Global Talent Market Quarterly THIRD QUARTER l 2012
Global Talent Market QuarterlyCONTENTS 3 Global Economic Situation • Briefing • Outlook 6 Global Labor Market Update • Americas • EMEA • APAC • Global Labor Market Spotlight • Legislative Update 12 U.S. Labor Market Overview • Current Employment Conditions • Supply and Demand • Labor Market Spotlight 16 Workforce Solutions Industry Insight • Global Labor Supply and Demad Forecasts • Talent Challenges in Rapid Growth Markets • Social Media: Business or Pleasure? • Kelly Knowledge
Global Talent Market Quarterly BACK TO TABLE OF CONTENTS GLOBAL ECONOMIC BRIEFING The global economy has hit a soS patch in 2012, as contrac?on in several European markets and slowing in India and China is leading to muted economic ac?vity worldwide. Emerging markets and the APAC region con?nue to lead the growth trend, despite some weakness. AMERICAS EMEA APAC The global economic slowdown is expected to The Eurozone crisis con?nues to drag down Low export demand and cooling growth in cause sluggish growth across the Americas economic growth across most of the region. China and India have soSened the APAC region through 2013. Stronger economic Gradual recovery is expected to begin in 2013. outlook for 2012-‐2013, but healthy domes?c ac?vity is forecast to resume in 2014. demand is helping to prop up many markets. Eurozone Canada Economic growth in many Eurozone countries is Japan Modest growth of around 2% is predicted to barely posi:ve, while markets including Italy, Economic growth was surprisingly strong in the con:nue through 2013. Strength in the natural the Netherlands and Spain are sinking into ﬁrst part of 2012, thanks to healthy household resources sectors is being tempered by recession. Improvements are expected in 2013, spending and con:nued recovery eﬀorts. government austerity measures and consumer but signiﬁcant growth will hold oﬀ un:l 2014. Growth is expected to remain moderate and business cau:on in the face of uncertain throughout the rest of the year and in 2013. global economic condi:ons. U.K. GDP growth is expected to resume in the U.K. in China U.S. the second half of 2012 aZer three quarters of Second quarter growth decelerated to 7.6%, The U.S. economy con:nues to expand at a contrac:on. The economy is expected to the lowest rate in nearly three years. S:mulus modest pace, with 2% growth projected con:nue to recover gradually in 2013 and eﬀorts are expected to revive the economy in through 2013. Future gains depend on both 2014, in step with the rest of Western Europe. the second half, but a return to sustained long-‐ term growth will require structural reforms. the health of the global economy and policy Central and Eastern Europe measures following the 2012 elec:on. India Reduced demand from Western Europe will La?n America con:nue to dampen economic performance The economy has lost some momentum due to Economic ac:vity in the region con:nues to through 2013, but growth in many of the weak global demand and domes:c policy cool in 2012, with the slowdown felt most region’s larger markets including Russia, Turkey issues, but growth is projected to accelerate in heavily among export-‐dependent countries. and Poland is expected to remain healthy. 2013 and strengthen further in 2014. Although growth is expected to accelerate Australia Middle East and North Africa again in 2013 and beyond, policy adjustments Australia’s economy remains strong in the face Despite ongoing poli:cal tensions, economic will also be necessary to create and sustain of the cooler global climate, with a sound momentum should accelerate in the region in more robust growth levels. outlook supported by con:nued growth in the 2012-‐13 as many countries con:nue to develop and implement policies that foster growth. mining and natural resources sectors. 4 Sources: IHS Global Insight reports (July 2012); Wall Street Journal, 07.13.12 and 07.18.12; Reuters, 05.22.12 and 07.18.12
Global Labor Market Update THIRD QUARTER l 2012
Global Talent Market Quarterly BACK TO TABLE OF CONTENTS GLOBAL LABOR MARKET UPDATE: AMERICAS Posi?ve employment trends con?nue across the Americas region, although the U.S. and Canada have seen some cooling in 2012 as a result of the global economic slowdown. Cau?ous hiring is expected to con?nue across most of the region, leading to lower unemployment levels in the coming years. UNITED STATES BRAZIL CANADA MEXICO Robust job crea:on in the ﬁrst Despite more moderate recent Canada’s labor market outlook is The oﬃcial unemployment rate quarter of 2012 was replaced by economic growth, employment broadly posi:ve, as vacancy and in Mexico remains in the more subdued hiring in the con:nues to trend upwards and wage data suggest that demand 4.5%-‐5% range—low by regional second as the labor market unemployment rates con:nue to for labor is healthy. Fihul hiring standards but s:ll higher than its began to react to the cooler fall in Brazil in 2012, a sign that trends in the ﬁrst part of 2012 pre-‐recession level of 3.5%-‐4%. global economy. Stronger ac:vity employers remain conﬁdent and indicate that employers remain Gradual improvement is is expected in 2013 and 2014 as are preparing for the eventual somewhat cau:ous in light of the expected as the economy uncertain:es subside. economic upturn. global economic situa:on. con:nues to add formal jobs. Average Annual Unemployment Rate 10% 8% 8.1% 7.8% 7.2% 7.3% 2012 (p) 6% 6.8% 6.5% 5.7% 5.6% 2013 (p) 5.3% 4% 4.8% 4.6% 4.3% 2014 (p) 2% 0% U.S. Brazil Canada Mexico Sources: IHS Global Insight reports (July 2012); Reuters, 05.21.12, 06.20.12 and 07.06.12 7
Global Talent Market Quarterly BACK TO TABLE OF CONTENTS GLOBAL LABOR MARKET UPDATE: EMEA Weakness stemming from the European ﬁscal crisis is keeping worker demand low and unemployment high across much of the region, with signiﬁcant improvements not expected un?l 2014. Despite the uncertain economic situa?on, labor markets con?nue to perform well in some countries, including Germany, Russia, and the U.K. GERMANY FRANCE UNITED KINGDOM RUSSIA Job growth in Germany remains The labor market con:nues to Despite the economic climate, Unemployment in Russia rela:vely healthy in the face of deteriorate, with unemployment unemployment has remained in con:nues to steadily decline as soZer economic condi:ons. The in mid-‐2012 at its highest level in check in 2012 due to increases in the economy remains resilient. country’s steady decline in more than a decade. The new self-‐employment and part-‐:me The lowest unemployment rates unemployment has lost some government is considering work, and job crea:on driven by are seen in the regions around momentum in 2012, but is stricter legisla:on surrounding the Olympics. Real improvements Moscow and St. Petersburg. expected to resume its layoﬀs to help curb the rising in the labor market are not downward trend in 2013. joblessness. expected un:l 2014. ITALY Demand for workers is expected to remain weak throughout 2012 Average Annual Unemployment Rate and 2013. Austerity plans have cut employment in the public sector, and private employers 10% are hesitant to add jobs in the 9.8% 9.8% 10.0% 9.7% 9.9% 9.3% midst of a declining economy. 8% 8.5% 8.7% 8.4% 2012 (p) 6% 6.8% 6.6% 6.2% 5.7% 5.4% 2013 (p) 5.2% 4% 2014 (p) 2% 0% Germany France U.K. Russia Italy Sources: IHS Global Insight reports (July 2012); Reuters, 06.28.12; Reuters, 06.07.12; BusinessWeek, 07.18.12; Moscow Times, 07.23.12; Agence France Presse, 07.02.12 8
Global Talent Market Quarterly BACK TO TABLE OF CONTENTS GLOBAL LABOR MARKET UPDATE: APAC Many APAC labor markets are showing some signs of soSness in 2012, par?cularly in manufacturing sectors as the region grapples with slowing export demand. However, healthy domes?c demand and ongoing recovery eﬀorts are helping to boost employment levels across the region, and the labor market outlook for 2013 and 2014 is posi?ve. JAPAN CHINA INDIA AUSTRALIA Employment growth and job The labor market in China is Employment growth in India has Labor market performance is crea:on trends are posi:ve, as the showing some signs of weakness. moderated somewhat due to healthy but uneven as global economy con:nues to recover Indicators suggest that hiring is soZer economic condi:ons both uncertainty and the strong following the 2011 natural slowing, and job cuts may be at home and globally. Hiring currency constrain employers’ disasters and ongoing rebuilding spreading in manufacturing and inten:ons are strongest in the hiring sen:ments. The market is eﬀorts encourage employers to heavy industry, amid more construc:on industry and the expected to con:nue along an take on more workers. modest demand trends and a service sector, par:cularly retail, unsteady path, with modest cooling economic climate. sales and healthcare. employment gains oﬀset by higher labor force par:cipa:on. Average Annual Unemployment Rate 10% 9.3% 9.1% 8% 9.0% 2012 (p) 6% 2013 (p) 5.2% 5.1% 4% 4.8% 4.7% 4.6% 4.7% 2014 (p) 4.2% 4.1% 4.0% 2% 0% Japan China India Australia Sources: IHS Global Insight reports (July 2012); HSBC 06.07.12 and 07.12.12; India Times, 07.23.12; Indian Express, 07.23.12; Financial Times, 07.11.12; Reuters, 05.28.12 and 06.28.12 9 9
Global Talent Market Quarterly BACK TO TABLE OF CONTENTS GLOBAL LABOR MARKET SPOTLIGHT: AGING WORKFORCE organiza?ons try to envision and plan for the labor market of the future, aging workforces are a key considera?on in many countries. An As increasingly older labor force will bring unique challenges, including ﬁlling skills gaps and addressing re?rement issues. NEARLY A QUARTER OF GLOBAL WORKERS WILL BE AGE 55+ BY 2030 The aging trend will be most acutely felt in the advanced economies and China. In the Net New Re?rees per New Worker, 2010-‐2030E* advanced economies, the share of older workers in the labor force will grow from 18% in 2010 to 27% in 2030. In the most rapidly aging advanced economies such as Japan and 2 Germany, more than 30% of the labor force will be 55+ in 2030. In China, the propor:on of older workers is expected to more than double in the next two decades. Even in La:n 1.5 America, which has a rela:vely young popula:on, aging will slow labor force growth. AGING TREND WILL CAUSE FUTURE LABOR FORCE CHALLENGES 1 The number of re:rees in the world is expected to grow by 2.3% per year over the next two 0.5 decades, more than twice the annual labor force growth rate, leading to a number of issues. Skills shortages are expected to intensify as educated workers re:re. The growing number of 0 re:rees will lead to greater demand for social and healthcare services. And economies will Advanced China Other India need to boost produc:vity in order to sustain growth rates with smaller labor forces. Boos:ng Economies Emerging labor force par:cipa:on rates of older workers is one way to help solve these challenges. Markets Labor Force % GLOBAL ADVANCED ECONOMIES CHINA by Age 10% 14% 8% 22% 13% 18% 15% 27% Older (55+) 31% Prime (25-‐54) Young (15-‐24) 60% 62% 65% 69% 70% 64% 72% 68% 62% 28% 22% 32% 16% 12% 10% 13% 11% 6% 1980 2010 2030E 1980 2010 2030E 1980 2010 2030E Source: : The World at Work: Jobs, Pay, and Skills for 3.5 Billion People, McKinsey Global Ins:tute, 2012 *Re:rees are deﬁned as workers between 55-‐70 years old who are not likely to be in the labor force in 2030. Advanced Economies are those with 10 GDP Per Capita above $20,000 (USD at 2005 PPP). Other Emerging Markets are those with GDP Per Capita between $3,000 and $20,000 including na:ons in Asia (Philippines, Indonesia, Thailand, Malaysia, etc.), La:n America (Brazil, Mexico, Argen:na, Peru, etc.), the Middle East and Africa.
Global Talent Market Quarterly BACK TO TABLE OF CONTENTS GLOBAL LEGISLATIVE UPDATE Several countries have implemented or are considering changes to their regula?ons on temporary and contract workers, including Norway, which will bring its prac?ces in line with the EU’s Agency Worker Direc?ve. New and pending labor legisla?on in Venezuela, Saudi Arabia, and Canada aims to increase labor force par?cipa?on, while the new lower re?rement age in France deﬁes that trend. NORWAY CANADA Although not a member of the New regula:ons expected to take eﬀect AUSTRIA, BELGIUM European Union, Norway will in early 2013 will require workers New legisla:on requires employers to ensure implement the EU’s Agency Worker equal treatment of temporary workers. In receiving unemployment beneﬁts to be Direc:ve in 2013, ensuring the willing to accept available jobs that are Belgium, liZing restric:ons on the use of equal protec:on and treatment of lower paying, outside their ﬁeld, or are temporary workers, par:cularly in the public temporary workers. located farther away. sector, is being reviewed. FRANCE SINGAPORE The new French government lowered the The Employment Act will be U.S. re:rement age from 62 to 60 for workers with more reviewed in the second half of The Supreme Court upheld the health than 40 years of social security contribu:ons. The 2012, with expected revisions to care reform act, paving the way for the move is contrary to many other developed countries address working condi:ons and implementa:on of both the individual that are increasing re:rement ages in the face of pay for low wage employees and and employer mandates for health care demographic and ﬁscal challenges. contract workers. insurance provision in 2014. SAUDI ARABIA MALAYSIA VENEZUELA Pending legisla:on would A minimum wage law will take The country’s new labor law includes shorten the workweek in eﬀect in Malaysia for the ﬁrst provisions to eliminate the prac:ce of the private sector in order :me as of January 2013, and will outsourcing, reduce working hours from 44 to force companies to likely be phased in over the next to 40 hours a week, lengthen maternity expand their workforces. two years. The minimum wage leaves, and make layoﬀs more diﬃcult. level is expected to be modest and vary across the country. Sources: Global Insight 06.14.12, 06.07.12; Reuters, 05.24.12; SIA Daily News, 05.30.12, 06.28.12, 07.17.12; HRM Asia 05.28.12; VenezuelaAnalysis, 05.01.12; Global Market Brief & Labor Risk Index Q3 2012, KellyOCG/Eurasia; SIA Legs and Regs Advisor, April 2012 11
U.S. Labor Market Overview THIRD QUARTER l 2012
Global Talent Market Quarterly BACK TO TABLE OF CONTENTS U.S. EMPLOYMENT CONDITIONS SECOND QUARTER HIRING DECELERATES U.S. MONTHLY EMPLOYMENT CHANGE AND UNEMPLOYMENT RATE The U.S. job market hit a soZ patch in the Unemployment Rate (%) second quarter of 2012, adding to concerns that Employment (000’s) 600 11 the broader economic slowdown has now 300 10 started to aﬀect U.S. hiring. Employment gains 9 averaged only 75,000 a month in the second 0 8 quarter, three :mes slower than the rate of job -‐300 7 crea:on in the ﬁrst three months of the year. -‐600 6 UNEMPLOYMENT RATE STAGNANT -‐900 5 Jun-‐09 Mar-‐10 Jun-‐10 Mar-‐11 Jun-‐11 Mar-‐12 Jun-‐12 Dec-‐09 Dec-‐10 Dec-‐11 Sep-‐09 Sep-‐10 Sep-‐11 The unemployment rate remained at 8.2% in June 2012. Although lower than the above-‐9% rates seen in much of 2011, unemployment has shown litle improvement since the ﬁrst of the Non-‐Farm Employment Private-‐Sector Employment Unemployment Rate year and remains signiﬁcantly above pre-‐ recession levels. EMPLOYMENT OVERVIEW DEMAND GROWS AND LAYOFFS SLOW The number of job openings has been JUN MAY APR MAR FEB increasing steadily since the recession ended, signaling a renewed demand trend. The pace of Total non-‐farm employment growth 80K 77K 68K 143K 259K layoﬀs has also slowed and is now back to its long-‐term average level. But these encouraging Private employment growth 84K 105K 85K 147K 254K trends have not yet translated into signiﬁcant and sustained job crea:on. Unemployment rate 8.2% 8.2% 8.1% 8.2% 8.3% EMPLOYERS REMAIN CAUTIOUS Some employers indicate that the lack of hiring stems from the inability to ﬁnd skilled workers, but many simply remain hesitant to ramp up their full-‐ :me workforces in the midst of uncertain economic and poli:cal condi:ons. The ongoing European crisis, slowdowns in emerging economies, and concern over U.S. policies con:nue to weigh heavily on employers’ minds and put a damper on hiring plans. Sources: Bureau of Labor Sta:s:cs 13
Global Talent Market Quarterly BACK TO TABLE OF CONTENTS U.S. LABOR MARKET -‐ SUPPLY AND DEMAND JOB DEMAND ON UPWARD BUT UNEVEN TREND U.S. MARKET -‐ MONTHLY LABOR DEMAND VS. LABOR SUPPLY Employers con:nue to look for more workers, as online adver:sed job vacancies increased at an average rate of over 100,000 per month in the ﬁrst 16,000 10,000 half of 2012. The demand momentum remains ﬁhul, however, as job ads were up sharply in June but 14,000 9,000 declined in May and July. 8,000 No. of Online Job Ads 12,000 No. of Unemployed DEMAND SURPASSING PRE-‐RECESSION LEVELS Job adver:sements con:nue to grow, with around 7,000 two-‐thirds of both U.S. states and metropolitan (in 000s) (in 000s) 10,000 areas now at or above their pre-‐recession levels in labor demand. Despite the posi:ve trend, some 6,000 metro areas s:ll have unfavorable supply/demand 8,000 ra:os, including Riverside, Los Angeles, and 5,000 Sacramento, CA; Las Vegas; and Miami. 6,000 4,000 JOB MARKET TIGHTEST FOR STEM OCCUPATIONS STEM (science, technology, math and engineering) 4,000 3,000 workers con:nue to be in hot demand. Computer and mathema:cal science, healthcare prac::oners, and architecture/ engineering are the only large 2,000 2,000 Mar 09 Mar 10 Mar 11 Mar 12 Jun 08 Sep 08 Jun 09 Sep 09 Jun 10 Sep 10 Jun 11 Jun 12 Sept 11 Dec 08 Dec 09 Dec 10 Dec 11 occupa:onal categories in which adver:sed job vacancies outnumber job seekers. # of unemployed workers # of online ads “As of June, almost half of the occupa:onal groups have Supply/Demand rates at or below 2.0. Most of these are in professional categories, such as business and ﬁnance, healthcare professionals, and management.” — June Shelp, Vice President, The Conference Board, July 2, 2012 Sources: Conference Board Help Wanted OnLine, Bureau of Labor Sta:s:cs 14
Global Talent Market Quarterly BACK TO TABLE OF CONTENTS U.S. LABOR MARKET SPOTLIGHT: BRIDGING THE TALENT GAP HELP WANTED SIGNS ARE STILL UP Plenty of U.S. companies are looking for workers. 60% Eﬀects of Job Vacancies on Current Workers According to a recent CareerBuilder survey, more than 50% one-‐third of employers say they currently have open 51% 40% posi:ons for which they cannot ﬁnd qualiﬁed candidates. 30% 36% 34% 33% OPEN POSITIONS TAKING TOLL ON WORKERS, FIRMS 20% Ongoing job vacancies are aﬀec:ng current workers’ 23% 10% axtudes and performances—and companies’ botom 0% lines. Over half of employers say that current employees Longer hours Overworked/ no Lower quality of Lower morale Loss in revenue are working longer hours. More than one-‐third of work-‐life balance work employers reported that job vacancies have led to overworked employees, a reduced quality of work and lower morale. Nearly one-‐fourth cited a loss in revenue 80% Most Diﬃcult Posi?ons to Fill due to the inability to ﬁll open posi:ons. 60% EMPLOYERS NOT ADDRESSING SKILLS GAPS 61% 58% 57% Employers report that the most diﬃcult posi:ons to ﬁll 40% 54% are those in cri:cal areas such as C-‐level management, 48% 47% business development, engineering, and IT. But despite 20% the shorhalls in such high-‐proﬁle areas, less than half (41%) of employers surveyed say they are engaging 0% workers in training or other programs to help alleviate the Engineering C-‐Level Business Crea:ve/ Management IT talent crunch. Development Design CANDIDATES ARE READY TO LEARN, CHANGE Job seekers, however, say that they are more than willing to gain the addi:onal skills that employers are looking for. Few Employers Have But Many Candidates are Willing to Learn New Nearly two-‐thirds of candidates (65%) say that they are Programs that Fill Skills Gaps Skills and/or Train for a Job in a Diﬀerent Field extremely or very willing to learn new skills, and more than three-‐fourths (77%) say they would be willing to train for a 41% 65% 77% job in a diﬀerent ﬁeld. Source: The Talent Crunch, CareerBuilder, June 2012 15
Workforce Solutions Industry Insight THIRD QUARTER l 2012
Global Talent Market Quarterly BACK TO TABLE OF CONTENTS THE WORLD AT WORK: GLOBAL LABOR SUPPLY AND DEMAND FORECASTS Labor forces around the globe are being shaped by various economic, demographic, and cultural changes that are leading to mismatches in the supply and demand for workers. A new report by the McKinsey Global Ins?tute predicts that these skills imbalances will grow stronger in the decades to come, unless decisive ac?on is taken by key stakeholders, including policymakers and businesses. 23% SKILLS IMBALANCES WILL INTENSIFY As the world economy shiZs towards knowledge-‐ and service-‐ 21% based employment, demand for trained and skilled workers 21% con:nues to grow. Global labor markets will face the challenge of DEMAND/SUPPLY GAPS BY SKILL LEVEL, Low-‐Skill Workers having too few high-‐ and medium-‐skilled workers, and too many 2020(E) 16% Total Surplus low-‐skilled workers in the coming years. +89 to 94M 13% The shortage of high-‐skilled workers will be most severe in India advanced economies and in China. China, despite a drama:c rise Advanced -‐13M in educa:onal atainment, is expected to see a gap of 23 million Economies college-‐educated workers by 2020. -‐16 to -‐18M Young Developing Industrializa:on is expected to raise demand for medium-‐skilled China Economies workers in India and young developing economies, but a shortage -‐23M -‐31M of these workers will arise due to low rates of secondary educa:on enrollment and comple:on. India & Young Developing A poten:al surplus of around 90 million or more low-‐skilled Economies workers worldwide is projected by 2020. Advanced economies will +58M need to ﬁnd employment for more than 30 million low-‐skilled High-‐Skill Workers Medium-‐Skill Workers Total Shortage Total Shortage Advanced workers, but nearly two-‐thirds of the oversupply will be in India Economies and other young developing economies in Asia and Africa. -‐38 to -‐41M -‐45M +32 to +35M Source: The World at Work: Jobs, Pay, and Skills for 3.5Billion People, McKinsey Global Ins:tute, 2012 17 Young Developing Countries are in Asia (Bangladesh, Pakistan) and Africa (Nigeria, Kenya, etc.).
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