March 24, 2010

Edited and Written by Ira S. Wolfe

Published by Success Performance Solutions

What's Inside this issue of The TotalView:

1.  Is a surplus of jobs and a shortage of workers really possible?

2.  Geeks, Geezers and Googlization

1. Is a surplus of jobs and a shortage of workers really possible?

It is... if a report just released this week has any validity. (This of course wouldn't break my heart either since I've been writing about this for over 10 years, including 3 books.)

The report, "After the Recovery: Help Needed -- The Coming Labor Shortage and How People in Encore Careers Can Help Solve it" says that by 2018, with an expected return to healthy economic growth but no change in current labor force participation rates or immigration rates, "it may come as something of a surprise that within less than a decade, the United States may face exactly the opposite problem - not enough workers to fill expected job openings."

If the research of Barry Bluestone and Mark Melnik holds up, there could be at least 5 million potential job vacancies in the United States, nearly half of them (2.4 million) in social sector jobs in education, health care, government and nonprofit organizations. The loss in total output could limit the growth of needed services and cost the economy as much as $3 trillion over the five-year period beginning in 2018.

Unfortunately even I find several assumptions troublesome. The first point of contention is "if the baby boom generation retires from the labor force at the same rate and age as current older workers, the baby bust generation (Generation X) that follows will likely be too small to fill many of the projected new jobs." 

I agree 100 percent with their statement that Generation X will be too small to fill all the shoes and seats of retiring Baby Boomers. That's not opinion - it's fact.

I disagree with the premise that Baby Boomers will retire at the same rate and age as current older workers.  We've already seen a significant number of Baby Boomers postpone retirement. With an insatiable need to stay active plus decimated retirement funds and many mortgages under water, retirement just isn't in the cards for many Baby Boomers. In fact, delayed retirement is creating unemployment collateral damage, something I've called the "gray ceiling."

Two other scenarios also shoot a few holes in this study. By 2018, the oldest members of Generation Y (also called the Millennials) will be in their mid 30s. The younger members will have graduated high school. With the largest generation in U.S. history in the workforce, quantity of workers won't be a problem. It will be quality.

The Millennials are also the most socially conscious generation since their grandparents and great-grandparents, the Veteran Generation (born before 1946). Filling jobs in the social and government sectors will be like a hand fitting a glove. To the dismay of the skeptical baby bust generation, the optimistic Millennials will begin to leapfrog their workforce predecessors.

And last but not least, technology will continue to automate many functions reducing the number of jobs required to get work done.  The jobs that will be available will require an ability to use the latest technology, adapt quickly, and work in a variety of work environments. Despite a never-say-die Baby Boomer attitude, the oldest Baby Boomers will be 73 years old.  Do you really think the generation that will stretch our health care systems to the max can also deliver the care? 

As one of those older Baby Boomers, I'm the first to say I'm no better prepared and ready to retire than I am to sit on a rocker on my front porch.  I believe millions of my cohorts feel the same way.  There will be jobs for these experienced workers to fill, but the question will be if they will be qualified to fill the jobs that are being created and if the jobs that do exist will be rewarding enough to keep Baby Boomers working.

In my opinion, we are headed for a time when we will have both high unemployment and job vacancies - a mismatch between available jobs and the number of people skilled enough to fill them. 

According to U.S. Department of Labor data, 62% of all U.S. jobs in 2010 will require higher skill levels. While 97 million people will be needed, only 43 million Americans will have the educational qualifications for these jobs. Businesses will try to make up the difference by using the failing talent safety valves discussed earlier. On the other hand, 38% of all U.S. jobs in 2010 will still be low-pay/low-skill and require 61 million workers. About 115 million Americans will be competing for these jobs.

In looking forward toward recruiting and retaining employees, it will be imperative to understand and appreciate the disconnect between high unemployment and the ability to fill jobs in a timely manner with the right people.

Geeks, Geezers, and Googlization

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Ira S. Wolfe Copyright 2010 - All Rights Reserved. Reprints and other distribution by permission only.