Within the labor force in the US, and to a lesser degree the world, there is a confluence of circumstances that cannot be ignored by C-Level leadership, and not relegated solely to the role of HR leaders: a shrinking workforce in key skill sets and demographics, and a decreasing average employee tenure.
One set of circumstances is a cultural shift in employee engagement and loyalty (I shared some thoughts on this on LI and below). While many factors are affecting this and it is unlikely that these circumstances will change in the near future, the reality is that this environment has been created by a cultural shift, and therefore, can plausibly be impacted and redirected by focused efforts to change the culture.
The second set of circumstances, unfortunately, is in fact a fixed issue. According to the US Census, between 2000 and 2020, the population of 35-44 year old employees in the US will decline by 10%- a category that has traditionally been relied on for management and leadership development and succession planning. In the age groups of 15-34 and 45-55, population growth is around 5%, while the experienced end of the spectrum, ages 55-64 is growing by 73%. It’s important to note that this general change in the age of the working population is happening in major economies around the world.*
When strategic leaders look at the convergence of these two major changes in the workforce- while considering that unemployment for critical positions and key skill sets normally fall between 0.0 and 3.0%*- it’s clear that there’s a need to change how organizations plan for and manage talent and the workforce in general.
So… explaining the problem is the easy part. Organizations that are successful in the coming decades, will be those who confront these realities head on, and devise innovative solutions to managing the Talent Lifecycle as it pertains to candidates, new hires, employees, and exiting employees.
Here are my thoughts on the issues facing career mobility, copied from a post I shared on the Employer Branding Group in Linkedin:
The US Bureau of Labor Statistics has been running a longitudinal study since 1979 to look at Number of Jobs Held and Duration of Employment, and your estimates are very accurate. 18-46 year old Americans have an average of 11+ jobs during that time, changing jobs just about every two and a half years. Extrapolated out, it’s safe to estimate that across an employee’s career, they will average around 3.5 years per stop.
Great question, though, on the why, and something I’ve researched heavily. The core factors are pretty evident, and I think have been stated above- lack of pensions combined with portability of 401k plans, increased rate of organizational mergers and acquisitions, and a greater economic uncertainty and lack of stability.
The factors have changed the way we view careers and how we identify paths to success, particularly for the younger workforce. In my parents day, if you switched jobs 4 times in 10 years, there would be concern about your commitment and consistency. Now, if a candidate has only held one job in 10 years, there’s questions about this persons willingness or desire to grow and challenge themselves.
With career mobility no longer frowned upon, and in many cases expected, employees see greater and faster opportunity for promotion and growth through employer change, rather than by staying with their current job. Another factor has been suggested as well, with respect to ownership/leadership expectations.
Changes to the transactional mechanisms and the opening of global markets has lead to greater volatility in stock markets, and with the increase in the rate at which stock value and targets affect corporate compensation, public companies are not only more willing, but also incentivized to “right-size” their workforce more quickly to maintain or achieve those targets. This has impacted worker’s expectation of loyalty from their employer, thus changing their feelings of loyalty to their employer. This is also impacting the business practices of private companies looking forward to IPO’s.
Again, many have written- there are many factors affecting this, and none of which appear to be changing soon. So, the question for employers and recruiters, is how to you attract, select, hire, and manage employees within this landscape. Here are a few thoughts:
Attracting – leverage employer brand related to tenured employee stories, career paths, and long term outlook of the organization to attract people who are looking for those qualities.
Selecting- provide clear career path and specific long-term compensation roadmaps to help candidates envision a long term career with your company from the interview stage. Also, talk with candidates about culture and fit and how those factors impact long-term success for your workforce- this can help weed out those who don’t feel they are a good fit.
Hiring- ensure that your employer brand is both genuine and unique, then communicate and live the brand throughout the onboarding process. Ensure that your new hires experience the workforce as you have illustrated it during pre-hire discussions.
Managing- be aware of the career engagement arc, and implement processes to continue to challenge, reward, and respect your employees appropriately to different stages of their employment with you.
*From Tom Casey, Tim Donahue, and Eric Seubert in their book, Talent Readiness, The Future is Now.