There is a global challenge to find talent across industries and departments. To find out how enterprises can better understand the talent shortage and start planning their talent strategy going into 2022, read on.
As we look past 2021 and the pandemic, it has become apparent that we are entering 2022 with a completely different and equally challenging set of issues. The more lasting impact will be disruptions and shortages affecting the talent supply brought on by an accumulation of social and cultural changes set in motion over generations and exacerbated by the pandemic.
To understand the talent shortage and what enterprises are doing to adapt, Everest Group is conducting a survey, in partnership with IAOP, to discover strategies and best practices that enterprises worldwide are applying going into 2022 including, key priorities, motivations, and initiatives from a sourcing perspective.
“Winning the war” is no longer the goal, the challenge has become bigger
For the past several years, the “talent war” has had a special emphasis on the demand for high-end digital talent. Today, the challenge to find talent has become widespread across industries and departments and has spiraled into rising attrition rates, higher internal salary demands from employees, and increasing outsourcing rates across a range of job skill sets.
There isn’t an easy answer or a silver bullet to this conversation. The pandemic may have been the match to light the fire, but it’s no longer the root cause of what we’re dealing with now. Enterprises will ultimately need to shift their internal infrastructures to adapt to the change.
We can’t deny the urgency
Currently, there are now 2.7 million more job openings than people actively looking for work. In the US, 4.3 million people quit in August, up from 3.0 million one year ago. Yes, the pandemic set off a landslide of changes; however, the US had been moving toward a talent scarcity long before.
Workers’ life changes bring new realities
When the pandemic hit, a significant chunk of people began working from home – some doing so with children of all ages due to school and daycare shutdowns. Flexibility to allow for work-life blend and overall well-being became top priorities when it came to what people expected at work and how they engaged with their jobs. Now, over a year later, work from home has become a new desired working method, making companies that don’t support it less likely to attract some talent.
It was also during this time that many employees discovered how much they could save by not sending their young children back to expensive daycares. This, combined with the fear of exposing their children to COVID-19, drove some to quit their jobs and stay home with their children.
Further, a combination of all of the above is enough to overstress employees and cause burnout, leading some to leave their jobs to focus on their health. The bottom line is, employees today want flexibility, and they are willing to put their current jobs on the line to get it.
Among college students, we’ve also seen a decline in student Visas caused by worldwide shutdowns. Even now, Visa processing is delayed, lowering the number of possible graduates in the US eager to join the workforce. Since 2015, the number of students and their families, including commuter students, coming to the US has dropped by 300,000.
Finally, the baby boomer generation has experienced accelerated retirements, some due to the pandemic; for others, it’s just time. Across the US and Europe, as the majority of baby boomers retire and fewer people enter the workforce, there will be an estimated 2.3 million fewer workers annually for the next 10 years. And younger generations aren’t necessarily skilled enough or have the experience yet to fill many of the jobs left behind by the boomers, causing a gap for needed talent that just doesn’t exist.
How can enterprises adapt to the new reality?
Looking toward 2022, how should enterprises embark on their talent strategy? We now know that the talent shortage will not right itself, and there is no reset button. Companies cannot keep offering raises to keep employees because it’s costly and not sustainable. And stealing from your neighbor just causes them to steal back. The change will need to happen at the infrastructure level. Enterprises may adapt in a variety of ways, including changing the workforce structure, improving workplace culture, looking at other talent models, evaluating new geographies and looking to outsourcing, or leveraging digital/next-gen or automation capabilities. At the end of the day there is no one strategy that will be sufficient to “win” this and it will require many different strategies and tactics to build out a successful talent strategy.
Find out what other enterprises are doing
To learn more about the global talent struggle, Everest Group is conducting a survey among global enterprises across multiple departments. The goal is to understand how leading enterprises plan to strategize for talent in 2022. The research will drill into enterprises’ challenges and priorities, attrition levels, resiliency and agility planning, changes in sourcing models or shoring mix, headcount and salary expectations, impacts on environmental, social, and governance (ESG) matters, and more.
We want to address the root cause and better understand what can be done to mitigate the impact of the talent shortage.
What’s in it for you?
Participate in the study, and we will share a complimentary summary of the research results so you can better understand the talent landscape going into 2022 and start a talent strategy.