A Real Sea Change of Talent Management is Happening. Don’t Miss the Boat.
Contributed by Pamela Wasley, CEO.
In this, my annual message to fellow CEOs, I want to shed more light on the huge cultural and economic shift that is revolutionizing the definition of a “worker” today. I’m also sharing a Podcast, The Independent Contractor Boom, recorded at an event in Virginia we co-sponsored featuring three nationally recognized experts in staffing strategies.
This year my words are written for an additional audience – the legions of independent executives out there who work on a part-time contract basis rather than as full-time employees. This message is addressed to The CEO and to the Hired Gun because you’re going to be seeing a lot more of each other. And that’s a good thing for both of you. Let’s look at the facts.
The Economic Outlook
The US is on track to end 2014 with a GDP growth rate between 2.2% – 2.5%. As for 2015 all the forward-looking reports I see expect 2015 to be a lot like 2014. The CEOs I speak with on a daily basis concur, but with caution.
The official unemployment rate dropped from 6.6% to 5.8% as of November 1, 2014. However, anyone who studies the unemployment figures knows that these low figures don’t accurately represent the high number of unemployed or under-employed in the country. It’s safe to say there are many millions of capable Americans that don’t have full-time jobs. On the other hand, as studies have revealed, there are millions of independent workers who are very satisfied not being tied to one employer.
The Real Problem Holding Back Growth: Lack of Skilled Talent
While millions are available to work there is a mis-match in the skills they possess and the skills that are in demand by industry. As I’ve reported before, the problem CEOs are facing is finding and retaining skilled talent – technical positions and management positions alike. The scarcity of talent having the right skills is imposing limits on the growth potential of many companies with which I’m familiar. Odds are good that you’re in that boat, too. Here’s some data to re-enforce the point.
- Nearly one out of every three (31.1%) HR professionals in the Manufacturing and Services sectors are experiencing greater recruiting difficulty compared to 2013.
- In a recent study by Elance-oDesk and Millennial Branding, 55% of the hiring managers said they were hiring for hard skills, not soft skills like personality or attitude. This is a significant shift from 2013 when survey respondents said that companies were looking more for soft skills than hard skills.
The Solution is All Around Us
As the focus on hard skills increases, companies are looking at bringing on more contingent workers to fulfill these skills. Thus 41% of the companies surveyed plan to hire more contingent workers in the next five years. The top reasons stated were access to specific skills, scaling as needs changed and ability to start work immediately with little or no training. To be honest with you, I think the percentage is going to be higher, especially in the SMB sector. Experts are already forecasting that 50% of the US workforce will be contingent workers by 2020.
In a recent study by ZenPayroll, small to mid-sized businesses are using more independent workers and fewer traditional employees than in the past. They like having a remote or distributed workforce as opposed to having a large number of employees. This is mostly due to the specialized expertise needed to be competitive in today’s marketplace. They like being able to buy project-based talent rather than hire a full time permanent position. The truth is, companies have become less willing to devote capital to long-term hiring commitments.
The switch from job description-based hiring to statement-of-work hiring is discussed by our expert panel in this podcast, The Independent Contractor Boom, Part 3.
The good news for CEOs is there is a huge (and growing) pool of skilled talent in the contingent workforce.
The good news for contingent workers, including independent contract executives, is there is a huge pool of companies desperate to have the right talent at the right time to solve a specific set of problems.
The trick is in efficiently connecting the two and facilitating a working relationship. More about this later.
According to a recent study conducted by the independent research firm Edelman Berland, 34% of the entire American workforce is now made up of contingent workers (independent consultants, freelancers, part time workers, etc.). That equates to 53 million workers. So do you still doubt that by the year 2020, 50% of the workforce will be contingent? Think about that for minute. Imagine driving down the street in an average neighborhood knowing that in every second house and apartment lived a contingent worker. That’s the Sea Change we’re experiencing.
Want a deeper dive into this trend? You can hear more amazing statistics about the contingent workforce in The Independent Contractor Boom, Part 1.
This Sea Change Requires a Better Boat. Re-inventing the Executive Staffing Business
At my company, Cerius Executives, we’re very, very good at bringing companies together with the right contract executive talent for part-time, temporary, interim and consulting assignments. We’ve built our national reputation on relationships, process and trust.
And I’m pleased to announce that very soon our Cerius Online executive network will be in Beta. Cerius is re-inventing the executive staffing business. We’re blending our CeriusMatch™ process, human touch, and technology into what promises to be the most effective and efficient tool to find top level, pre-vetted executive talent. Companies will be able to use our guided search facility to peruse a short list of profiles from qualified, pre-vetted executives. Then, our CeriusMatch™ specialists work with you to refine your requirements, define the project and recommend the independent contract executive that’s the best fit for the project and your culture.
If you’re an independent executive and want your profile included, please email Matt Sauer, our Chief People Officer. If you are a company manager and want to participate in the beta program, please send an email to Kristen McAlister, President.
Thank you all for the support and business you gave us in 2014. I wish all of you a very safe and wonderful holiday season.