Hurricanes Charley, Francine, and Ivan battered much of the eastern half of the United States these past few weeks, leaving a devastating path of death and destruction. Property damage, caused by rain and high winds, totaled in the billions of dollars. For hundreds of miles, cities and towns downstream of the storm flooded as rivers overflowed their banks. Thousands of businesses were closed, many of them never to open again.
Eventually this hurricane season will come to an end. Businesses will re-build and life will get back to normal – so many people think.
The U.S. business community is in the direct path of an even more powerful storm. Unlike the hurricanes, this storm and its disastrous path can be predicted with a reasonable degree of accuracy. It’s what I call the Perfect Labor Storm. When it hits, America will experience the greatest labor shortage in her history. Unlike forces of nature, which come and go, the Perfect Labor Storm will profoundly affect U.S. businesses for years to come, and no region will go untouched. It’s barely started and already industries like healthcare, manufacturing and technology are already feeling its effects.
A few skeptics question the accuracy of this forecast when six million workers currently are unemployed or working in low-skill, low-wage jobs. All I can say is that they are shortsighted. The naysayer ignores the key threat of the Perfect Labor Storm, believing the problem is in the number of people available to fill jobs, or having enough butts to fill seats. A new report released by the Aspen Institute only confirms the gravity of the situation.
The Aspen Institute correctly identifies the problem …
“overall skill levels of American workers is on a collision course with the skills requirements of American employers.”
Smart business owners will heed this dramatic wake up call and begin to take all necessary precautions to weather the storm.
The impending storm is about workforce gaps in the three areas: number of workers, skill levels, and wages. A business that defends itself against only one gap is vulnerable to the other two. If upper management fails to focus attention on human resources, strategic plans will be as useless as paper files stored in a flooded basement. Human resources professionals also must begin to connect the organization’s strategic plan with human capital metrics for their companies to remain competitive and profitable.
Consider these facts:
The immediacy of the worker shortage crisis is evidenced in a story recently published by the Associated Press about Seimens. The company received 1,000 applicants for 500 new manufacturing jobs. After resume parsing and screening, a mere 35 applicants had the necessary skills to perform the job.
They are not alone. The National Association of Manufacturers confirmed this as an indicator of things to come in a study they conducted in 2003. While manufacturers having lost two million jobs, 80 percent of the association’s members reported a moderate to serious shortage of qualified applicants. Despite the depressing news about layoffs, downsizings, and outsourcing, the manufacturing industry is facing a shortfall of highly qualified employees with specific educational backgrounds and skills, rather than a shortage of job applicants.
The business owners who survive the impending labor and skills shortage are those who strategically plan to meet future workforce needs. Success Performance Solutions recommends a three-part strategy, which is:
1. Select the right people
2. Develop the right people
3. Retain the right people
Read more “Perfect Labor Storm Fact Book”