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Articles - Publication Date 5.1.2003
The Next Crisis: Too Few Workers
Even as the U.S. economy struggles to recover from recession and manufacturing firms continue to thin their ranks, there's still talk of a skills shortage. No kidding. Here's what the experts are saying and what you can do about it.
By John S. McClenahen
Roger Herman is trying to get your attention -- to warn you of a looming shortage of skilled workers. U.S. manufacturing, which has shed about 2 million jobs during the last two years, faces a serious shortage of computer-literate and other technologically skilled workers, insists Herman, a business futurist and president of the Herman Group, a Greensboro, N.C.-based consulting firm.
Yet, across the U.S., manufacturing managers and senior corporate executives seem not to fully comprehend the situation or recognize the challenge that lies ahead. For example, in the consumer products business of General Electric Co., a multinational corporation known for its world-class management-development practices, the skills shortage that Herman labels an impending crisis is not even on the edge of the radar screen.
That's understandable -- to some extent. Under pressure from Wall Street to repair their balance sheets and improve short-term financial performance, many companies continue to focus on shedding workers and not on retraining existing employees or seeking skilled workers from outside their factory walls. "The less-savvy companies are saying, 'We don't have a problem; there are plenty of people on the street; we can relax our craze about retention,'" reports Beverly Kaye, founder and CEO of Career Systems International, Sherman Oaks, Calif. On the other hand, she relates, "the savvy companies are saying, 'It looks that way for now. But look around the corner.' "
Although they are less than precisely predictive, economy-wide data from the U.S. Labor Department give credence to claims of a coming skilled-worker shortage. Projections made by the Bureau of Labor Statistics in 2001 before the Sept. 11 terrorist attacks on the U.S. showed the economy able to support 167.75 million jobs in 2010 but anticipated only 157.72 million people being available to fill them. In other words, by the end of this decade there could be a 10.03 million-person labor shortage.
What's more, as U.S. manufacturers continue to shift unskilled and low-skilled work from domestic plants to plants in such places as Mexico, China and the Caribbean, "the manufacturing jobs that are going to be available are going to be more sophisticated than 'traditional' manufacturing sector jobs," states futurist Herman.
However, "if you are waiting to see if you have a problem, it's too late," warns Robert Spekman, a professor at the University of Virginia's Darden School in Charlottesville.
Shortages of skilled workers, in fact, already exist. Pharmaceutical firms in New Jersey, for example, can't find all the Ph.D.s, M.D.s and veterinarians they need. The consolidating and, at least until recently, profit-starved U.S. steel industry isn't attracting the graduate engineers it needs. And a just-released Accenture study shows manufacturing companies around the world generally trailing behind other firms in the percentage of workers who have the skills to achieve industry-leading performance.
In Peter Cheese's mind, a shortage of so-called knowledge workers, workers with good technical skills and management abilities, has been around for some time. And, says Cheese, the London-based global managing partner for Accenture's human performance consulting services, manufacturing company executives need to better measure and understand where their knowledge worker skill needs are greatest and focus on the development and retention of key people.
That job, he contends, will be complicated by the mindset of today's college graduates. Coming in at the bottom of a manufacturing company without the cutting-edge image of the high-techs and biotechs and advancing step-by-step over many years "is not typically what Generation Y is terribly intrigued by," he observes. They have a much faster moving set of demands and expectations."
For example, metallurgists and process engineers coming out of college and looking for jobs "don't look too hard at the domestic ste
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"If you are waiting to see if you have a problem, it's too late."
--Robert Spekman, University of Virginia
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