July 2, 2013 · 4:30 am

High Cost of ‘Mal-employment’

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Professor Andrew Sum from the Center for Labor Market Studies at Northeastern University has done a great deal of research on the effect of the most recent recession on the youngest cohorts in our economy.  (I wrote about other of his research here.)

A recent CNNMoney article highlighted some interesting data from Dr. Sum’s most recent research efforts. And it has to do with the ability of recent college graduates to enter the economy in jobs that require their degrees.

Recent college gradsWith unemployment still above 7%, it’s not hard to understand that young people armed with a newly minted degree and little experience are having a hard time connecting to jobs. People with degrees and lots of experience are having a hard time connecting to jobs.

While we know that the data regarding the lifetime earnings differential for college graduates is a compelling argument for college attendance, the “mal-employment rate” together with the student debt-load most graduating college seniors are burdened with might be making young people have second thoughts about investing in a four year degree. And that’s bad news.

The Lumina Foundation tracks our progress towards attaining the national goal that 60% of Americans obtain a high-quality postsecondary degree or credential by 2025. And in 2011, the last year for which the data are complete, the percentage of Americans between the ages of 25 and 64 with two- or four- year college degrees was 38.7%. Our goal is 60%. Our current level is 38.7%. That’s really bad news.

Add to this the expectation that 65% of U.S. jobs will require some kind of postsecondary education by 2020 – and it’s really, really bad news.

These are difficult data points at the intersection of jobs, education and the talent pipeline. And they should be motivating us – all of us, in or out of HR – to think better about our workforce. Our organization’s workforce and our nation’s workforce.

Mal-employment might be the least of our worries in 2020.

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June 25, 2013 · 4:30 am

The Hidden Job Market is Alive and Well — and That’s Not Good News!

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Last week I wrote about matching the number of job openings to the number of unemployed people by industry. The numbers were arresting. I used data from the Economic Policy Institute’s Heidi Shierholz.

In that post, Unemployed Workers Still Far Outnumber Job Openings in Every Major Sector, Shierholz provided this graph showing the Job-Seekers ratio from December 2000 through April 2013 based on data from the BLS JOLTS Survey and Current Population Survey:

Not enough jobs to go around June 2013

This is an incredible view of the last 13 years. The Jobs-to-Seekers ratio in December 2000 was 1 to 1.1:  pretty much full employment. The unemployment rate that month was 3.9%, which means that even people who didn’t want to work were working.

As I read the data, though, it looks a little odd:  the CPS (Current Population Survey) and the JOLTS Survey together show that in April while there were 3,737,000 reported job openings, 4,425,000 workers were hired and 4,279,000 workers were separated for a net employment increase of 146,000. Which means that  688,000 more workers were hired than there were job openings. Even if these April hires were from the March job openings (3,875,000), there were still 550,000 more hires than openings.

So the hidden job market must be alive and well if we’re hiring more than half-a-million more workers than there are reported openings. Think about that. And think about the reported skills shortages. And think about the difference between structural and cyclical unemployment (which I wrote about here).

The reason our unemployment rate continues to stay at an unacceptable and economy-stopping 7%+ may not be so related to the lack of new job creation – we appear to be filling more than the reported number of job openings every month! – but to the scarcity of specific skills and talent. So maybe the skills gap is real and the 9,000,000+ workers who are unemployed will stay that way until they acquire new skills or further lower their job targets.

Either way, that’s not good news for employers with openings they can’t fill, workers who can’t find jobs for the skills they have, or our economy which can’t get out of 2nd gear.

The hidden job market is very much alive. Too bad that’s not good news.

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Filed under Bureau of Labor Statistics, China Gorman, Data Point Tuesday, Hidden Job Market, HR Data, Job Creation, Structural Unemployment, Unemployment Rate

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June 18, 2013 · 4:30 am

Forget the Skills Deficit: How About Filling Open Jobs?

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So the unemployment rate went up a little in May, from 7.5% to 7.6%. The Bureau of Labor Statistics deems this increase as “essentially unchanged.” Despite 175,000 more people working. How does this math work?

I’ve written about the how the unemployment rate in the U.S. is determined here and here. But here’s another slice of data to consider. It’s the number of job openings. The Job Openings and Labor Turnover Survey (JOLTS) published each month alongside the unemployment numbers, shares really interesting data each month. Along with the data about quits and hires, are data about job openings. Fascinating. Really.

JOLTS June 2013

So, although there were 3,757,000 job openings in April (down 118,000 from March, or “little changed” as the BLS describes it) the difference between hires and total separations was just 146,000 month over month. So on the surface, a net of 175,000 new jobs is curious.

More curious is matching the number of job openings to the number of unemployed people by industry. Economist Heidi Shierholz published a piece for the Economic Policy Institute last week that shows in stark relief that unemployed workers still significantly outnumber job openings in every major sector.  Based on analysis of the JOLTS and other data, the following chart is a snapshot of current job openings numbers by industry and the numbers of unemployed workers in those industries. It’s rather eye popping and raises lots of questions.

Unemployed far outstrips available jobs June 2013

Ouch! So think about this data when you read about employers not being able to find the right skills for their openings. Is it really skills they can’t find? Or something else? How hard are they looking? What BFOQs are they using that overlook millions of job seekers?

Curious, yes?

There are so many data points around employment, job openings, quits, hires, workers, unemployed workers, discouraged job seekers, skills, education levels, education spending… The data points come from bonafide sources (like the U.S. Bureau of Labor Statistics and  the Georgetown University Center on Education and the Workforce), quasi bonafide sources with bias (like the Economic Policy Institute, SHRM, U.S. Chamber of Commerce and AARP), vendor sponsored research and white papers, and millions of blogs and other media sources.

Lots of sources. Lots of data points. Lots of analysis. Lots of conflicting findings and conclusions.

The best we can do is be pro-active in finding sources that are transparent about their data and analysts who seem unbiased. And then be persistent in looking at all sides of an issue and smart in believing what you read.

On the issues of skills, jobs and unemployment, though, it seems that we don’t know what we’re doing. We may not even really know what the truth is. Except this:  we’ve got to do better at matching job openings with available talent. It’s clear that we haven’t figured this out. Not government, not business/employers, not education providers, not workers, not vendors, not recruiters.

Forget the skills deficit. What about filling the open the jobs?

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Filed under Bureau of Labor Statistics, China Gorman, Data Point Tuesday, Economic Policy Institute, Employment Data, HR Data, Job Creation, SHRM, Skills Shortage, Structural Unemployment, U.S. Department of Labor, Unemployment

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#SHRM13 is underway

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Fareed Zakaria is the opening keynoter on the big stage at SHRM’s Annual Conference in Chicago.

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June 16, 2013 · 1:58 pm
June 11, 2013 · 4:30 am

Careers and Learning: a New Reality

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This, from Kelly, really hits the nail on the head:  “The last two decades have radically altered the way skills are acquired and developed. Skills are no longer “front-end loaded” onto a career. Rather, they are characterized by lifelong development and renewal. Most skill sets have a finite life.”

Skills are no longer “front-end loaded” onto a career.

But who recognizes this really? Employers who lament that they can’t find the skills they need in the workforce? Students who report being less than adequately prepared to enter the economy? Unemployed workers who can’t connect to a new employer?

Most skill sets have a finite life.

This has never been truer than today – and the “lives” will be getting shorter and shorter.

In their recent Global Workforce Index™ report, Career Development and Upskilling, Kelly looks at survey data from 120,000 people (workers, presumably) in 31 countries and has some very interesting data to share.

For example, most workers believe they are proficient in critical “soft skills” but Bilingual skills, Leadership/initiative and Creativity/innovation were all seen as needing development. Employees believe this of their skill sets. And most business leaders would not argue with these areas of deficit. Of note, however, is the belief on the part of employees that they have good mastery over the most critical “soft skills.” If true, perhaps learning budgets (such as they are) could be better deployed. If untrue, some challenging performance conversations need to be held!

Kelly Global Workforce Index April 2013 Critical SkillsOf course, in terms of the skills gap, most attention is being paid to STEM workers.  Interestingly, these workers believe that their proficiencies in the most important skills sets of Analytical/critical thinking, Evaluation, analysis and troubleshooting, and Complex problem solving are solid (no lack of self-esteem in this group). Where they might need development are in the more complex technical side of things: systems, computer, software and mathematics, calculations, measurement and monitoring.

Kelly Global Workforce Index April 2013 Critical STEM SkillsIf lifelong learning really is the reality, then self-driven learning will be key.

And if self-driven learning is key, then a realistic assessment of current skill levels and actual skill gaps will be critical. For everyone:  employers, employees, learning providers – everyone!

These observations based on their survey responses seem common sense and almost obvious. Almost. I think most business leaders – and HR professionals in particular – would agree with Kelly that skills are no longer front-end loaded onto careers. They’d also agree that most skills have a shelf life.

But it doesn’t appear that we’re approaching the answers to the skills gap as a systemic shift in the nature of careers. We’re approaching it as a simple supply vs. demand dynamic – if we approach it at all. Perhaps this data can shift the conversation and approach to a more useful and motivating discussion:  the nature of careers has shifted and so the nature of education and employment needs to shift as well.

Then we might make actual progress in addressing the perceived mismatch between the jobs available and the skills in the existing talent pool.

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Filed under Career Management, China Gorman, Data Point Tuesday, HR Data, Kelly Global workforce Index, Kelly OCG, Skills Gap, STEM

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June 4, 2013 · 4:30 am

Deeply Disengaged

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DeeplyDisengaged-thumb-300x295-177582Last week a guest poster wrote an anonymous letter that was posted on the U.K. ExpertHR blog. This U.K HR professional is “at the end of their tether” and writes a very transparent and poignant piece about the reasons for their massive professional disengagement and personal sadness at their lot. The publishers suggested that others might respond with guidance for the writer and the responses were numerous and detailed. The post and its responses created a robust and fascinating discussion.

And everyone – except one responder – totally missed the point. Totally. The discussion focused on whether or not Deeply Disengaged should “stay and fight” or quit and find a more conducive employer. Ugh!

Deeply Disengaged says that their “work every day is focused around making the workplace a better place to be for employees… To me, ensuring people are at the centre of everything you do is fundamental to being successful in all other areas. It is the foundations on which everything must be based.”

But the bottom line of the post is this:  “The powers that be don’t value the work that I am doing.” The old (ugh) furniture lament. (See my post here if you aren’t familiar with the furniture lament.)

I’ll bet it’s true. I’ll bet the powers that be don’t value the work that Disengaged is doing because Disengaged don’t know the value of the work they’re doing.

So here’s the real, hard truth – for Deeply Disengaged and all the responders:  HR needs to be focused on making the organization more efficient and productive leveraging the organization’s most costly resource, people. HR’s work needs to start with the organization’s strategic and business plans and deliver solutions that enable the successful growth of the enterprise. In other words, HR needs to be focused on the business!

Deeply Disengaged lists a number of supposed outcomes from his/her work:

  • Feedback is now two-way and things are improving fast
  • Retention of employees has increased significantly
  • Retention of candidates in the recruitment process has increased
  • Speed of work output and completion has risen
  • I could talk and talk about the things I am doing and results that we have seen but you get the picture…

I have to take a step back and say, Really? You wrote some nice stuff there, but nothing quantifiable.

I have to take a step back and ask, how do you know your outcomes if you don’t (or can’t) quantify them. And if you can quantify them and you don’t talk about them, why would a business leader listen to you?

I’m skeptical because in the entire post there was not one number. Not one. How can you talk about the value of the work you’re doing without numbers? Seat at the Table NotWithout percentages of increase or decrease, without dollars (or in this case, pounds)  saved, without numbers of days saved…

And that’s the challenge for HR – all over the world:

  • To leave behind “banging on about how these areas can hit the bottom line” and focus instead on providing clear, evidence-based business cases that are linked to the strategic plan.
  • To leave behind doing things “because I believe it can and will make a difference” and start doing things that the business requires and be able to prove it with data – including numbers.
  • To leave behind being “focused around making the workplace a better place to be for employees” and leading the effort to ensure the culture and values actually enable the achievement of the strategic plan.

I’ll bet that Deeply Disengaged is more of a business thinker than they know. If they really are working on improving business processes and outcomes the way they describe, they must know something about how business works, how business leaders speak, how business decisions are made and how resources are distributed. The question becomes, why aren’t they stepping up to the plate to act like a business leader with deep HR expertise rather than the disrespected HR functionary that the organization has to put up with?

It’s a troubling question. And frankly, it’s one of the reasons I started the Data Point Tuesday feature here at http://www.chinagorman.com. To provide data- and research-based sources that will help HR professionals move up from HR functionary to business leader with HR expertise.

I feel for Deeply Disengaged. Being disrespected is the pits. But quitting is not the answer – because the same thing will happen in the next job, and the next, and the next. Until the perception of HR professionals as functionaries changes to business leaders with HR expertise, this won’t go away. And the only way to change that perception is for HR professionals to start to behave like business people, to speak the language of business people, and to become comfortable with numbers, data and research. The only way for Deeply Disengaged’s experience to change is for them to start to behave like a business person.

It’s not easy – but it’s also not hard. Because I truly do believe that most HR people really can be business people — because they do know business. They just aren’t comfortable with that. Yet.

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May 28, 2013 · 4:30 am

Is HR Still in a Bad Mood?

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This was a popular post from last year at this time and I’m wondering if HR is still in a bad mood…

Results from The Fifth Annual Talent Management Study by Knowledge Infusion and Human Resource Executive® were published recently in HR Executive by Mike Brennan and some of the findings were surprising.

I didn’t find it surprising that 63% of the respondents report that they have trouble filling jobs and that they can’t find the right candidates. That’s been reported frequently.

It also doesn’t surprise me that more organizations than not will be increasing their investments in Learning/Development, Performance/Goal Management and Workforce Analytics/Planning services and technology. That’s obvious.

What really does surprise me is that 58% of HR executives believe that peer leaders in their organizations “do not buy into talent management.”

Lordy, I hope this isn’t the furniture conversation. And I’m willing to believe it isn’t because 83% of the respondents also believe that “many of our managers do not know how to manage people.” Additionally, 65% of the respondents believe that “many of our HR generalists/business partners are not equipped to consult with the organization on talent.”

Ouch. Either the HR respondents to this survey were all in a colossally bad mood, or they’re starting to look clear-eyed at their organizations and re-calibrate their challenges.

It’s clear that many organizations need to look at legacy systems and programs in the talent management arena (can you say annual performance review system?) and, according to this survey, they are. But focusing on leadership understanding and managerial effectiveness in talent management might be a strong first step.

It’s a great day for HR if the results of this survey mean a new focus on talent management effectiveness – at the top, in the middle, and most importantly, in HR.

But if it was just a systemic bad mood, we’re sunk. Because, in the words of one of my favorite movie characters in one of my favorite movies, “we have serious problems to solve, and we need serious people to solve them.”

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May 21, 2013 · 4:30 am

Tech Professionals’ Pay by the Numbers

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Dice, the career site for technology and engineering professionals, published their annual Tech Salary Survey in January. And as Chairman, President & CEO of Dice Holdings, Inc., Scot Melland observed, “The fact is you either pay to recruit or pay to retain and these days, at least for technology teams, companies are doing both.” The constant being pay.

According to the responses of 15,049 employed technology professionals between September 24 and November 16, 2012, tech professionals have garnered the biggest pay raise in a decade. The survey report is highly consumable and I recommend it to anyone involved with hiring or managing technology professionals.

The contents include:

  • 10-year trend in tech salaries
  • Salary by employment type
  • Bonus trends
  • Salary by metro and region
  • Tech employee motivators
  • Tech salary satisfaction
  • Salary by industry
  • Salary for high paying skills
  • Average salary by experience and education level

The last section, average salary by experience level, is eye popping. Check it out.

Dice Tech Salary Survey Education Level Salaries 2013-2012

First of all, we can tell by these salaries that STEM education pays off from a career opportunity perspective.

Second, we can tell by these salaries that the market perceives low supply.

Third, look at the high school graduates’ salary vs. vocational/tech school and some college salaries. What’s up with that?

Fourth, the year-over-year change in the salaries of military veterans vs. every other category is head snapping.

Let’s look at these observations.  First, I think we can all agree that there’s no downside to focusing on STEM education. No downside for employers who perceive low supply and no downside for employees whose lifetime earnings are among the highest.

Second, supply vs. demand economic principles seem firmly in charge of these salary trends. We can debate whether or not there truly are skills shortages in the marketplace today. But it seems clear that the market believes there is a shortage and is paying accordingly.

Third, as we consider the counter-intuitive data showing high school graduates earning significantly more on average than votech grads and some college/associates’ degree holders, we might be seeing generational effects coming in to play. More recent high school graduates may have more current hardware and programming learning than those who attended the votech programs of the 1970’s, 1980’s and 1990’s.  Certainly with the ability to connect to communities of interest via the social web, today’s high school students have a leg up on learning that their parents never had. Additionally, while employers aren’t spending the money they used to on internal training, technical training programs continue to be present.

Fourth, it appears that military veterans with current technology skills can enter the market at higher levels and command higher salaries. And I think we’d all agree that this is a very good thing.

This is a very useful snapshot of the salary landscape for a portion of our employees. Wouldn’t it be interesting to see the same data for other functional skillset areas? Like marketing, finance, or even HR?

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May 14, 2013 · 4:30 am

Onboarding: Not Rocket Science

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As HR and other leaders grapple with high turnover rates among the Gen Y cohort (see last week’s post here), all kinds of issues get raised. Is the turnover due to “special” characteristics inherent in Gen Y? Is the turnover due to lack of education and training opportunities? Naivete on the part of Gen Y – the world of work doesn’t match their expectations? Could a lack of thoughtful onboarding play a part?

The Aberdeen Group published Onboarding 2013: A new Look at New Hires last month and author Madeline Laurano provides data that might help organizations become more effective in retaining the youngest of their workforce.

First of all, Aberdeen reports that only 37% of employers have invested in a formal onboarding program for longer than two years. Surveys report that it’s difficult to quantify the ROI on formal onboarding programs so “basic orientation” activities are used in substitution. Socializing new hires into the organization’s culture is popular, but hard to measure. And so, “onboarding programs have fallen short and become little more than a transition from recruitment to employee development.” Interesting.

But attention is starting to be paid and, surprise!, it’s all about productivity. One of the quickest routes to ROI is the improvement of productivity and that’s something organizations can measure. Other drivers for looking at new ways to onboard new hires include improving employee engagement, reducing turnover and improving new hire assimilation.

But, as the graph below shows, there’s lots of opportunity to make onboarding programs more robust, strategic and productive by spending more time.

Aberdeen Group Onboarding 2013 Fig 3

And it doesn’t have to be rocket science! The kinds of strategies being used to drive stronger onboarding programs include the following:

  • Creating new hire checklists
  • Introducing new hires to the go-to people
  • Providing forms to new hires before day one
  • Ensuring compliance on all new hire forms
  • Creating peer networking opportunities/events

But the real key appears to be creating a bridge from the candidate experience to learning/development and performance management. After offer acceptance, Best-in-Class employers are more than twice as likely than all other organizations “to integrate data from onboarding into performance management, providing key stakeholders with development plans of new hires and to tie the source of a candidate to their performance as an employee.”

Aberdeen Group Onboarding 2013 Fig 11

But still, only 26% of Best-in-Class employers enroll new hires in learning and development programs compared to 11% of all others. Hmmm….

Laurano concludes the report with recommended actions for employers in Best-in-Class, Average and Laggard categories. For the Average and Laggard categories they are not rocket science. For the Best-in-Class category, a little rocket science might be involved.

Laggard Steps to Onboarding Success

  • Establish a clear owner
  • Provide strong visibility
  • Extend the onboarding process

Industry Average Steps on Onboarding Success

  • Align onboarding with learning initiatives
  • Define metrics in advance
  • Invest in onboarding technology

Best-in-Class Steps to Onboarding Success

  • Consider gamification
  • Include cross-boarding
  • Balance tactical and strategic elements

Think about these as you and other leaders in your organization wrestle with the high turnover rate in your Gen Y employees. And take a look at this report.

Aberdeen Group reports are very easily consumed. They’re written in normal English and have an easy to understand structure. Even if you can’t spend real money to make your onboarding program more productive, you can certainly get smarter about what works and make some adjustments based on data to improve your outcomes. That’s the whole point of research, right?

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Filed under Aberdeen Group, Candidate Experience, China Gorman, Data Point Tuesday, Gen Y, HR Data, Onboarding, Turnover

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May 7, 2013 · 4:30 am

Gen Y’s Self-fulfilling Prophecy

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Accenture recently published its 2013 College Graduate Employment Survey Findings. Lots of great data. Especially if you plan to hire recent college grads. In fact, some of the data are surprising.

One of the important takeaways is that employers have unrealistic expectations for the skills of the hires they make out of college. They think these young people should be able to hit the ground running and are surprised and disappointed when they don’t. And to compound the problem, these employers are not investing in training initiatives to get the newly hired up to speed in the short term or effective in the long term. This is all pretty logical. It’s good data and if you plan on hiring entry level employees from the ranks of the newly graduated, you should read this.

But here’s what caught my attention. It’s about the willingness to commit. And it isn’t the first time I’ve seen data like these.

Young people, entering the economy for the first time, want to commit to their employers. It’s not what we expect, I know. We expect these youngsters to be gone in the career equivalent of sixty seconds. And sometimes they are. But it’s important to know that that isn’t what they want! This isn’t what they expect!

From Accenture:  The class of 2013 is expecting more career longevity from their first jobs:  68% of pending 2013 college grads expect to be at their first job more than 3 years compared to 49% of 2011/2012 college grads.

Accenture career longevity in first jobs 2013

And from the Achievers Class of 2012 white paper:

Achievers Class of 2012 White Paper

In this survey, more than 70% of 2012 college graduates expected to be with their first/next employer 3 years or longer — and 48% expected to be with their first/next employer 5 years or more. Surprising, right? Not what we expect, right? Not what we “know” about Gen Y, right?

But the BLS shows us what happens once they join our organizations:

BLS years of tenure by age

So, young people entering the economy for the first time with a newly minted degree are filled with optimism and have every intention of committing to their first employer for 5 years or more. Is it naivte or is it a real desire to commit, belong and make a difference?

And what happens once they start that first job that impels them out the door in 18 months or less?  Are employers so inept at selection that they really can’t hire employees that will persist? Are young people so naïve that they don’t really know what they’re signing up for and leave when reality doesn’t match expectations? Or, as the Accenture survey suggests, are young people disappointed when expected training and development doesn’t materialize and they leave in search of greater learning opportunities?

Clearly this is a complex issue with lots of dynamics, as the Accenture survey results show. However, if we started with the belief and understanding that young people really do want to engage and commit to their employer, would we be more likely to invest in developing their skills?

If we started with the belief and understanding that young people really do want to engage and commit to their employer, would we create onboarding processes that ensure expectations – on both sides – are being understood and met?

If we started with the belief and understanding that young people really do want to engage and commit to their employer, how would we approach them differently?

I suspect that most employers believe that there’s no return in investing in a talent pool that will be gone in 60 seconds.

I further suspect that the EVP that is sold in the recruiting process doesn’t exactly come to life once the recruit joins the organization.

But I suspect that the real issue is that Gen X and Baby Boomer managers, supervisors and recruiters believe all the negative stereotypes about Gen Y and their lack of commitment to any agendas other than their own — despite multiple data sources that show just the opposite. And we’ve ended up in this tough reality that has become a full-fledged self-fulfilling prophecy.

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Filed under Accenture, Achievers, Baby Boomers, Bureau of Labor Statistics, China Gorman, Data Point Tuesday, Employee Value Proposition, Gen Y, GenX, HR Data, Turnover, U.S. Department of Labor

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