A new report from Allegis Group, a global provider of talent solutions, looks at major economic and demographic trends influencing the supply of talent around the world.
The report also provides insight into evolving talent acquisition practices and the changing markets for staffing, recruitment process outsourcing (RPO), and managed services provider (MSP) solutions around the world.
Notable trends by region include:
- United States. The U.S. economy has been an effective job creator, and skilled workers remain scarce. The need for cost control and efficiency will consequently be part of an effective procurement and contingent workforce strategy. Other factors including talent quality and retention may combine to compel planners to increase wages more quickly in the future.
- UK. While Brexit is a potential disruptor to longer-term hiring initiatives, job vacancies are at record highs following the 2009 economic crisis with a shortage of skilled workers to fill them. The UK’s mature market is conducive to the use of contingent workers, Indian offshoring, and contingent RPO, but that maturity may also slow MSP and RPO growth compared to the rest of Europe.
- Primary Eurozone. France and Italy still experience unemployment rates of 10 percent or greater. The region is also experiencing a high level of retirements, expected to continue for the next several years, as well as a shortage of STEM workers and an overabundance of industrial or low-level office workers. Further, the rate of RPO growth is expected to be higher in Europe, and contingent RPO may contribute to that growth. A focus on flexibility will be important for companies navigating these markets.
- Asia Pacific. Japan represents the dangers that extreme labor tightness can put on GDP while India represents the opposite: a potential labor supply to help other nations struggling to find enough skilled workers. Improved training and access to workers across boundaries will become an economic necessity in the region. RPO and MSP markets also have room to grow in size and sophistication.
Additional trends specific to the United States include:
- Millennials outnumbering baby boomers in the workforce
- Strong services economy
- Worker shortage in both STEM and lower-skilled roles
- Wage growth steady but modest
- Rising freelance workforce
- Mature markets for staffing, MSP, and RPO
- High use of offshoring for skilled and unskilled labor
As a result of these trends, Allegis Group expects U.S. companies to focus on increasing integration of employee recruitment, contingent, and flexible workforce strategies.
Additionally, it anticipates companies will focus on data, employer brand, and technology innovation to compete for talent.
Finally, Allegis advises U.S. companies to look for accelerated wage growth in critical skills.
Approach for All
With regard to global findings, Allegis Group recommends that talent organizations apply a conscious approach to three critical areas:
- Expand the External Talent Supply. Smart organizations are adding flexibility to their job requirements, opening themselves to the people with the right skills regardless of worker types.
- Optimize Internal Talent. Beyond determining where to recruit and what type of worker to seek, successful companies are increasingly looking to internal talent as their best defense against worker shortages and changing skills demands, especially as talent scarcity becomes more acute. An employee-first approach applies active training and skills development to fill workforce needs.
- Commit to Change – Looking Beyond Transactional Results. An effective talent partner goes beyond filling roles and finding workers, applying strategy, expertise, and technology to help clients navigate changing talent needs.