CHARTS OF THE DAY: On Increasing Job Openings and Scarce Candidates

Today's chart(s) of the day come courtesy of Gluskin Sheff + Associates, and the excellent (and filled with charts) report from David Rosenberg titled 'The US Labor Market in Pictures, Tighter Than It Looks!', which provides a fantastic overview and re-set of the macro trends for employment in America.

Taken from the Gluskin Sheff report, I want to call out two of the report's dozens of charts, the first on the growth in absolute job openings in the USA:

Job openings continue to rise from the post-recession bottom, and with about 4 million current openings, seem on track to eventually climb to eclipse the pre-recession highs. In fact, if suddenly all 4 million openings were filled from currently (officially) unemployed workers, the unemployment rate would fall to about 4%.

But of course things are not so simple or neat, and this next chart illustrates the challenges that many employers are reporting trying to fill jobs in a time of rising openings:

Companies, especially smaller companies, are reporting increases in 'difficult to fill' positions, (a level just off it's five-year highs), and if you dig into the Gluskin Sheff report further, you will see that over 40% of companies are reporting 'few or no qualified applicants' for their openings.

These trends of rising job openings combined with, at least for many types of jobs in many industries, are having a tightening effect on the labor market overall. I am not smart enough to try and tell you exactly why this is happening right now, it is certainly a complex and debatable set of circumstances that includes the aging workforce, the governmental safety net, firm's inability or unwillingness to invest in training candidates, and the 'fake-or-maybe-it-is-not-fake' shortage of candidates with the needed skills for the modern age.

But the data seem to show one thing that is clear - the labor market is starting to show signs of tightening, probably making it more difficult for you in the short and medium term to deliver the candidates you need to sustain your business and talent objectives.

It might be time to start re-thinking all the things that make your shop the place where increasingly scarce candidates want to land.

Happy Wednesday.

PODCAST - #HRHappyHour 179 - Data Driven HR

HR Happy Hour 179 - 'Data Driven HR' (Live from Equifax Workforce Solutions Forum 2014)

Recorded Tuesday, April 1, 2014

Hosts: Steve Boese, Trish McFarlane

Guests: Dann Adams, President, Equifax Workforce Solutions and Mike Psenka, Senior Vice President Workforce Analytics, Equifax Workforce Solutions

Last week Steve and Trish were able to attend Equifax Workforce Solutions Annual User Conference in Scottsdale, AZ and sit down with Dann Adams and Mike Psenka to talk about some of the ways that more advanced capability and increased availability of data and analytics are changing the way HR gets done, and increasing the opportunities for HR to contribute significant business value.

Data is increasingly the 'must have' resource for HR leaders. It can allow the leveraging of that data and the related insights on pay, turnover, and job movement from a wide swath of industries and millions of data points in order to give organizations a better understanding of how their workforce trends stack up to their peers. It also means using data and decision support tools to ensure the organization is making the right decisions and remaining compliant with complex ACA requirements.

Equifax Workforce Solutions through their technology solutions, extensive and robust data set from which to derive insights, and the domain experience of their team are at the forefront of delivering on the promise and potential that data and analytics offer to HR leaders and organizations. On the show, Dann and Mike share a few examples and share their insights as to how HR organizations can get the most value from these data driven approaches. 

You can listen to the show on the show page here or using the widget player below: 

Popular Business Internet Radio with Steve Boese on BlogTalkRadio

Additionally, you can subscribe to the HR Happy Hour Show on iTunes, or for Android device users, from a free app called Stitcher Radio. In both cases just search for 'HR Happy Hour' and add the show to your podcast subscription list. 

This was a fun and informative show and I would like to thank Dann, Mike, and everyone at Equifax Workforce Solutions for allowing the HR Happy Hour Show to be a part of Forum 2014. 

The analytics takeover won't always be pretty

Seems like it has been some time since I dropped a solid 8 Man Rotation contribution here on the blog, so to remedy that, please first take a look at this recent piece on ESPN.com, 'Fears that stats trump hoops acumen', a look at the tensions that are building inside NBA front offices and among team executives.

In case you didn't click over and read the piece, the gist is this: With the increased importance and weight that a new generation of NBA team owners are placing on data-driven decision making and analytical skills, that the traditional people that have been the talent pool for NBA team management and executive roles, (former NBA players), are under threat from a new kind of candidate - ones that have deep math, statistics, and data backgrounds and, importantly, not careers as actual basketball players.

Check this excerpt from the ESPN piece to get a feel for how this change in talent management and sourcing strategies is being interpreted by long time (and anonymously quoted) NBA executives:

Basketball guys who participated in the game through years of rigorous training and practice, decades of observation work through film and field participation work feel under-utilized and under-appreciated and are quite insulted because their PhDs in basketball have been downgraded," the former executive, who chose to remain anonymous, told ESPN NBA Insider Chris Broussard.

One longtime executive, who also chose to remain anonymous, postulated that one reason why so many jobs are going to people with greater analytical backgrounds is because newer and younger owners may better identify with them.

"Generally speaking, neither the [newer generation of] owners nor the analytic guys have basketball in their background," the longtime executive told Broussard. "This fact makes it easy for both parties to dismiss the importance of having experience in and knowledge of the game.

The piece goes on to say that since many newer NBA owners have business and financial industry backgrounds, (and didn't inherit their teams as part of the 'family business'), that they would naturally look for their team executives to share the kinds of educational and work experience profiles of the business executives with which they are accustomed to working with, and have been successful with.

The former players, typically, do not have these kinds of skills, they have spent just about all their adult lives (and most of their childhoods), actually playing basketball. A set of experiences, it is turning out, no longer seems to provide the best training or preparation for running or managing a basketball team. 

But the more interesting point from all this, and the one that might have resonance beyond basketball, is the idea that the change in hiring philosophy is coming right from the top - from a new generation of team owners that have a different set of criteria upon which they are assessing and evaluating talent.

Left to tradition, hiring and promotion decisions would have probably only slowly begun to modernize. But a new generation of owners/leaders in the NBA are changing the talent profile for the next generation of leaders.

The same thing is likely to play out in your organization. Eventually, if it has not happened yet, you are going to go to a meeting with your new CHRO who didn't rise through the HR ranks and maybe is coming into the role from finance, operations, or manufacturing. In that meeting your 19 years of experience in employee relations might be a great asset to brag on. Or it might not be.

And you might find out only when you are introduced to your new boss, who has spent her last 5 years crunching numbers and developing stats models.

Have a great week!

CHART OF THE DAY: The Falling US Birth Rate

For today's chart - take a look at the how the USA birth rate has been declining over the last several years, and after the chart, and for no additional costs, I will drop some comments about what, if anything, this might mean for you, the HR/Talent pro:

What might this mean, or at least suggest?

1. Your first reaction is that it means nothing. Who cares if there are relatively fewer kids being born right now? This won't impact labor markets for at least another 15 years or so and by then, who cares? A robot will be doing your job by then anyway, right?

2. But it is not just the sources of candidates/employees that matter or should matter to you. If your business has anything to do with selling products or services to the baby/youth/teen markets, then this trend is going to impact you. And if you think, 'We make industrial products that go into new home construction so this does not affect us', you might want to think again. The declining birth rate shouldn't be considered in a vacuum - their are related trends in marriage rates and ages of first marriage, household formation, and related spending at play here as well. Long story short, Americans are getting married less, are older when and if they do get married, are having fewer children, and are having them at more advanced ages than in the past.

3. This combination of a decline in birth rate and rise in the average age for both first marriages and having children will, if it has not already, influence your workforce planning processes in a few ways. You might be able to project a decrease or at least a reduction in the rate of increase in your benefits costs for covered dependents in the next few years, as your employees are covering fewer kids than in the past. Your succession planning processes may need to be re-emphasized if later career employees begin leaving (or simply taking leave) for child care reasons. These later career employees, say in their late 30s and up, are likely to have more senior and important roles in your company. Finally, if you are really and truly thinking long-term, say out 10-15 years, larger and wider demographic trends could effect things like expansion plans and ability of organization to move into new markets.

Perhaps I am stretching credibility by suggesting that you should really be worried about a probably caused by the 2007-2008 recession down trend in the birth rate when you have much more immediate and pressing concerns.

But I still find this kind of data fascinating, and even if you can't find an immediate or even medium-term impact of these bigger trends, I think they are worth recognizing. If nothing else you will at least know why the local school board wants to consolidate your elementary schools in the next few years.

Happy Thursday.

CHART OF THE DAY: Do you trust this chart?

...if you are say about 25 or 30 years of age, you probably don't.

This week's installment in CHART OF THE DAY comes courtesy of the recently released Pew Research Report titled Millennials in Adulthood: Detached from Institutions, Networked with Friends, a look at how the Millennial generation is transition into adulthood.

One of the more interesting findings is that, at least according to this report, the Millennials are much less trusting than the other, older generations. Take a look at the chart from the Pew report, then as you have come to expect, I will have a couple of comments about the data.

My thoughts on the chart:

1. There exists a pretty vocal cadre of people that think that all of these kind of generational differences research reports are silly, and that people are all individually distinct, and thus making broad conclusions and generalizations about entire generations is a wasted effort. These people are also wrong.

2. Could this lower relative level of 'trust' be a factor of the Millennial generation's observance of their parents experience with work and workplaces, which to at least some degree involved the breakdown of things like the employer-employee trust relationship, the ongoing decrease in organized labor, and the gradual phasing out of defined benefit pension programs? Do Millennials 'trust' less because their parents trusted their employers too much?

3. It could be that the lower 'trust' levels are also a reflection of Millennials own economic challenges. Facing a tough job market in the last several years, feeling the pressure of (for many), significant student loan debt levels, and seeing their friends and themselves having to take jobs outside of their fields, and often in the service industry where low wages, limited benefits, and lack of stability prevail. 'Trust' could be a function of vulnerability. The more vulnerable you are economically, the more wary you become.

Anyway, have a look at the entire Pew Research report, it offers some interesting data on how this important generation is transitioning into adulthood and what their attitudes suggest for the future of work, workplaces, and the society at large.

Happy Wednesday.