquire it, even if that means discarding several sacred cows of employee selection, including minimum education requirements.
How dire is the situation?
Edward Gordon, a respected thought leader and author of several books on the employment skills crisis, recently wrote in his newsletter that the
“mismatch between [job skills required and preparedness of workers] has been building for more than 20 years. It is a structural and systemic economic issue directly related to obsolescent education-to-employment systems at the regional and national levels and the failure of businesses to provide training to new and incumbent workers.”
“It has become very apparent that partial reforms, piecemeal plans, and concession to the status-quo have placed much of the current and future workforce in jeopardy…defending an outdated workforce preparation system designed for a less-demanding 20th-century labor market. That era has disappeared.
Does this mean college education is not important?
Hardly. Don’t even think for a moment that a college education doesn’t help develop skills such as time management, commitment, and the ability to prioritize. It also provides an ample foundation of functional skills in areas of language, finance, science. But as far as employers trusting that a college degree implies adequate preparation for decision making and problem solving – forget about it. And as far as securing a good paying job with any assurance of employability 5 to 10 years from now, high school diploma only jobs are surely headed for extinction.
Schools and universities must start delivering graduates with workforce ready skills. If they don’t respond quickly, candidates won’t pay for it and employers won’t depend on college education as the door-opener for a good paying career.
For employers, it’s time to reevaluate your minimum hiring requirements especially minimum education. In order to avoid missing out on talent, what are the best predictors of future success if a four-year degree isn’t one of them?
Time: Most hiring managers are bombarded with multiple tasks, from placing ads to screening and interviewing potential job candidates. The average hiring manager spends 4.5 minutes reading each resume that lands on his or her desk and 15 hours each week sourcing candidates. And yet, because of the high volume of resumes coming in combined with inadequate applicant management capabilities, the time to hire hit an another record high recently at 29 days. For jobs requiring more advanced skills and for companies looking to find candidates who have the right skills and fit the culture, 6 months or longer is fairly common.
As you can imagine, there are several business-changing consequences to these trends: