CHART OF THE DAY: What age group has employment rising faster than population?

Quick hit for a busy Tuesday - I wanted to share a chart (and the link to a few more interesting charts), on population growth, labor force growth, and employment growth between 2008 and 2014 for one specific category of workers - those aged 65 and up.

First, here is the chart from Mish's Global Economic Trend Analysis, then some observations and free commentary:

Apologies if the chart resolution isn't great, but hopefully you can still make out the key pieces of data. Essentially, while the population growth of those aged 65+ is really high (about 20% of an increase in this group since 2008), the rates of increase in labor force participation and employment are even higher (about 37% and 35% respectively).

Additionally, this is the only age group where the labor force and overall employment rates are outpacing population growth. For example, 16-24 year olds have seen their ranks increase by about 4%, but employment for that group has declined about 6%.

I know I have posted a few times about the general increase in age of the workforce, and the challenges and opportunities this presents to organizations, but it is probably worth thinking about perhaps more frequently than before. Older workers are often overlooked, and can present great sources of experience, insight, and even value, as any folks in this cohort do probably realize that they might be outside of their prime earning years. Also, many will be motivated by the opportunity to share their knowledge and give back as it were to their less experienced workers - which is exactly the kind of on the job learning and mentoring that the next generation desires.  Lastly, you probably don't have to be that concerned, (if at all), with ongoing development and career pathing with this group - they have likely ran most of their career journeys already.

Anyway, this will have to be the last time I go on again about the aging workforce, I think the point has been beaten into submission. Unless I am still blogging say 20 years from now, where I will be screaming about the value of the older workers as far as I can still shout.

Happy Tuesday.

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.

CHART OF THE DAY: The Return of the Quit

Since many of us in the USA have been a little preoccupied with the relentlessness of global warming that has cleverly disguised itself in the form of the coldest, snowiest, most miserable winter ever, you'd be excused if you didn't notice a little phenomenon or trend developing in your workforce reports and analyses.

Employees are quitting again. 

Well, to be fair, employees always quit, even in bad economic times. But take a look at today's Chart of the Day, from the Bureau of Labor Statistics year-end JOLTS (Job Openings and Labor Turnover Survey) report which suggests that the 'quit rate', i.e. the voluntary separations as your HRIS probably calls them, is trending higher and higher.

Here's the chart, and then (of course), some FREE commentary from me:

Source - BLS Jolts report Dec 2013

Some thoughts:

1. 'Quits' are a function of several factors, (personal circumstances, the magnitude of the jerkitude of your managers, people self-selecting out as not being in the right job, etc.), but most observers of the Quit rate on a macro level ascribe movements in the rate to worker's confidence in their ability to find another, and what they think will be a likely 'better', job.  The rate moving up, to a level that is approaching the pre-recession level, is a signal that overall job market confidence is rising.

2. So while you and many other HR/Talent pros are lamenting about 'hard-to-fill' jobs, simultaneously more of the workforce are thinking of themselves as 'easy-to-place'. I'm not sure how that apparent paradox will work out, (probably very differently depending on location, skills, etc.), but it is kind of interesting and amusing at the same time.

3. How you are thinking about and reacting to news of a good employee quitting is probably changing too. In 2008 or 2009, you might have reacted by thinking, 'What is she crazy? Where is she going to find another job with as good pay/benefits/cupcake Friday like we have here?'. Now? Probably you'd think more along the lines of 'Hmm... She's going to XYZ Corp? I wonder if she could bring me over there too.'

4. Last, while the Quit rate increasing kind of feels like it is a good thing, there is certainly some warning signs as well. For one, those recent quitters might find that their skills and experience are not in as high a demand as they figured, and thus end up spiking the unemployment rate in the short term, (as well as having to take a boatload of grief from people questioning their sanity for quitting a perfectly good job). They might find, even today, that keeping a job is much easier than finding a job. And increasing worker confidence might put pressure on companies to increase wages, which can also have a detrimental effect on growth and profits.

So take a look at the JOLTS report if you are interested in this kind of data, I think it gives a little more color and depth to the more widely reported headline of the total rate of unemployment.

Are you seeing an increase in 'quits' in your shop?

Ready to quit yourself?

Have a great Wednesday!

An aging workforce case study: When clowning isn't cool anymore

I've posted a few times over the last year or so on the blog about the really interesting and important demographic changes happening in the American workforce. Mostly, these changes break down into two, related areas. One, the workforce and the population overall is aging. And two, the overall US labor force participation rate is falling, due in large part to the increasing number and pace of retirements of baby boom generation workers.

But those posts of mine I've linked to above, and honestly most of the 'Econ' type articles on these trends (and their implications for workplaces, companies, and policy), tend to be pretty dry and mostly academic and not really the kinds of pieces that really make anyone think for more than a minute or two about them. Bar charts with fancy shading or graphs with some trend lines can only move you so much. None of seems all that real if you get my meaning.

So for this re-set and take on the aging workforce and what it might mean for you, instead of dropping another chart and trying to convince you that this stuff matters, I want to point you to a short, but fascinating piece from the NY Daily News titled National Clown Shortage May Be Approaching, Trade Organizations Fear that illustrates just how these trends are playing out in the real world, (if 'clowning' could be considered the real world that is).

Turns out there aren't enough people, especially younger people, taking up professional clowning as an occupation. Check some quotes from the NYDN piece:

Membership at the country’s largest trade organizations for the jokesters has plunged over the past decade as declining interest, old age and higher standards among employers align against Krusty, Bozo and their crimson-nosed colleagues.

“What’s happening is attrition,” said Clowns of America International President Glen Kohlberger, who added that membership at the Florida-based organization has plummeted since 2006. “The older clowns are passing away.”

“The challenge is getting younger people involved in clowning,” said Association President Deanna (Dee Dee) Hartmier, who said most of her members are over 40.

“What happens is they go on to high school and college and clowning isn’t cool anymore,” he said. “Clowning is then put on the back burner until their late 40s and early 50s.”

Right there, in the micro-micro world of professional clowning you can see just about all of the major issues with much wider swaths of the workplace and jobs landscape today.

The job has been around a long time, but kids don't see it as cool anymore, and not enough of them are entering the field.

The incumbents are all getting older, retiring, even dying off and shortages are manifesting.

But the job, believe it or not, has higher standards for entry than in the past, so at the same time that interest in the field is falling, the barriers to entry are rising. And customers, the end customers I mean, are demanding more and more for thieir dollar. According to Ringling Bros. Director of Talent David Kiser, “Our audience expects to be wowed. No longer is it good enough to just drop your pants and focus on boxer shorts.”

Ok, at this point, if you have not already bailed out, I want you to think past the scary clown shortage, and consider the roles and people in your organization.

There is almost no doubt you have some of these kinds of 'clown' roles in your shop - ones that are important to the business, but for some reason do not attract enough of a pipeline or candidate flow to sustain once the incumbents trail off. But at the same time as these jobs get more important and pressing to fill, business or technology changes make the qualifications you are looking for even more difficult. Finally, these are still 'clown' jobs after all, they are not the best paying, most socially desirable kinds of gigs.

Oh, one last thing - in the 'If my suitcase doesn't show up in baggage claim within 5 minutes of touching down I am going to tweet about how terrible this airline is' age of the social media enabled customer, the demands for service and performance of this clown role (that you can't fill) are just getting worse.

Maybe not today, maybe not tomorrow, but soon I think, you will have to face the same kinds of challenges that are facing the circuses. 

What are you going to do to prepare for when (Insert whatever it is your company does) isn't cool anymore?

CHART OF THE DAY: The Labor Force in 2022

...will be older, (relatively smaller), more non-white, and will certainly have more robot participation...

First, here is the chart, courtesy of our friends at the Bureau of Labor Statistics:

And below are the key findings from the aggregate data presented in the chart above, as well as in the details on gender, ethnicity, and sub-age group data (all found from the BLS in a piece titled "Labor force projections to 2022: the labor force participation rate continues to fall").

The Bureau of Labor Statistics (BLS) projects that the next 10 years will bring about an aging labor force that is growing slowly, a declining overall labor force participation rate, and more diversity in the racial and ethnic composition of the labor force.

The labor force participation rate increased in the 1970s, 1980s, and 1990s and reached an all-time high during the 1997–2000 period. The rate declined during and after the 2001 recession before stabilizing from 2004 to 2008. The labor force participation rate fell in 2009 and continued to fall after the 2007–2009 recession ended. As the baby-boom generation ages and begins to retire, BLS projects that the overall labor force participation rate will continue to decline to 2022.

During the 2012–2022 period, the growth of the labor force is anticipated to be due entirely to population growth, as the overall labor force participation rate is expected to decrease from 63.7 percent in 2012 to 61.6 percent in 2022.

There is lots more in the details from the BLS piece, but I think you get the gist. And if you have been following this trend for any amount of time, you are probably not really surprised by the data.

What is surprising, at least to me, is that whenever a new monthly employment report is released by the DOL that the talking heads on the business news continue to lament the low (and declining) labor participation rates, and speculate on the reasons why and the potential policies that could reverse this trend.

If these 2022 projections from the BLS are accurate, or even close, I wonder if it makes more sense to quit trying to bring back the days of 2000 or so, and instead focus on what a smaller, more diverse, and older labor force means to our organizations and our economy.

No fiscal program is going to turn back the clock for all the aging boomers. And hardly any feasible rise in the minimum wage is going to convince more 16 - 24 year olds that they would be better off working more and going to school less.

The only age groups where participation is increasing are 55+.

Keep that in mind this year as you are working on your 5 - 10 year business plans.

Happy Wednesday.