According to the Society for Human Resources Management (SHRM), hiring in the manufacturing sector is increasing. However, the services sector is decreasing even as the scarcity of skilled candidates in various industry sectors are driving wages higher. The upcoming holiday season retail hiring has already been kicked off by the supermarket chain Kroger, which plans to hire 20000 new grocery workers to meet existing need in its stores as well as near-term growth plans.
In the current economy, job gains and losses seem applicable to specific industries rather than the economy as a whole. But, by all accounts, the unemployment rate is coming down. The Bureau of Labor Statistics puts the unemployment rate at 6.1% in Aug 2014, changed by 0.1% from the previous month–inching that slight bit closer to the natural unemployment rate of 5.5%.
Source: Bureau of Labor Statistics
Of course, it is better not to get complacent because the very calculation of the unemployment rate has recently come under question. According to an academic study, the rate is calculated using 8 rotation groups as samples with a formula that suffers a “rotation group bias”. The resultant error could have been compounded over the years, making the calculation of the unemployment rate unreliable and open to question.
So, if the real unemployment rate stands at a much higher level than predicted, the mystery of the talent shortages deepens further! What is affecting the availability of skilled workers so strongly that one in five businesses claims to be affected by the lack of access to skilled candidates? Also, what can be done to bridge the gap? As recent research suggests, it not just America but most countries of the world that would be facing these shortages, so immigration might also stop being a viable option at some point.
Points to Ponder:
Governments will need to focus on the critical skills required to fuel the economy and take appropriate targeted measures to improve the availability of skilled workers through training and additional incentives. Immigration could also be an option, only if there is political will, which needs the modification of existing policies which may make it difficult for new talent to enter the country.
The truth is that today’s America is faced with serious manpower shortages in engineering, IT, healthcare, and other fields. Many industries, including utilities, power transmission, nuclear reactors, waste treatment systems and aerospace, to name a few, struggle to replace retiring employees.
There is no time like now to effectively employ training to meet business goals and outcomes.
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