A PATH TO TALENT SUSTAINABILITY Why Education Programs are the Key to Avoiding Skill Gaps
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1 A PATH TO TALENT SUSTAINABILITY Why Education Programs are the Key to Avoiding Skill Gaps Not long ago, employers had the upper hand in the talent search. But times have changed. Today, retiring Boomers and a plummeting unemployment rate are creating fierce competition for skilled talent. How can you attract and retain the talent you need today and for the future?
2 By 2020, a shortage of approximately five-million employees with post-secondary degrees is expected 1 roughly the population of Los Angeles and Dallas combined. For the unprepared employer, the talent drought promises lingering job openings and revenue risks. To create a sustainable source of talent, employers will need to become less reliant on just recruiting from outside and more focused on strategically developing talent from within.
3 THE SEARCH FOR SKILLED HIRES Overall unemployment is already at near historic lows, dropping from 10% at the peak of the recession in 2009, to less than 5% in But the picture around skilled employees is particularly bleak. By 2020, 65% of jobs in the fastest growing occupations will require post-secondary training 1, yet the pool of available graduates is steadily shrinking. RATES OF UNEMPLOYMENT 4.6% 5.2% 2.3% National Rate High-school Graduates College Graduates 3
4 MANY IN THE C-SUITE ARE ALREADY TAKING ACTION For many organizations, the skills gap is not new news. In a recent survey 4, CEOs said they re not only focusing on their organization s potential for growth, they re already taking action in changing the way they develop employees. 72% of CEOs are concerned about the availability of key skills 75% call a skilled, educated, and adaptable workforce a priority
5 THE NEED FOR A NIMBLE WORKFORCE While college skills are critical, degrees alone aren t the only need. So-called middle skills computer technology, medical coding, high-skill manufacturing, and other fields that often require non-degree training 5 are notoriously difficult to fill and constantly evolving. Keeping up is essential; but in the hot talent market, replacing a lost employee is often neither practical nor cost effective. 66% of employers are increasing new hire salaries 7 Employees cost roughly 1.5 times their salary to replace 6 76% of employers are offering signing bonuses an all-time high 7
6 RECRUITING AND RETAINING WITH EDUCATION Recruitment specifically of employees with the right skills and who are the right fit is a challenge in itself. The average time it takes to fill a position rose to nearly two months in ; and more than a third of companies with extended vacancies (12+ weeks) reported diminished revenue 9. Faced with a dwindling supply of job-ready talent on the external market, employers are looking at other ways to keep workforce skills on pace with technology and competitive threads. One approach is appealing to employees hunger for education. Offering employees a development journey has the distinct advantages of both appealing to new hires (and potentially reducing the amount of time a valuable position remains vacant), and grooming existing, highly engaged employees to fill new and expanded roles. Job candidates today are looking for a career path, not just a paycheck. Employees who receive access to education become more committed to their employer. 60% 79% 81% would pick a job with strong development potential over one with regular pay raises 10 of employees call tuition assistance an important or very important factor in joining their company 11 say tuition assistance makes them more likely to stay with their organization 11
7 THE ADVANTAGES TO EMPLOYEE ENGAGEMENT Highly satisfied, engaged employees are known to substantially drive up revenue 2. Yet engagement in many organizations is sagging, with Gallup reporting that 70% of employees in 2016 were not engaged. But highly engaged employees at desirable organizations identified development opportunities as a reason they considered their employer a Dream Company, indicating that career development and engagement go hand in hand. 86% 83% 71% important to job satisfaction 11 effective at work 11 average levels of employee engagement 13 of employees call tuition assistance say it makes them more more likely to experience above
8 A BOOST FOR THE BOTTOM LINE Strategic employee education programs are already helping organizations score on multiple fronts in better hires, and improved recruitment, retention and the ability to nimbly adjust to changing organizational needs. The most successful programs also help organizations avoid lingering vacancies that result in lost revenue, and: Offer a broad range of learning vehicles, including degrees, non-degrees and internal initiatives, to help meet specific goals Promote career development programs and employee success stories in recruitment Incorporate academic and career coaching that helps employees select education that meets their interests and satisfies business needs Link employee development investments to workforce planning efforts Enable managers to hire for culture and train for skill As the market tightens, recruitment alone (which is costly to an organization) will not be enough to keep up with talent needs. Skill gaps are a reality but organizations that develop and engage employees with education strategies will be able to count on a sustainable resource to avoid them.
9 Contact us to learn more Follow ENDNOTES 1 Georgetown University Center on Education and the Workforce, Recovery: Job Growth and Education Requirements through 2020, June Labor Force Statistics for the Current Population Survey, Bureau of Labor Statistics, January Employment status of the civilian population 25 years and over by educational attainment, Bureau of Labor Statistics, December 2, PWC, Redefining Business Success in a Changing World; CEO Survey, January Thomas A. Kochan, David Finegold, Paul Osterman; Who Can Fix the Middle-Skills Gap? Harvard Business Review, December Tara Seigel Bernard, Why Companies Have Started to Coach New Parents, New York Times, July 22, Bonus Programs and Practices, World at Work, July HR and Recruiting Statistics for 2016, Glassdoor, Matt Ferguson, There s Skill Involved in Solving the Skill Gap, Workforce, March 20, Millennials Desperate for Financial Stability, in Search of Employer Support to Get There, EdAssist, Lasting Impact of Employer-Sponsored Tuition Assistance, Bright Horizons, Susan Sorenson, How Employee Engagement Drives Growth, Gallup, June 20, Decoding Corporate Culture, Aptitude Research Partners, Bright Horizons Family Solutions LLC. All Rights Reserved
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