Last week I attended the Illinois Search and Staffing Association’s Midwest Staffing Owners & Executives Retreat. The agenda for this event was packed with really strong speakers and we managed to mix in some fantastic networking, including a hilarious masquerade murder mystery dinner.
The real mystery we tried to solve at this event, however, is predicting our economy and understanding where all the U.S. workers are. Two incredible speakers in particular addressed these mysteries, and today I’d like to share my key takeaways.
Just Don’t Do It
First, Jason Turner, Chief Investment Strategist from Great Lakes Advisors/Wintrust always does a great job of giving a ton of detailed economic data without making you feel like you’re listening to a ton of detailed economic data. Jason pieced together the main factors creating today’s unprecedented economic picture, such as:
- The pandemic economic recovery is consumer-driven
- Businesses are not building as much inventory
- The cost of energy and food skyrocketed in recent months (but food is beginning to come back down)
- Low unemployment is causing wage inflation & employers will have to acquiesce until inflation slows down
- Consumer saving is way down
- Interest rates will probably continue to go up
And my personal favorite… “just don’t even open your 401(k) statement until about the middle of next year!”
Jason left the staffing owners and executives feeling like plenty of business opportunity will continue to exist, but there are many “what if” scenarios that exist, too, when it comes to economic outlook and recession potential.
McKinsey Had It Right
The next morning, we heard from Dr. Rachel Sederberg, Labor Economist/Research Manager at Lightcast. Rachel’s presentation, “The Demographic Drought,” was a deep-dive into various factors that are impacting the U.S. workforce.
I looked forward to this session and it did not disappoint. I’ve worked in staffing & recruiting for 26 years, and I can clearly remember when an important book was published in 2001: The War for Talent (Michaels, Handfield-Jones, Axelrod). These McKinsey consultants predicted that in the coming decades (and by the year 2020) there would be millions fewer workers than jobs, and that companies needed to embrace a true talent mindset and prepare to compete in the “war for talent.” This book was huge at the time and guess what?! They were right!
Dr. Sederberg’s presentation highlighted that we currently have 11 million fewer workers than jobs, which is largely attributable to 7 main factors, including:
- Misalignment – we need more people without college degrees for the trades (do not miss this new Lightcast research, “Who is Going to do the Work?”)
- Younger populations are drying up. There are simply not enough people being born to replace the retiring baby boomers.
- Immigration is an opportunity to recover from our labor crisis, but immigration is highly politicized.
- COVID – not only did it change how we work (remote & hybrid), many chose to retire early or they chose to become self-employed (including me!).
McKinsey was right, there is a significant war for talent … and they didn’t even know how a global pandemic would shift the world of work, potentially forever. Both the McKinsey consultants and Dr. Sederberg have the same advice:
- Embrace a talent mindset
- Craft a winning employee value proposition
- Retool your recruiting strategies
- Develop your people
- Manage your team by taking appropriate steps with your A, B, and C players.
Dr. Sederberg went even further with the following recommendations:
- Leverage automation where possible (but ironically, developing more automation requires even more highly skilled talent)
- Figure out how to re-engage disengaged workers. Businesses must attract people back to work through increasing the value of work.
- Shorten your hiring processes. Onboard, train, and enculturate new employee quickly.
- Look at new talent pools, including the disabled, people with spotty employment backgrounds, caregivers, ex-offenders, veterans, post-retirees.
Thank you, Illinois Search & Staffing Association for a truly value-added event. I’m proud to be a two-time past president and current board member for this exceptional association. Let me know if you’re interested in becoming a member and/or getting involved on a committee or on our board.