Unemployment is down to almost four percent nationally, lower in the Midwest. And there are no signs that it's going to reverse itself.
The pool of future employees has dwindled to a precious few. The Wall Street Journal reports that the country's labor force is growing at less than one percent annually. Only a decade or so down the road, it will stop growing. Let's face it-America is aging. Our supply of young people is dwindling while the bulging set of baby boomers gets older.
What does all this mean?
The answer is a combination of good news-bad news-maybe more good news.
First, the good news. College graduates in the next few years can almost write their own ticket to success-especially if they've elected to enter a profession like engineering, computer science and accounting. That's great for college graduates of the future.
The bad news-employers are finding it much more difficult to locate good, qualified job candidates. The combination of a dwindling labor supply and the increasingly sophisticated needs of companies is not good, and can be potentially harmful to those companies.w
But there's more good news around the corner. The face of the nation's employment picture is changing-it has to change. Employers are being forced to find new, less traditional approaches to getting their work done well. And many of them work.
For example, many companies are hiring temporary employees-often through an agency-to get their work done. That accomplishes several things: it allows the company to have access to qualified workers when they need them. It doesn't have to unnecessarily inflate its payroll to accommodate high demand, only to have to deal with sagging profits and morale when times are tougher. The company just contracts with an agency-the agency provides the workers for as long as they're need-then redirects them to another company when they're through.
The concept has been around for years-but mostly for manufacturing and non-skilled positions. Last year, about 385,000 manufacturing jobs disappeared in the U.S., but well over three million new jobs were created. The biggest growth areas were software programmers, management consultants, amusement-park workers, mortgage lenders, and temporary employees across many fields.
Technology temps are actually rewarded for moving frequently between jobs because they master new skills with each move. A tech skill in high demand today may be obsolete in less than a year. By changing jobs, tech specialists can build networks of contacts that often help them land more lucrative postings. Often the temporary agency will provide many of the same benefits that employers customarily offer full-time employees, after they have worked a required number of hours for that agency. The employees, too, often have greater flexibility with time off.
My recent college graduate son explained to me the advantages for him to be employed through a temporary agency right now. He's working for Merrill Lynch in Denver where the temp agency actually has a satellite office within the Merrill Lynch building. He's allowed to work as a "temp" or can sign on as a "temp to hire". He can rotate through various departments while trying to find out if the position and company are a "good fit" for him. As long as Merrill Lynch likes him and he likes Merrill Lynch, the relationship will continue. If he finds some part of the arrangement disagreeable, or vice versa, either one can request reassignment.
Peoria area employers are finding this set-up beneficial as well. Employers ranging in size from Caterpillar all the way down to a 3-employee company have discovered the benefits of temporary employment.
Still other smaller companies (usually under 500 employees) are outsourcing their human resources functions to professional management firms, such as Staff Management. These firms, known as professional employer organizations, are saving clients significant time and money and increasing employee morale while at the same time reducing a company's liabilities as an employer
Not everyone is in favor of "temps" and "outsourcing." Both have been dirty words to unions, for example, who see them as a threat to their existence. But they're nasty concepts to unions only in their old form. In their new form, many employees affected wouldn't have been union members anyway. And where larger companies are using them to hedge against economic cycles, they allow a flexibility that's become very necessary in these days of global competition. In the end, these new employment practices will help companies thrive-even survive-in the 21st Century. And that, of course, should be beneficial to union membership.
"The times, they are a'changin'" And we, think, for the better. A shortage of good, qualified workers need not be an insurmountable obstacle for growing businesses. Making the transition to a new way of doing business is going to be difficult-big changes always are. But we think, on balance, these new directions will benefit us all. IBI