U.S. Employers have added jobs every month since October 2010, with unemployment hitting an 18-year low in May, edging the labor market closer to full capacity. For those seeking work this is welcome news. Yet for businesses, particularly those in high-growth sectors that are hungry for talent to fuel their expansion, it can pose a problem.
Areas such as IT, manufacturing and production, and frontline and consumer-facing roles are likely to feel the pressure of a tight labor market, with hiring intentions across these sectors sitting higher than any others.
In these conditions, employers need new ways of harnessing talent and attracting the skills and labor they need to grow. This means hiring managers and senior leadership need different approaches to attain and retain talent.
Here are three things that employers should consider when operating in this tight labor market.
1. The Solution May Be Closer Than You Think
Labor market predictions talk of extremes over the long-term: technology eating our jobs, robots replacing drivers or even the threat of a world without work. ManpowerGroup’s latest data shows 91 percent of U.S. employers say automation will lead them to hold or increase headcount over the next two years. In short, robots take tasks, not jobs.
While technology plays an exponentially bigger role in the way businesses are run, employers do not always know which skills they need today or will need 18 months from now. The role of employers in this climate of high employment and technological change is to map out skill needs and assess and identify candidates with adjacent skills sets; those that are closely connected and can be adapted to new roles.
In this skills revolution — where new skills emerge as fast as others become obsolete — employers should focus on identifying skill adjacencies and providing existing employees with opportunities to gain the skills needed to fill talent gaps. Take HR as an example: 86 percent of U.S. employers planning to reduce headcount in HR functions still expect an increase in their overall headcount. With little slack in the labor market, these employers are best served by identifying new roles for their HR staff that are relevant to their current skills, or retraining them for emerging roles.
2. Get Creative
Skills and access to employment are the pillars of success in the skills revolution, yet employers in the U.S. are increasingly experiencing a gap between the skills they need and those that people have.
We see this come to play in advanced manufacturing where up to 2 million manufacturing jobs could go unfilled by 2020 — an incredible number in an increasingly tech-forward industry. Veterans share many relevant, adjacent skills that can easily be adapted, developed and applied to high-tech manufacturing jobs where electromechanical skills are at a premium and large numbers of military personnel are working on industrial computer systems. Veterans also have strong learnability — the desire and ability to upskill — for these high-demand instrumentation, automation and controls technician roles.
In partnership with Rockwell Automation and the Academy of Advanced Manufacturing, ManpowerGroup launched a veteran-focused, fast-track 12-week training program combining classroom learning with hands-on lab experience and career coaching with a heavy focus on soft skills. The first class graduated in November 2017; all secured job offers from top employers, and many doubled or even tripled their salaries.
3. Turn to Human Solutions to Harness Talent
Adapting to the skills revolution requires a willingness to change and learn at all levels, from entry level to C-suite. In today’s rapidly changing world of work, it’s not what people already know; it’s how quickly they can learn that matters.
Employers can no longer rely on a spot market for talent. They need to seek people with high learnability. The same is true for senior staff. While 80 percent of leadership capabilities remain the same — adaptability, drive, endurance and brightness — a new style of leadership is required for the digital age. Leaders today must dare to lead and be prepared to fail fast. They need to nurture learnability, accelerate performance and foster entrepreneurialism. And of course, they must unleash potential in others. Now is the time to invest in people to upskill and reskill workers for the jobs of today and tomorrow.