American Airlines was forced to cancel close to a thousand flights in the last weeks of June 2021 due to lack of staff. The cancellations made headlines around the world. But this was no freak event. This, according to spokesperson for the airline who spoke to CNN, was the result of wider labor shortages.
Organizations everywhere should take note.
The current global labor shortage, one of the fastest-growing since records began, has many implications for businesses—and most of them are not good. For American Airlines, it has already meant cancelled flights and lost revenue. Others face similar impacts in the months and years to come.
Part of this means always looking into how work and employee expectations are changing for enterprise companies.
What can your organization do to optimize talent acquisition and continue recruiting and retaining the people you need in a world where candidates are scarce?
What’s happening to global talent supply?
According to figures recently published by KPMG and the Recruitment and Employment Confederation (REC), the number of workers available to Britain’s employers plunged in June 2021 at the fastest rate since 1997. While Brexit may be a contributory factor for the UK, it cannot explain the similar figures being repeated across the world. As of late April 2021, there were over 9 million open jobs in the U.S., a record high. Meanwhile, an EU report in December 2020 identified shortages in construction, engineering, software development and healthcare. What’s driving the shortage? Rapid economic expansion (according to the World Bank, the global economy is set to grow by its strongest postrecession pace in 80 years during 2021). The sudden release of pent-up demand for projects that were delayed due to Covid-19. Long-standing demand for talent in areas such as digital transformation, which the pandemic has only exacerbated. In short: a perfect storm.
About This Report
To compound the issue, talent acquisition itself has become a leading field for candidate scarcity, along with more familiar suspects such as IT, engineering, project management, customer service and skilled trades. For example, it is now just as hard to find a STEM recruiter in Silicon Valley as it is to find a Java developer. In Australia, technical recruiters are 10 times harder to find than data scientists. In the UK, it is up to 10 times harder to find IT recruiters than management information systems managers.
And it’s not just recruitment that is being affected. Retention is now a major problem as well. Why? Because an over-heating employment market means more opportunities, more tempting job offers, and more reason for good talent to look and go elsewhere—and even those who are not actively applying for new jobs are being bombarded with LinkedIn Inmails and more. This piles even greater pressure on talent acquisition teams. On top of finding new people for new roles, they must also find new people to replace all the ones that have left. What’s happening to global talent supply?
Korn Ferry is a global organizational consulting firm. We work with our clients to design optimal organization structures, roles, and responsibilities. We help them hire the right people and advise them on how to reward and motivate their workforce while developing professionals as they navigate and advance their careers. Our 7,000 experts in more than 50 countries deliver on five core areas: Organization Strategy, Assessment and Succession, Talent Acquisition, Leadership Development, and Total Rewards.