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A look ahead to the approaching shortage of qualified workers world-wide and suggestions for blending diverse work cultures.
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Global Business Services
1
Surviving theSurviving theWorkforce CrisisWorkforce Crisis
David DennardDavid DennardProfiles InternationalProfiles International
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Source: Barrett, J. “An impending work crisis.” Newsweek. September 20, 2002.
David Ellwood, Dean of Harvard University’s
Kennedy School of Government
“This is not something that tomorrow, all of a sudden, will show up in the headlines. This is a slow effect of changing demographics that is
absolutely predictable but with profound implications…
There will never be a moment where there is a massive crisis to call attention to this. If there
is a crisis, it will be too late.”
““Future History”Future History”
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In 2000, A Fairly “Young” World . . .In 2000, A Fairly “Young” World . . .
Under 5% 5% to 12.4% 12.5% to 20% Above 20%
Source: U.S. Census Bureau
Percent of Population Age 60+ 2000
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. . . Rapidly Aging by 2025. . . Rapidly Aging by 2025
Source: U.S. Census Bureau
Under 5% 5% to 12.4% 12.5% to 20% Above 20%
Percent of Population Age 60+ 2025
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Life ExpectancyLife Expectancy
Average age expectancy throughout human history <18 years
1900: 47 yearsToday: 77 yearsUS – 100 years ago 4% over 65Today 14% and rising Pattern duplicated worldwide
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61900 1950 1970 1980 1990 20001910 1920 1930 1940 1960
75
70
65
60
55
50
45
40
80
Source: U.S. Social Security Administration
Average Life Expectancy at Birth in the U.S.
Dramatic Increase in Life ExpectancyDramatic Increase in Life Expectancy
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The Baby Boom PatternThe Baby Boom Pattern
Source: U.S. Census Bureau International Data Base
1930 1940 1950 1960 1970 1980 1990
4.5
4.0
3.5
3.0
2.5
2.0
Birth
in M
illion
s
The Boom Years: 1946-1964
Reason 2:Reason 2:Dramatic Drop in Birth RatesDramatic Drop in Birth Rates
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88Source: Employment Policy Foundation analysis
and projections of Census/BLS and BEA data.
Millions of People
Expected Labor Force and Labor Force Demand
0
50
100
150
200
250
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
2022
2024
2026
2028
2030
Labor Needed
Labor Available
Screeching to a Halt:Screeching to a Halt:A Growing Shortage of Workers in the U.SA Growing Shortage of Workers in the U.S..
140142144146148150152154
2004
2005
2006
2007
2008
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Why? Dramatic Drop in Birth RatesWhy? Dramatic Drop in Birth Rates
Source: Age Wave
Tota
l Birt
h Ra
te
3.32.8 2.9
3.6
2.02.5 2.5
4.0
5.9
2.01.7 1.7 1.6 1.4 1.3 1.2
1.8
3.1
0
1
2
3
4
5
6
7
US UK France Canada Japan Germany Italy China India
1960 2000
Total Birth Rate
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Industrialized nations are currently experiencing the Industrialized nations are currently experiencing the leading edge of these population changes leading edge of these population changes
19% of the entire American workforce holding executive, administrative and managerial positions will retire in the next five years
Source: Beazley, et. al, Continuity Management, Mackay, Alan. “Mature Age Workers: Sustaining Out Future Labor Force.” An Ageless Workforce - Opportunities for Business' Symposium Conference Paper. August 27, 2003. www.ageing.health.gov.au/ofoa/wllplan/aawpapers.htm, Time to act quickly on aging.” The Japan Times Online. August 23, 2002 www.japantimes.co.jp/cgi-bin/getarticle.pl5?ed20020823a1.htm, A. Paulli, “Pension systems and gradual retirement in Italy”, September 2000, p.17
In the year 2000, there were more people receiving pensions in Italy (22 million) than people working (21 million)
Within the next seven years, over 33 million individuals in Japan (26% of the population) are expected to be over 65 years old.
By 2016, the number of individuals aged 60-64 in Australia is expected to almost double
Just 45% of German 55+ employed - Franz Muenterfering. By 2050 avg age goes from 42 to 50 and workforce shrinks from 50 Million to 39 Million
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3230
15
26
38
2118
35
16
9
15
8
0
5
10
15
20
25
30
35
40
Looking for a new job at anothercompany
Feeling at a dead end Fear of being laid off or fired
Y X Boomer Traditionalist
Source: The New Employee/Employer Equation, The Concours Group and Age Wave, 2004
Young Workers –Young Workers –The Bad News on EngagementThe Bad News on Engagement
%
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4539
32
4844
28
5752
35
65 6153
0
10
20
30
40
50
60
70
I really care aboutthe fate of thisorganization
(agree)
I’m willing to put ineffort beyond that normally expected
to help theorganization be
successful (agree)
I find my valuesand the
organization’s aresimilar (agree)
Y X Boomer Traditionalist
Source: The New Employee/Employer Equation, The Concours Group and Age Wave, 2004
Young Workers –Young Workers –The Bad News on EngagementThe Bad News on Engagement
%
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1313
33 35
28
4237
28
4946
35
6164
54
0
10
20
30
40
50
60
70
A good deal of my pridecomes from my work and
career (agree)
Time seems to passquickly when I’m at work
(agree)
I often feel energized bymy work
Y X Boomer Traditionalist
Source: The New Employee/Employer Equation, The Concours Group and Age Wave, 2004
Young Workers –Young Workers –The Bad News on EngagementThe Bad News on Engagement
%
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Average tenure for US workers <35Average tenure for US workers <35
Average time in a job is 3 years (the “3 year hump”)
80% stay less than five yearsOne third of all under 35 year olds are in the first year with their employer
Source: The New Employee/Employer Equation Survey
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What Matters to Young WorkersWhat Matters to Young Workers
Comprehensive benefits package (19%)Workplace that is enjoyable (13%)Work that enables me to learn and grow (12%)Comprehensive retirement package (10%)Work that is personally stimulating (10%)Flexible work schedule (10%)10 percent more in total compensation (8%)Two additional weeks of paid vacation (7%)Work that is worthwhile to society (6%)Flexible workplace (5%)
Source: The New Employee/Employer Equation Survey
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Things to remember about young Things to remember about young workers…workers…
Independent – many ‘raised themselves’Situational vs. structured – so they feel free to ignore rules, policies and procedures that they find restrictive
Digital communicators – vs. ‘interpersonal’Comfortable with diversity – unhappy with ‘one size fits all’ policies and management methods
Differences older counterparts oftenperceive as “poor work ethic”
Source: The New Employee/Employer Equation Survey
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1. Select candidates who have a strong fit to the job. In other words, put the right person in the right job – the first time.
Remember that statistics show dramatically higher productivity for job-matched workers, and that job fit is a major contributor to employee engagement.
7 Steps to Attract and Retain More 7 Steps to Attract and Retain More Young Workers – Step 1Young Workers – Step 1
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“…persons who had been matched outperformed to a statistically significant degree, those who had not been matched…”
14 Months After Hire:14 Months After Hire:
“Moreover, the differences widened after 14 months”
Source: Herbert M. Greenberg and Jeanne Greenberg, “Job Matching forBetter Sales Performance,” Harvard Business Review, Vol. 58, No. 5.
Six Months After Hire…Six Months After Hire…
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2. Create opportunities that reduce turnover and increase the retention of top performers.
Reduced turnover and increased retention are also results of Job Match.
7 Steps to Attract and Retain More 7 Steps to Attract and Retain More Young Workers – Step 2Young Workers – Step 2
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20Source: Herbert M. Greenberg and Jeanne Greenberg, “Job Matching forBetter Sales Performance,” Harvard Business Review, Vol. 58, No. 5.
WithoutWithoutJob Job
MatchMatch
Job matched candidates stay longer
WithWithJob Job
MatchMatch
24%24%28%28%
5%5%8%8%
Low Turnover IndustryLow Turnover Industry
High Turnover IndustryHigh Turnover Industry
% left / fired after 6 months% left / fired after 6 months 46%46% % left / fired after 14 months 57%% left / fired after 14 months 57%
% left / fired after 6 months 25%% left / fired after 6 months 25% % left / fired after 14 months 34%% left / fired after 14 months 34%
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3. Maximize productivity and employee engagement through well developed training and coaching strategies and instruments.
Get the most out of what you’ve got!
7 Steps to Attract and Retain More 7 Steps to Attract and Retain More Young Workers – Step 3Young Workers – Step 3
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4. Insure against future retention challenges - use succession planning and job matching systems to plan individual career paths that take people beyond the ‘three year hump’.
7 Steps to Attract and Retain More 7 Steps to Attract and Retain More Young Workers – Step 4Young Workers – Step 4
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5. Use 360° multi-rater feedback systems to consistently monitor ‘the pulse’ of the employee / manager relationship.
Young workers DEMAND and DESERVE to be lead individually and professionally.
7 Steps to Attract and Retain More 7 Steps to Attract and Retain More Young Workers – Step 5Young Workers – Step 5
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6. Provide opportunities for open communication and dialog. 360° multi-rater feedback systems are a great place to start.
Younger employees EXPECT to have a forum for providing input & feedback.
7 Steps to Attract and Retain More 7 Steps to Attract and Retain More Young Workers – Step 6Young Workers – Step 6
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7. Determine the behavioral and working-style relationships of young workers and their managers, and use that information to create winning teams.
Working styles and team dynamics vary dramatically in today’s diverse workforce.
7 Steps to Attract and Retain More 7 Steps to Attract and Retain More Young Workers – Step 7Young Workers – Step 7
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What if I still do not have What if I still do not have enough people?enough people?
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4%
20%
25%
16%
1%
34%
50 or Under 51-60 61-65 66-75 75 or older Never
At what age do you plan to retire?
It’s not It’s not ALLALL bad news – bad news –Many Employees Plan Not to Retire…Many Employees Plan Not to Retire…
Source: The New Employee/Employer Equation, The Concours Group and Age Wave, 2004
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Cutting Back Has New Meaning: Cutting Back Has New Meaning: Cyclic – or Project-Based – WorkCyclic – or Project-Based – Work
12%
39%
49%
Working full-time Working part-time Moving back and forthbetween working full-time and
not working
Preference for working after “retirement”
Source: The New Employee/Employer Equation, The Concours Group and Age Wave, 2004
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What Matters to Mature WorkersWhat Matters to Mature Workers
Comprehensive retirement package (16%)Comprehensive benefits package (14%)Work that enables me to learn and grow (13%)Work that is personally stimulating (12%)Workplace that is enjoyable (11%)10 percent more in total compensation (8%)Flexible work schedule (8%)Work that is worthwhile to society (7%)Flexible workplace (6%) Two additional weeks of paid vacation (5%)
Source: The New Employee/Employer Equation Survey
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Mature Workers –Mature Workers –The Good News on EngagementThe Good News on Engagement
3230
15
26
38
2118
35
16
9
15
8
0
5
10
15
20
25
30
35
40
Looking for a new job at anothercompany
Feeling at a dead end Fear of being laid off or fired
Y X Boomer Traditionalist
Source: The New Employee/Employer Equation, The Concours Group and Age Wave, 2004
%
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31
4539
32
4844
28
5752
35
65 6153
0
10
20
30
40
50
60
70
I really care aboutthe fate of thisorganization
(agree)
I’m willing to put ineffort beyond that normally expected
to help theorganization be
successful (agree)
I find my valuesand the
organization’s aresimilar (agree)
Y X Boomer Traditionalist
Source: The New Employee/Employer Equation, The Concours Group and Age Wave, 2004
Mature Workers –Mature Workers –The Good News on EngagementThe Good News on Engagement
%
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32Source: The New Employee/Employer Equation, The Concours Group and Age Wave, 2004
Mature Workers –Mature Workers –The Good News on EngagementThe Good News on Engagement
%
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1. ‘Retire Retirement’
– create bell-shaped career curves
Six Steps to Become More Attractive Six Steps to Become More Attractive to Experienced Mature Workers – Step to Experienced Mature Workers – Step 11
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The Shape of Careers to Come:The Shape of Careers to Come:“Down Shifting” for Continued “Down Shifting” for Continued ContributionContribution
20s
30s
40s
50s60s
70s
80s
Career Development
Career Deceleration
Source: Workforce Crisis: How to Beat the Coming Shortage of Skills and Talent by Dychtwald, Erickson, and Morison, April 2006
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2. Use succession, redeployment, and job matching systems well in advance to take a wider view of potential assignments for returning or downshifting workers.
Six Steps to Become More Attractive Six Steps to Become More Attractive to Experienced Mature Workers – Step to Experienced Mature Workers – Step 22
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3. Align the mature worker with the position, which may include new responsibilities and new management styles.
You will be exploring placing people in unfamiliar roles – job matching is essential for success.
Six Steps to Become More Attractive Six Steps to Become More Attractive to Experienced Mature Workers – Step to Experienced Mature Workers – Step 33
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4. Tap into the experience and management potential in mature workers.
Maturity is invaluable. Be careful not to rely on out-dated and subjective practices.
-Source: Beazley, et. al, Continuity Management, Mackay, Alan. “Mature Age Workers: Sustaining Out Future Labor Force.”
“19% of the entire American workforce holding executive, administrative & managerial positions will retire in the next five years”
Six Steps to Become More Attractive Six Steps to Become More Attractive to Experienced Mature Workers – Step to Experienced Mature Workers – Step 44
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5. Ensure managers are ‘age blind’ – reaching out to all age groups in the new blended workforce.
Six Steps to Become More Attractive Six Steps to Become More Attractive to Experienced Mature Workers – Step to Experienced Mature Workers – Step 55
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6. Use all available resources to understand how to communicate and relate to the future’s highly diverse workforces.
Mature workers have a strong need to better understand their younger counterparts. Assessments provide much of this needed information.
Six Steps to Become More Attractive Six Steps to Become More Attractive to Experienced Mature Workers – Step to Experienced Mature Workers – Step 66
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The question is not, The question is not,
““Is my organization facing an aging Is my organization facing an aging workforce crisis?”workforce crisis?”
The real question is, The real question is,
““Am I ready for it?”Am I ready for it?”
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Timothy Butler & James Waldroop“Job Sculpting” Harvard Business ReviewSeptember-October 1999
“In these days of Talent Wars, the best way to keep your stars is to know them better than they know themselves - and then use that information
to customize the career of their dreams”
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For more informationFor more information
Contact:
David Dennard972-701-0222