Globalization is leading to increasing international standardization of educational challenges and systems. International organizations increasingly emphasize a largely common program of competence development and lifelong learning and the widespread adoption of international conventions that form the normative basis for the competencies.
Work practices associated with increased employee involvement – such as the introduction of high-performance work organization involving devolved decision-making, and reliance on team-based systems – are perhaps the most important of the management practices affecting skill requirements. Self-managed teams in particular transfer management skills to front-line workers as they are exposed to the tasks other team members are performing.
Today’s competitive business environment continues to increase pressure on employers as they seek more cost structure flexibility while negotiating increasingly volatile economic cycles. Business leaders are confronting the challenge of executing business strategies and remaining competitive while simultaneously dealing with value/margin compression amid ongoing economic uncertainty.
As is becoming clear in the Human Age, securing access to the increasingly finite pool of individuals with in-demand skill sets will be fundamental to business success.
What is talent shortage?
Innovative practices at the workplace and competitive business environment are changing the demand for the types of skills needed on the job and organizations are finding it tough to meet new demands of changing economies, specifically the shortage of talented or skilled workforce.
From an economic perspective, the concept of shortage poses something of a problem. The term talent or skill shortage sometimes used to refer to a shortfall in the total number of individuals in the labour force, and sometimes denotes the possible mismatch between workers and jobs in the economy. It is defined as a situation where the numbers of workers required with a particular skill exceeds the number available in that skill area at current levels of remuneration.
Some survey has been conducted highlighting this glocal (global+local) predicament of organizations, which we will be referring ahead hereunder in order to understand the gravity of the talent shortage.
Manpower Group Talent Shortage Survey 2013
The first survey we will be referring is The Annual Talent Shortage Survey by human resource firm Manpower Group, recently surveyed over 38,000 employers across 42 countries and territories. The 2013 survey is the eighth in the series and identifies the proportion of employers who report difficulty filling positions in their organization. Employers are also asked to gauge the degree of impact talent shortages have on their organizations and which strategies they are using to overcome the skills gap.
The global results of Manpower Group’s Talent Shortage Survey reveal 35% of employers worldwide are reporting shortages, the highest level since prior to the global economic crisis. Japan has one of the gravest shortage situations with 85% employers having difficulty in finding talent. Report further revealed that apart from employers in Japan, those in Brazil (68%) are having the greatest difficulty finding the required talent, while those in South Africa (6%), Ireland (3%) and Spain (3%) report the least difficulty.
Additionally, the proportion of employers telling that talent shortages impact their client-facing abilities to a high or medium degree has swelled to well over half (54%). In fact, the increasing number of employers reporting a high or medium impact might be viewed as an encouraging sign. The uptick indicates more employers recognize the need for access to top talent; in an uncertain business environment the right skills are essential to leveraging opportunities once they appear.
The research shows that globally the roles most difficult to fill are skilled trades’ workers, engineers and sales representatives, which are unchanged from last year. It also showed that employers reported that accounting and finance and management positions are also increasingly hard to fill.
Report said that worldwide talent shortage has local impact with 61% of employers in India struggling to fill jobs in contrast to the Global Average standing at 35%. The survey report suggests that while Japan faces the critical situation in finding appropriate talent at 85%, India on the other hand observes that 61% of employers struggle to fill jobs indicating that talent shortage has been an existent problem, the situation is expected to turn worse as this problem intensifies around the world.
According to the global results, India and China are the highest-ranking countries for off shoring, ranking in first and second place, respectively. However, the study said that these countries also show some of the largest increases in talent shortages between the 2009 global low-point and the latest survey. For example, in 2009, 20% of employers in India reported difficulty filling jobs. Four years later, the figure has increased to 61%.
The study further said that employers in India have the most difficulty filling jobs in accounting and finance, IT staff and engineers, as compared to last year when IT staff, marketing/public relations/communication and engineers were the most difficult positions to fill.
The results of our research also indicate that a growing number of employers acknowledge the peril of conducting business when forward-looking talent management strategies are put on hold. As a result, nearly eight out of ten employers surveyed tell us they are taking steps to grow the talent pool and ensure access to the right skills that will help drive business results.
Aspiring Minds’ National Employability Report – Graduates 2013
India graduates more than five million graduates every year. Engineers comprise a small (but significant) part of it at around six hundred thousand, whereas the rest take up a variety of three or four year bachelor degree programs. Whereas, these were conventionally limited to Arts, Commerce and Science, a number of new programs have come up in areas of business management, hospitality, fine arts and biotechnology.
Conventionally and currently, higher studies have been considered a path to a respectful and meaningful employment. As we continue to expand capacity and diversity of courses, it is important to understand what proportion of graduates graduating every year are actually employable in India’s knowledge economy.
Delving deeper into the matter, Aspiring Minds, an employability solutions company, conducted a national audit of employability of three-year Bachelor’s Degree graduates and release the findings titled as ‘Aspiring Minds’ National Employability Report’. The survey included 60,000 students from colleges across India, slated to graduate this year.
Highlights of the Report
‘That graduation is the stepping stone to the employment market holds no good in present times’ is the highlighting fact of the report. Report reveals an astonishing fact that as many as 47% graduates in India are not employable for any industry role. Their lack of English language knowledge and cognitive skills were identified as the major obstacles to their suitability in the job market.
India churns out tens of thousands of graduates each year but less than half of them are “employable” or possess the basic skills necessary for any industry role. The alarming statistics of nearly half of the country’s graduates not being employable in the knowledge economy needs great attention with interventions at both the school and higher education levels for improving basic skills of students as well as renewing the focus on imparting vocational training alongside theoretical learning.
According to the report, the employability of graduates varies from as low as 2.2% in roles such as corporate communications/content development and 2.59% in accounting to 15.88% in sales-related jobs and 21.37% for roles in the business process outsourcing (BPO/ITeS) sector. Most of the graduates (35.95%) were found suitable for clerical/secretarial roles.
For an analyst’s role, close to 84% graduates were found to lack the right levels in cognitive ability. 90% graduates did not have required proficiency in English communication.
Another area of concern is that many graduates from accounting and information technology backgrounds remain ‘invisible’ to potential recruiters since they do not belong to the top colleges usually preferred by companies. 41% of graduates employable in accounting roles hail from colleges beyond the top 30% colleges, whereas for the IT services sector this percentage is 36%.
The employability varies from role to role based on varying degrees of proficiency required in language and cognitive skills and despite being employable, these students have no way to signal their employability to recruiters who end up recruiting only from reputed colleges and universities.
System Needs Overhauling
This existing system, apart from creating economic inefficiency, also breeds unfairness for the students. An effective means to tackle it could be to devise and employ a scalable certification to ‘discover’ the employability of students across the nation.
Since a graduation degree is considered a pathway to a job in the knowledge economy, a renewed focus on vocational training should be re-emphasized, said the report.
The objective of these skill-oriented vocational trainings should be creating a workforce empowered with the necessary and continuously upgraded skills, knowledge and internationally recognized qualifications to gain access to decent employment and ensure India’s competitiveness in the dynamic global market. It must aim at increasing the productivity and employability of workforce (wage and self-employed) both in the organized and the unorganized sectors.