Preparing for the Shrinking Talent Pool
As our population ages fueling the need for more and better qualified talent, the availability of the US ‘Human Capital Supply Chain’ continues to shrink. This demographic pressure will force companies to intensify their efforts to increase productivity, attract the best talent available and increase training efforts to continue to meet their expansion plans. As well-detailed in the book ‘TopGrading’ by Bradford Smart, PhD. The ability to achieve aggressive growth plans lies with the quality of the talent within organizations. ‘A’ players deliver significantly more revenue and profits than ‘B’ players.
The cost to an organization for a bad hire is estimated to be 30% of that person’s annual compensation, according to the US Department of Labor1. But consider what’s attributed to the cost of a bad hire…the length of their employment, the level of responsibility (i.e. Outside Sales vs. VP Sales) and training (e.g. training programs/software, time taken away from other employees, etc).
Finding talent will always be a trend. Modern Distribution Management, published this past January of what’s believed to be 2020s key theme: talent. Succession planning, educating the youth and training future managers remain important to prepare for the future and replace the retiring population.
The following chart shows the percent of population by age group between 2008, 2013 and 2018; summarizing the age group of workers that are most likely to move into key management positions will become significantly smaller as a percentage of the of the overall population.
Percent of Population by Age in 2008, 2013 and 2018
Kaiser Family Foundation