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    Entries in labor (72)

    Thursday
    Jan112018

    CHART OF THE DAY: The Changing Composition of the US Workforce

    There are only two websites you need. Actually three, if you count this one. And hint, none of them are Facebook. I promise you that one day you will regret all the time you wasted with Facebook. But I digress.

    One is BLS.gov, the Bureau of Labor Statistics site where all the employment, industry, productivity, time use, compensation (and more) information you need on the US labor force is located.

    The other is the Federal Reserve of St. Louis' fantastic FRED site, where you can download, graph, and track over 500,000 data series covering the economy, employment, demographics and much, much more. Data geeks like me can get lost in the FRED site for hours.

    I was using these two sources to update my notes and perspective on US aggregate employment across industry groups, useful information that helps me guide and shape the specific industry focus that results in both the content for this blog, topics for the HR Happy Hour Podcast, and the program for the HR Technology Conference.

    This data is also useful to consider in a larger sense - like when thinking about governmental policies and investments, the focus of secondary and higher education and training, and even when answering questions like 'Just what is our country good at?' from a business/economy perspective.

    Have a look at today's Chart of the Day - (built at the FRED site) aggregate US employment since 1980 in the largest category components of the labor force, then some comments from me..

    We all know that 100 - 120 years ago the US shifted from a largely agricultural economy/labor force to a manufacturing, shipping, and trading workforce. And then, slowly but surely, beginning in about 1980, a shift started to occur. Manufacturing employment began to decline while professional services, health care, and retail began to climb.

    Here's the snapshot of latest employment numbers for the categories in chart, (Nov 2017).

    Manufacturing, while pretty apparent to most casual labor market observers, has fallen below professional services, health care, leisure and hospitality, even retail employment in terms of its overall share of US employment. For some perspective, as of November 2017 total US non-farm employment was about 149 million. At that level, manufacturing now represents only about 8.5% of US employment.

    In terms of where most observers see these trends continuing out into the future, the aging US population seems to clearly indicate that health services and health care will be the largest growth area moving forward. Retail jobs are under threat from automation, online shopping (and the efficiencies and lower labor costs associated), and by the constant chase for less expensive goods produced and shipped in lower cost countries. The same threats also impact manufacturing. Even the largest, new manufacturing plants require far fewer workers than the ones of just 10 - 20 years ago.

    There's lots more to think about when looking at this data. I encourage anyone interested to join me in a deep dive on BLS.gov and the St. Louis FRED.

    Thursday
    Dec142017

    Code words for 'Get ready for some layoffs', ranked

    Big news on the corporate M&A front announced this morning with the news that Disney has reached an agreement to acquire substantial portions of the Fox media empire (including Twentieth Century Fox film and TV studios, a bunch of cable and international TV businesses), for approximately $52.4B in Disney stock.

    While most of the coverage I read and heard this morning focused on the business and content strategy implications of the deal (basically these assets strengthen and augment Disney's content inventory for their eventual direct to consumer streaming service which will compete with Netflix), less attention was given to the inevitable 'people' costs of these kinds of transactions. Namely, the almost certain reductions in headcounts from the newly combined (and larger) entity as execs look for ways to try and pay for the huge acquisition cost, and wring more profit and efficiency from the combined entity.

    And the fun part (it is not really fun, I am being sarcastic), is that when the 'people' issues are discussed in these M&A deals the word 'layoffs' is never, ever used. No, we get other, less direct and more corporate-speak words and phrases that more or less try to mask what is really going to happen to a whole bunch of people that through no fault of their own become part of the costs (ironically savings to the corporation), of these transactions. This topic will always resonate with me because a few years back I was caught on the wrong side of one of these transactions myself.

    In that light then, I present my unscientific, unresearched, incomplete, subjective, and 100% accurate ranking of 'Code words for 'Get ready for some layoffs''...

    5. More than one appearance in a Press Release of any of the following words - 'Nimble', 'Optimize', 'Simplify', 'Align', ''Strategic', 'Targeted', (I could keep going but you get the idea). The key is the more corporate buzzwords you see, the more you need to worry.

    4. 'Refocus', 'Restructure', or for a modern spin 'Pivot to (insert something slightly different from what the company has been doing here)' - The 'Pivot to' something else one is my new favorite. Somehow most corporations equate 'trying something new' with 'get rid or everyone who was doing the old thing'

    3. 'Cost savings from efficiencies' - this phrase is actually used in the Disney-Fox press release. But be certain that most of these cost savings will come from the fact that the new entity won't need separate administrative and back office functions. Running payroll for 12,000 employees isn't that much more labor intensive than running it for 9,000 employees.

    2.'Rightsizing' - Ever notice that getting the company sized 'right' always means 'making the company smaller?'

    1. 'Synergies'- Any time 'synergies' are mentioned anywhere in the Press Release, time to polish up your LinkedIn profile 

    Of course you could disagree with these rankings, but sadly, you would be wrong.

    Happy Thursday. Hope you don't get M&A'ed before the holidays.

    Thursday
    Nov302017

    It doesn't matter if the robots aren't coming for your job, they are coming for your neighbor's job

    After reading a flurry of pieces over the last few days about the progress being made in self-driving vehicle technology, I was reminded that one job category that seems likely to be highly pressured by this type of automation is commercial vehicle driving. You don't have to be a genius to realize that once Tesla (and others), get enough of their new commercial trucks into service, that Generation 2.0 of these trucks will attempt to not just eliminate diesel fuel and noxious emissions from their products - they will try to eliminate the driver too.

    And you probably caught something about Amazon's newest experiments with retail stores that have no cashiers. Or maybe you have heard about fast food giants like McDonald's or Panera pushing more self-service kiosks into their locations, to reduce the need for human cashiers and order-takers. Or the hotels that are using mobile robots to deliver room service meals to their guests. And the list goes on and on.

    And maybe after reading all these stories you say to yourself: "Self, these technology advancements are amazing. But good thing I am a (insert the white collar 'knowledge' job you have here) and not a truck driver or a cashier.' 

    And whether or not the robots are coming sooner or later for whatever 'knowledge' job you have today is probably debatable, let's pretend for the moment in the words of Big Brother, (yes, I am fan), - 'Knowledge worker X, you are safe'. Phew. That is a relief.

    But here is the thing, the kinds of jobs that are most vulnerable, most likely to be adversely impacted by automation are ones that are held by millions of people. Have a look at the chart below, from BLS data from May 2016.

     

    Look closely at that list of the Top 10 'most-held' job categories in the US and think about which of them, (Clue: It is almost all of them), are going to be increasingly pressured by technology, automation, and 'self-service'.

    There are about 150M people in the US labor force give or take. The Top 10 job categories in the above chart represent about 21 or 22 million workers - roughly 15% of all US workers. That is a huge number, especially considering that half a percent or a full percent moves in the unemployment rates are such big news.

    The potential and the consequences of labor automation are concerns for everyone - whether or not your job is 'safe'.

    And one last bit of food for thought. This issue, this challenge of automation and technology threatening jobs is also going to be a local one. Check out this chart below that shows the largest private employer for each state in the US. See any cause for concern?

    When Walmart decides to move more aggressively into online, self-service, robot customer service pods, and Amazon-like efficiency in their distribution centers there will be an impact too.

    But that's ok. You don't work at Walmart.

    But I bet you know someone who does.

    Friday
    Oct272017

    What do you think you know about job hopping?

    Probably my favorite movie of the last few years is The Big Short, the adaptation of the Michael Lewis book detailing the run-up to the financial crisis/meltdown in 2007 - 2008.

    If you have not seen it, take some time this weekend and do so, you will be glad you did.

    But why I bring it up is that the movie opens with an on screen quotation, which is attributed to Mark Twain and that reads as follows:

    It ain't what you don't know that gets you into trouble. It's what you know for sure that just ain't so.

    If you know the story of The Big Short you'll know why the Twain aphorism resonates. Again, take some time this weekend and catch the film if you haven't.

    But back to the point, or, rather, here's the point I want to make and why I thought of that quote this week.

    What do you think you know about job hopping? Meaning, do you think, as I suspect most of us do, that younger generations of workers, (younger Gen X, Millennials, etc.), are more likely to 'job hop', i.e., have shorter average tenures in their jobs than prior generations?

    I mean, that seems to be the convential wisdom, that the Millennials in particular have shorter job tenures, are much more likely than us older types were to leave a job that either is not working out for them, or for what they perceive is a better opportunity, and overall are less attached to workplaces and employers than we were in the past.

    Do you think that is more or less true?

    I admit, I did, (without ever looking it up), until I caught this piece in the Economist recently, Workers are not switching jobs more often. Here is a quick chart and excerpt from the piece:

    EVERYBODY knows—or at least thinks he knows—that a millennial with one job must be after a new one. Today’s youngsters are thought to have little loyalty towards their employers and to be prone to “job-hop”. Millennials (ie, those born after about 1982) are indeed more likely to switch jobs than their older colleagues. But that is more a result of how old they are than of the era they were born in. In America at least, average job tenures have barely changed in recent decades.

    Data from America’s Bureau of Labour Statistics show workers aged 25 and over now spend a median of 5.1 years with their employers, slightly more than in 1983 (see chart). Job tenure has declined for the lower end of that age group, but only slightly. Men between the ages of 25 and 34 now spend a median of 2.9 years with each employer, down from 3.2 years in 1983.

    And here is a quick chart showing tenure not really moving, at least at younger cohorts, over time.

    So yes, Milennials switch jobs more frequently than older workers. Younger workers have always switched jobs more frequently than older workers. The data shows that the phenomenon hasn't really changed much over the last 30 years.

    What's really striking from the chart is not just that the 25 - 34 age cohorts is basically exhibiting the same characteristics with respect to changing jobs than they did 20 or 30 years ago, but that the largest and steepest declines in job tenures are seen in the Men aged 45 - 54 group. That group's average job tenure has declined from 12.8 years in 1983 to 8.4 years by 2016.

    There are tons of possibly reasons for this, primarily how the events so well portrayed in The Big Short put so many of this group into unforeseen unemployment, as well as how technology, automation, and outsourcing have seem to affected this group more significantly than other labor cohorts.

    But that is a post for another day.

    The main reason this one stood out for me is that the data shows pretty clearly that what we think we know for sure, that Milennials are job hopping, low attention span miscreants, probably really isn't true.

    What else about work, and careers, and employees do we know for sure that might be, in the words of Twain, 'Just not so?'

    Have a great weekend!

    Thursday
    Oct262017

    CHART OF THE DAY: This labor market data point just hit a 44-year low (and low is good)

    It feels like its been awhile since I have busted out a new Chart of the Day post so what better to dust off the fan favorite feature than another look at one of my pet subjects, namely, the US labor market.

    While I have posted a ton of labor market charts over the years, I am pretty sure I have not talked about today's data point - Weekly Initial Jobless Claims. This data point is the total number of people making new claims for unemployment assistance for the weekly measurement period. And as you can surmise from the definition, lower is better with this metric. The fewer folks making unemployment claims the better.

    So here's the data, initial weekly jobless claims for the last 10 years or so, courtesy of our pals at the St. Louis Federal Reserve, then some comments from me after that. As always, my comments are absolutely free of charge but sadly, are non-guaranteed.

    The data please...

    Three quick thoughts about the data...

    1. The number of people filing for unemployment benefits for the first time totaled 222,000, the lowest since March 31, 1973. That's a long time ago. So long ago that the Knicks were about to win the NBA title in a few weeks.

    Lower initial claims leads to lower (over time) unemployment rates, fewer people truly out of work, and the need for HR and recruiting to essentially have to make two arguments when attempting to fill open roles. One, that the role itself presents the candidate great opportunity and value. And two, that the new opportunity and value somehow are better, more compelling than their current set up. Fewer and fewer of your candidates and prospects are going to be desperately seeking something new. You job continues to get harder.

    2. I know you, or more likely your CFO, won't want to hear this. But if you have persistently hard or long to fill roles you are working on, you have to sweeten your offering. And for the most part that means compensation. Fewer unemployed folks, more candidates already not sure they want to leave the good thing they have, and like the real estate market in San Francisco, potentially juggling multiple good offers. All that adds up to you left with empty chairs if you can't/won't compete on compensation.

    3. In a tightening labor market you know what else becomes important? Yep, retention. At the same time you are scouring LinkedIn profiles of people working at your competitors to see who you can poach, their recruiters are doing the same with your folks. What can/are you doing to strengthen your own value prop to try and build a moat around your best people? Because with each passing week, it is going to get harder and tougher to fill the spots of the faithful departed.

    When talent gets scarce, and their options multiply, the HR/recruiter role becomes that much more important in the organization.

    In fact, you might be getting offers yourself right now.

    Because in a really tight, competitive market the only thing that might be more valuable than talent to the organization are talented HR and recruiting people.

    Happy hunting.