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Plenty of People or Plentiful Talent?

Excerpted from a whitepaper titled “A Holistic View of Talent” by John Healy, Vice President & Talent Supply Chain Strategist for Kelly Services, Inc.
 
Having access to plenty of people is not the same as having access to plentiful talent. The availability of the right skill sets—the kind that drives innovation, efficiency and competitive advantage—is elusive. Companies globally are already reporting greater difficulty in filling key roles, and even when they find and hire the right talent, it’s less likely to stay put.
 
One study shows that 75 percent of companies are experiencing a deficiency in the qualifications of job candidates. Yet another study indicates that two-thirds of CEOs (66 percent) believe there is a limited supply of candidates with the right skills.
 
In addition to these specific skills shortages, talent generally have stopped managing their careers inside one company or even one industry, and instead look at their careers as a collection of assignments or contracts. For this reason, counting on internal talent to fill key roles over the medium to long term is no longer a reliable workforce strategy.
 
Instead, companies must look at the talent pipeline more holistically—internally and externally to access the skills they need.
 
Already, around one-third of the talent that companies rely upon is outside their walls and doesn’t appear on workforce plans (even if they’re being done). We also know that this outside talent comprises a growing proportion of free agents: people seeking work on their own terms and pursuing non-traditional work styles, such as contractors, retirees, micropreneurs and the self-employed.
 
The free agent population is also one of the most valuable pools of available talent. This is because:
 

  • 77 percent of free agents have a professional/technical skill-set and are well educated.
  • Free agents as a whole are highly experienced—as workers become more seasoned in their career, the propensity to become a free agent increases.
  • Free agents are measured by the outcomes they deliver, thus are often engaged to execute highly prioritized projects and then move on to the next engagement often at a higher “hourly” rate, but a lower total cost.

 
Free agents may already form a high proportion of company workforces, yet we’re likely to see this figure spike thanks to three key issues:
 

  • Businesses are now seeking higher and more specific skills and knowledge to help them respond to faster and more dramatic changes in their chosen market.
  • Long-term falls in fertility rates across those markets where highly skilled and educated talent has historically been in greatest supply are seeing the global working population age and decline.
  • Free agency is what many workers seek, and in those areas where skill sets are in highest demand, flexible work styles are already more prevalent.

 
Today, free agents across all industries make up 44 percent of the active workforce in the United States. And, a report from the Economists Intelligence Unit, Global firms in 2020, confirms this trend is likely to continue. When executives were asked how the employee experience would change at their organization over the next decade, six in 10 (62%) said that they would expect to see a growing proportion of contract-based workers, or free agents. This is five times the number who expect to see a growing proportion of internal staff at their organization.
 
From here on in, what will distinguish the best performing companies is how quickly they adapt to wide variations in the supply and demand of the right skill sets, and their ability to engage these non-traditional workforces to fill gaps.
 
About John Healy
John Healy, vice president and talent supply chain strategist for Kelly Services, Inc., is responsible for integrating data analytics with supply chain principles to drive proactive management of talent acquisition strategies across directly hired and outsourced labor categories. He is a member of The Gartner Research Sourcing & Vendor Management Council and the Duke University Center for International Business Education and Research (CIBER). He has been a featured speaker on related topics for Staffing Industry Analysts, Human Capital Institute, and the Institute for Supply Management.