Big Issue For 2020 Workforce: Getting Workers, Management on Same Page

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Oxford Economics and SAP recently released the report Workforce 2020: The Looming Talent Crisis aimed at understanding the opportunities and challenges of the evolving workforce. The research is based on survey responses from over 2,700 executives and more than 2,700 employees in 27 countries.

Understanding the core characteristics of “the new face of work,” as SAP puts it, is an important step in recognizing the opportunities and challenges that will come with it. SAP and Oxford Economics’ research identifies several key characteristics of the 2020 workforce, including that it will be an increasingly flexible one.

More diversity, more contingent work

Of executives surveyed, 83 percent cited that they plan to increase use of contingent, intermittent, or consultant employees in the next three years and 58 percent say that this requires changing HR policy. In addition to being flexible, the 2020 workforce will be increasingly diverse, and SAP advises that because of this HR leaders will need to become more evidence-based to deal with these realities.

As of now, only 50 percent of HR departments state that they use quantifiable metrics and benchmarking in workforce development and only 47 percent say they know how to extract meaningful insights from the data available to them. This is likely part of what influences the reported lack of progress towards meeting workforce goals that many executives cite. Just 33 percent stated that they have made “good” or “significant” progress towards workforce goals.

SAP identifies technology as a key need for the evolving workforce that organizations are unprepared for. While this may seem obvious, in the U.S. just 39 percent of employees report getting ample training on workplace technology and only 27 percent report access to the latest technology.

While it’s understandable that not all organizations can offer the most cutting edge technologies, a lack of sufficient training for the technologies that are in place could be seriously affecting employee productivity.

Misconceptions about Millennials

Aside from technology, misconceptions about Millennials are another trend of the evolving workforce that SAP points out (and with the expectation that this generation will make up more than 50 percent of the workforce by 2020, any misconceptions are noteworthy). The research points out that while Millennials are different from other generations, they may not be as different as they are typically portrayed.

According to executives surveyed, 60 percent believe Millennials are frustrated with manager quality but only 18 percent of Millennials say that they actually are. Additionally, 62 percent of executives report that Millennials will consider leaving their job due to a lack of learning and development, but just 31 percent of Millennials say they have considered this.

millenial-misconception

In terms of the emerging workforce, there may also be gaps between what companies believe employees want from them and what employees actually want.what-employees-say

Employees think job performance is most important

Perhaps not surprisingly, the most important incentive to U.S employees is competitive compensation (84 percent) followed by retirement plans (75 percent), and vacation time (62 percent). One in four (39 percent) of employees say higher compensation would increase loyalty and engagement with their current job.

When it comes to attributes that employees think are most important to their employer,  job performance and results is No. 1 (46 percent), followed by the ability to learn and be trained quickly (29 percent), and loyalty and long-term commitment to the company (28 percent).

This differs however, from what employers deem most important. The top three attributes executives want in employees are a high level of education and/or institutional training (33 percent), loyalty and long-term commitment (32 percent), and the ability to learn and be trained quickly (31 percent).

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What executives and employees do agree on is that their organizations are not focused enough on developing future leaders. Only 51 percent of U.S. executives say their company plans for succession and continuity in key roles and 47 percent say their plans for growth are being hampered by lack of access to the right leaders.

A problem with leadership

Employees agree that leadership is a problem area, with just 51 percent of employees stating that leadership at their company is equipped to lead the company to success. Better learning and education opportunities will be key to bridging this talent gap.

The need for technology skills in particular will increase in demand (e.g. cloud and analytics), although SAP’s data states that just 33 percent of employees expect to be proficient in cloud in three years. This statistic is slightly better when it comes to analytics, with 43 percent expecting proficiency in three years and almost 50 percent expecting proficiency in mobile, social media, and social collaboration.

In terms of training programs, only half (51 percent) of American executives say their company widely offers supplemental training programs to develop new skills. This aligns with employees’ perceptions toward training, with 51 percent reporting that their company provides the right tools to help them grow and improve job performance. Additionally, half (52 percent) of employees say their company encourages continuing education and training to further career development.

Take a look at the graphic below that highlights the five major labor market shifts discussed. Are you beginning to think about shifting workforce development strategies for the future?

Are you really sure what your employees think? Or are you making assumptions based on popular press reports that may not be founded on fact?labor-market-shifts

This originally appeared on China Gorman’s blog at ChinaGorman.com.

China Gorman is a successful global business executive in the competitive Human Capital Management (HCM) sector. She is a sought-after consultant, speaker and writer bringing the CEO perspective to the challenges of building cultures of humanity for top performance and innovation, and strengthening the business impact of Human Resources.

Well known for her tenure as CEO of the Great Place to Work Institute, COO and interim CEO of the Society for Human Resource Management (SHRM), and President of Lee Hecht Harrison, China works with HCM organizations all over the world to enhance their brands and their go-to-market strategies. Additionally, she serves on the Executive Committee of the Board of Jobs for America’s Graduates as well as the Advisory Boards of Elevated Careers, the Workforce Institute at Kronos, and WorldBlu. Addtionally, she chairs the Globoforce WorkHuman Advisory Board and the Universum North America Board. China is the author of the popular blog Data Point Tuesday, and is published and frequently quoted in media properties like Fortune, TLNT, Huffington Post, Inc., Fast Company, U.S. News & World Report and many others.

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5 Comments on “Big Issue For 2020 Workforce: Getting Workers, Management on Same Page

  1. “expectation that this generation will make up more than 50 percent of the workforce by 2020”

    Where does this “expectation” come from? This is only 6 years from now. Is there a planned mass-execution of boomers and GenX’ers planned and nobody told us about?

  2. “expectation that this generation will make up more than 50 percent of the workforce by 2020”

    Where does this “expectation” come from? This is only 6 years from now. Is there a planned mass-execution of boomers and GenX’ers that will open up a ton of jobs for millennials?

    1. This comes from projections of Baby Boomers leaving the workforce between now and 2020, mostly to retirement. If the current projections hold, then yes, Millennials will make up 50% of the workforce in the year 2020.

      But, the one wrinkle in this is that frequently projections do not hold up. For example, another economic downturn might push more Boomers to keep working, as it did during the Great Recession, and that could change all the projections and figures.

      Hedging on the number is just that — hedging. Nothing is certain in this life, so a little hedging on numbers that are going one way but could possibly change is not a bad thing.

      1. Thanks to the 2008 financial crisis, boomers’ 401K’s have tanked. In addition many were out of work for a long time due to age discrimination, and had to dip into their 401’s and IRAs. So as a result, huge numbers of boomers do NOT have the savings needed to retire. Add to that the number of boomers who want to keep working just to stay active or they love what they do, and guess what?

        We are NOT going to have huge numbers of retiring boomers as people expect.

        So, unless we are going to have even worsening age discrimination, or mass-executions, boomers are going to be a huge part of the job market for decades to come.

        1. Actually, you’re wrong. Yes, there are many Boomers who were impacted by the financial crisis and continue to be, but there are also a large number of Boomers who delayed retirement and continued working who want to get out now that things have improved somewhat.

          There are 10,000 Boomers retiring every day. Yes, the fact that a good number are continuing to work will impact the ability of the younger generations to find work, but the fact of the matter is that the younger generation is moving into jobs at a little bit faster clip and that will continue.

          Your own personal experience may be different, but the shift is happening. It may be slower than people anticipated 10 years ago, but it is picking up as we get further away from the Great Recession …

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