Why Is There a Talent Shortage and What Can You Do?
“Repetition is the mother of skill.” – Tony Robbins, American Author
The talent shortage is a new reality and it is here to stay for a long time. When we say this, we don’t mean just in Canada, but also across the world. The talent shortage is a complex issue and has just as heavy consequences for employers. According to a study – 2021 Q3, ManpowerGroup Talent Shortage and Employment Outlook Survey – 69% of global companies reported skill shortages in the year 2021.
That is a massive hike from the 35% that was estimated in 2013. The future doesn’t indicate that this trend is going to change any time soon. Many surveys and studies, such as the research reports produced by the Everest Group and news reports by Korn Ferry, show that the issue is here to stay.
However, you need not worry! There are a variety of solutions that will allow you to conquer the problem. This blog will not only cover the reasons behind the global talent shortage but also solutions that can be adopted by professionals as well as organizations.
We will also have a look at how an RPO agency fits into the picture and can help you bolster your ranks going forward in this context.
Why Is There a Talent Shortage?
There are a myriad of factors that play into the talent shortage issue. One of the main ones that consistently finds itself at the root of the problem is workforce demographics. We need to understand that employment and market conditions vary greatly from country to country. Changing demographics, work policies, company policies, education rates, wage rates, supply and demand, are all factors that ultimately add up to shape unique scenarios.
Having said that, there is an overall decline in the workforce population. This is one of the root causes for the talent shortage in 2022 and previously. It has been a steadily shifting phenomenon where the overall working population has seen a decrease. Here are a few reasons why this might be happening:
1. The Old Guard is Aging Out
According to a report by the Health Innovation Forum, persons born between 1946 and 1965 make up an estimated one-third of the Canadian population. This translates to roughly 10 million Canadians. By 2031, these baby boomers will reach an average age of 65 to 85-years-old. This puts a large chunk of the working population at the tail-end of their retirement, through to the next decade. This issue has only been worsened by events such as the pandemic where many were pushed into early retirement or loss of work. This left a huge gap in the labour market.
The pandemic played a significant role in the formation of these issues.
2. The Youth Are Not Prepared to Work in This Market
According to a Deloitte report, Millennials make up around 37% of the working population in Canada. However, many still lack the necessary skills to fill the vacant positions or are just starting. The shortage of time, high expectations and steep learning curves makes for a challenging road ahead.
3. Covid-19 and Immigration
The immigration debate concerning the labour market is nothing new. Now immigration may not have a direct effect on the labour market as per some claims. However, others see it as a major factor for economic growth, this is especially true if you consider temp jobs in Canada. Having said that, with the arrival of Covid-19, the Canadian government brought in many changes to their immigration policies – like most countries around the world.
“Making good decisions is a crucial skill at every level.“ – Peter Drucker, Austrian-American Educator
4. Changing Expectations
In terms of expectations, they come from both sides. From the industry’s side, there is an expectation to have a higher, more niche skill set to match growing technologies and needs. On the employees’ side, there is an expectation for better work hours, flexible working conditions, higher wages and so on. Hence, there is an inherent conflict.
You need soft skills and technical skills to overcome the market gap.
What Can Professionals Do?
Whether you are a professional or a newcomer entering the talent market, you need both technical skills and soft skills to better your chances. According to ManpowerGroup, the most in-demand technical skills for the past year 2021 were operations and logistics as well as manufacturing and production. Certain administrative and customer-centric roles also exist.
In terms of soft skills, you need to be resilient, adaptable to high-stress environments, and be able to think critically. Cultivating such skills will help you gain and maintain jobs in high-competition environments that the industry is faced with. You also need to make sure that you are up to date with the latest industry expectations and try to meet them to the best of your ability.
“Strive for continuous improvement, instead of perfection.“ – Kim Collins, Track and Field Athlete
How Can Organizations Combat the Talent Shortage?
Honestly, evolution is your only surefire strategy going forward. Organizations that want to succeed and close in on that talent gap need to change with the times and meet the expectations of the workforce. Younger generations not only expect more from employers but are also willing to take their valuable skills to the competition if the benefits are better.
So, take a moment to consider what you can give them. Things like higher wages, flexible work culture, dynamic learning opportunities and room to grow within the company are all great facets to consider. You should also look into reskilling and upskilling your employees. Investing in the reskilling of current employees is cost-effective in the long-run, while also directly addressing the talent shortage.
The fight to overcome the talent gap can be taken a step further if you re-imagine how you measure productivity. Quality is the name of the game. You might also want to consider switching up the recruiting and hiring strategies of the organization. Hire for transferable skills, work with data-driven recruitment process outsourcing (RPO) agencies or even an employee referral program for the best results.
How Can an RPO Agency Help You During a Talent Shortage?
One of the reasons companies prefer to work with RPO agencies is their ability to support large-scale restructuring and recruitment. It’s something that some companies may lack the ability to execute internally. One such period in time that demonstrates and highlights RPO services is the economic recession of 2008, where many companies turned to RPO agencies.
RPO agencies can help organizations source, recruit, manage accounts, generate leads and everything in between to give you the best possible recruitment initiative possible. Having said that, it is a path well worth considering in this current market.