There is an unprecedented situation in the U.S., which we characterize as a labor surplus, talent shortage. Simply put, the gap is widening between the skill sets that businesses need and the talent pool available.
According to the Bureau of Labor Statistics (BLS) in 2011, the unemployment rate in the U.S. for those with a bachelor’s degree or higher peaked around 5% during the recession, is now around 4%, and is trending back toward its historical average of 2-3%. For those with less than a HS diploma the unemployment rate is about 10 points higher. This explains the difference between the economy you have been seeing for a couple of years now on the nightly news, and what you see with your own eyes every day in your professional life.
This will be the number one issue facing businesses in almost every developed nation for the next decade. What’s causing this situation? Of course, entire books have been written about this, but there are two main drivers for the current talent shortage.
Technology: It is well known that productivity has led to a dramatic loss in manufacturing jobs. However, it has been estimated that as many as ten service jobs have been created for every manufacturing job lost, whether in healthcare, professional services, business services, etc. In general, the global workforce has lagged this mega-trend, waiting for it to reverse itself rather than getting out in front of it. The nightly news bemoans the loss of “good” manufacturing jobs, often ignoring the creation of service sector jobs, thus creating this talent shortage.
Demographics: The workforce is aging and declining in numbers in the U.S., but also in many European countries. One in four living Americans is a “baby boomer”, born between 1946 and 1964. The oldest boomers started turning 65 in 2011, at a rate of more than 10,000 per DAY. Yes, that’s per DAY, and that will continue for the next 18 years. The number of new workers is simply not sufficient to replace the boomers as they exit the workforce.
So what is the resolution to this situation? Any imbalance in supply and demand is ultimately corrected by an increase in supply, a decrease in demand, or some combination of the two. In future blogs we will explore what this means for plastics businesses looking to hire, and plastics professionals looking to enhance their careers.
Written by: Paul Sturgeon–Published in plasticstoday.com in April 2011.
If you have a topic you’d like to see discussed, a company that is growing, or other ideas for this blog, e-mail Paul at firstname.lastname@example.org.