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The Ongoing Impact of the Recession—Recruiting and Skill Gaps

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Two-thirds (66%) of organizations that are currently hiring full-time staff indicated that they are having a difficult time recruiting for specific job openings, an increase from 52% reported in 2011. …

Two-thirds (66%) of organizations that are currently hiring full-time staff indicated that they are having a difficult time recruiting for specific job openings, an increase from 52% reported in 2011. HR professionals indicated that the top four applied skills gaps for job applicants are critical thinking/problem solving (53%), professionalism/work ethic (46%), written communications (41%) and leadership (38%).

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  • 1. SHRM Survey Findings: The Ongoing Impact of theRecession—Recruiting and Skill Gaps March 12, 2013
  • 2. Introduction• This is Part 2 of a series of SHRM survey results about the ongoing impact of the U.S. and global recession, which began in 2007. Overall results will be reported separately in three different topic areas:  Overall financial health and hiring.  Recruiting and skill gaps.  Global competition and hiring strategies.• Overall results for 2012 will also be reported separately for California.• Industry-specific results will be reported separately for each of the eight industries that were included in the sample:  Construction, oil, mining and gas.  Federal government.  Finance.  Health.  High-tech.  Manufacturing.  Professional services.  State and local government. The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 2
  • 3. Key Findings: Difficulties in Recruiting• Is recruiting for specific jobs difficult in the current labor market? Two-thirds (66%) of organizations that are currently hiring full-time staff indicated that they are having a difficult time recruiting for specific job openings, an increase from 52% reported in 2011.• What basic knowledge and applied skill gaps do job applicants typically have? For basic knowledge skills, writing in English (55%), mathematics (38%), reading comprehension (31%) and English language (spoken) (29%) are the most common skills gaps. The top four applied skills gaps are critical thinking/problem solving (53%), professionalism/work ethic (46%), written communications (41%) and leadership (38%).• What types of jobs are the most difficult to fill? Although difficulty in filling specific jobs varies by industry, the top five most difficult positions to fill overall are highly skilled positions: scientists (88%), engineers (86%), high-skilled technical (e.g., technicians and programmers) (85%), high-skilled medical (e.g., nurses, doctors, specialists) (83%), and managers and executives (77%). The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 3
  • 4. Key Findings: The Impact of Strategic Technological Changes• How many organizations are making major technology changes that affect the work of employees? Thirty percent of organizations indicated that in the last 12 months they had made major strategic changes involving the use of technology (e.g., robotics, computerized systems, software technologies) that affect the work of employees, and 10% plan to do so in the next 12 months.• Will these technological changes affect the number of full-time regular employees? For organizations that have made technological changes in the last 12 months or that plan to in the next 12 months, 71% indicated that the number of employees will stay the same. Sixteen percent reported an increase, and 13% a decrease, in the total number of employees.• Will these technological changes affect what employee skills are required for the organization? Although 72% of organizations indicated these technological changes would require new skills, they would not require new staff. Eighteen percent indicated employees would require the same skills, and 10% would need to hire new staff for the new skills that would be required. The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 4
  • 5. What do these findings mean for the HR profession?• HR professionals may need to convince hiring managers that staffing for some jobs will be more difficult than expected. This is particularly true of STEM (science, technology, engineering and math) jobs. In particular, the high-tech and manufacturing industries are experiencing difficulty recruiting for certain positions. HR professionals may need to work with their organizational leaders to come up with more effective compensation packages for hard-to-fill jobs.• Staffing for replacement needs of jobs exited by retiring Baby Boomers may create an even bigger staffing challenge in the years ahead. The U.S. Bureau of Labor Statistics’ (BLS) 2010-2020 Employment Project Report forecasts a decreasing overall labor force from 2010 to 2020. With the Baby Boomers leaving the workforce, replacement needs will exceed new job growth vacancies in four out of five occupations.• Technological changes may reduce the number of full-time regular employees for some organizations. HR professionals will need to take a lead role in driving increases in productivity while making sure employees are not at risk of burnout.• Skills shortages may put renewed emphasis on training. In the years ahead, HR professionals will need to work with their organizational leaders and relevant education and training bodies to invest in education and training as a way to meet skills shortfalls. The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 5
  • 6. Difficulties in Recruiting The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 6
  • 7. In general, in the current labor market, are you having a difficult time recruiting for certain types of full-time, regular positions that are open in your organization? 2011 2012 No, 34% No, 48% Yes, 52% Yes, 66% n = 1,568 n = 2,562Note: Respondents who answered “don’t know” were excluded from this analysis. Only respondents whose organizationswere currently hiring full-time staff were asked this question. The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 7
  • 8. In general, in the current labor market, are you having a difficult time recruiting for certain types of full-time, regular positions that are open in your organization?Comparisons by industry• The high-tech and manufacturing industries are more likely than the federal government, finance, health and state orlocal government industries to be having difficulty recruiting for certain types of full-time, regular positions.• The construction, mining, oil and gas and professional services industries are more likely than the federal governmentand state or local governments to be having difficulty recruiting for certain types of full-time, regular positions.•The finance and health industries are more likely than state or local governments to be having difficulty recruiting forcertain types of full-time, regular positions. Comparisons by industry Federal government (50%) High-tech (82%) Finance (66%) > Manufacturing (79%) Health (65%) State or local government (52%) Construction, mining, oil and gas (74%) Federal government (50%) > Professional services (70%) State or local government (52%) Finance (66%) > State or local government (52%) Health (65%)Note: Only statistically significant differences are shown. The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 8
  • 9. In general, what basic skills/knowledge gaps do job applicants have in your industry? Writing in English (grammar, spelling, etc.) 55% 48% Mathematics (computation) 38% 38% Reading comprehension (in English) 31% 30% English language (spoken) 29% 30% Science 14% 18% 13% 2012 (n = 1,928) Government/economics 11% 2011 (n = 597) Technical (computer, engineering, 11% mechanical, etc.) 7% Foreign languages 8% 8% Humanities/arts 2% 2% History/geography 2% 1% Other 9% 9%Note: Percentages do not total 100% due to multiple response options. Respondents whose organizations were not having adifficult time recruiting for certain types of full-time jobs were not asked this question. The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 9
  • 10. In general, what applied skills gaps do job applicants have in your industry? Critical thinking/problem solving 53% 54% Professionalism/work ethic 46% 44% Written communications 41% 41% Leadership 38% 39% Oral communications 34% 36% Teamwork/collaboration 33% 36% 2012 (n = 2,168) Information technology application 29% 2011 (n = 716) 30% Creativity/innovation 21% 25% Lifelong learning/self-direction 21% 21% Diversity 18% 17% Ethics/social responsibility 18% 19% Other 5% 5%Note: Percentages do not total 100% due to multiple response options. Respondents whose organizations were not having adifficult time recruiting for certain types of full-time jobs were not asked this question. The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 10
  • 11. Specific job categories for which organizations are having difficulty recruiting 88% Scientists 83% 86% Engineers 88% High-skilled technical 85% (e.g., technicians, programmers) 85% High-skilled medical 83% 2012 (e.g., nurses, doctors, specialists) 86% 2011 77% Managers and executives 78% 70% Skilled trades (e.g., electricians, carpenters) 68% 68% Sales representatives 72%Note: n = 242-1,344 (2012); n = 104-610 (2011). This figure represents “Somewhat difficult” and “Very difficult” responses. “Notapplicable” responses were excluded from this analysis. Only respondents whose organizations were having a difficult timerecruiting for certain types of full-time jobs were asked this question. The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 11
  • 12. Specific job categories for which organizations are having difficulty recruiting 53% Accounting and finance professionals 54% 49% HR professionals 49% 44% Production operators 52% 41% 2012 Drivers 36% 2011 34% Hourly laborers 29% 31% Customer service representatives 34% 21% Administrative support staff 24%Note: n = 242-1,344 (2012); n = 104-610 (2011). This figure represents “Somewhat difficult” and “Very difficult” responses. “Notapplicable” responses were excluded from this analysis. Only respondents whose organizations were having a difficult timerecruiting for certain types of full-time jobs were asked this question. The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 12
  • 13. The Impact of StrategicTechnological Changes The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 13
  • 14. In the last 12 months, has your organization made any major strategic changes involving the use of technology (e.g., robotics, computerized systems, software technologies) that affect the work of employees? 59% 30% 10% Yes No No, but we have plans to do so in the next 12 monthsNote: n = 3,324. Percentages do not total 100% due to rounding. The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 14
  • 15. In the last 12 months, has your organization made any major strategic changes involving the use of technology (e.g., robotics, computerized systems, software technologies) that affect the work of employees?Comparisons by industry• The health industry is more likely than the construction, mining, oil and gas; federal government; finance; high-tech;professional services and state or local government industries to have made any major strategic changes involving theuse of technology that affect the work of employees in the last 12 months. Comparisons by industry Construction, mining, oil and gas (27%) Federal government (28%) Finance (28%) Health (42%) > High-tech(24%) Professional services (28%) State or local government (26%)Note: Only statistically significant differences are shown. The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 15
  • 16. In the last 12 months, has your organization made any major strategic changes involving the use of technology (e.g., robotics, computerized systems, software technologies) that affect the work of employees?Comparisons by organization staff size• Organizations with 2,500 to 24,999 employees are more likely than organizations with 100 to 499 employees to havemade major strategic changes involving the use of technology that affect the work of employees in the last 12 months. Comparisons by organization staff size 2,500 to 24,999 employees (35%) > 100 to 499 employees (28%)Note: Only statistically significant differences are shown. The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 16
  • 17. As a result of these technological changes, has (or will) the total number of full-time, regular employees at your organization increased, stayed the same or decreased? 71% 16% 13% Increase Stay the same DecreaseNote: n = 1,345. Only respondents whose organizations made or planned to make any major strategic changes involving theuse of technology in the past 12 months or next 12 months were asked this question. The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 17
  • 18. As a result of these technological changes, has (or will) the total number of full-time, regular employees at your organization increased?Comparisons by industry• The high-tech industry is more likely than the federal government, health, professional services, and state or localgovernment industries to have an increase in the total number of full-time, regular employees as a result of recent orplanned technological changes.• The construction, mining, oil and gas; finance; and manufacturing industries are more likely than state or localgovernments to have an increase in the total number of full-time, regular employees as a result of recent or plannedtechnological changes. Comparisons by industry: Increase in total number of full-time, regular employees Federal government (10%) Health (15%) High-tech (37%) > Professional services (14%) State or local government (7%) Construction, mining, oil and gas (25%) Finance (18%) > State or local government (7%) Manufacturing(19%)Note: Only statistically significant differences are shown. The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 18
  • 19. As a result of these technological changes, has (or will) the total number of full-time, regular employees at your organization decreased?Comparisons by industry• The federal government is more likely than the construction, mining, oil and gas; health; high-tech; manufacturing;professional services; and state or local government industries to have a decrease in the total number of full-time, regularemployees as a result of recent or planned technological changes. Comparisons by industry: Decrease in total number of full-time, regular employees Construction, mining, oil and gas (8%) Health (11%) High-tech (9%) Federal government (33%) > Manufacturing(15%) Professional services (9%) State or local government (12%)Note: Only statistically significant differences are shown. The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 19
  • 20. As a result of these technological changes, has (or will) the total number of full-time, regular employees at your organization decreased?Comparisons by organization staff size• Organizations with 25,000 or more employees are more likely than organizations with 1 to 499 employees to have adecrease in the total number of full-time, regular employees as a result of recent or planned technological changes. Comparisons by organization staff size: Decrease in total number of full-time, regular employees 1 to 99 employees (9%) 25,000 or more employees (27%) > 100 to 499 employees (9%)Note: Only statistically significant differences are shown. The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 20
  • 21. How have (or will) these technological changes affected the employee skills required in your organization? 72% 18% 10%we do not need to hire new staff (e.g., existing staff can be trained iffor which we need to hire new staff Require the same skills Require new skills, necessary) Note: n = 1,345. Only respondents whose organizations made or planned to make any major strategic changes involving the use of technology in the past 12 months or next 12 months were asked this question. The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 21
  • 22. How have (or will) these technological changes affected the employee skills required in your organization?Comparisons by industry• The finance and professional services industries are more likely than the health and state or local government industriesto require the same skills for employees as a result of technological changes.• The finance industry is more likely than the manufacturing industry to require the same skills for employees as a result oftechnological changes. Comparisons by industry: Require the same skills Finance(31%) Health (11%) > Professional services (27%) State or local government (14%) Finance(31%) > Manufacturing(16%)• The health and state or local government industries are more likely than the finance, high-tech and professional servicesindustries to require new skills, but they do not need to hire new staff as a result of technological changes. Comparisons by industry: Require new skills, but do not need to hire new staff Finance(61%) Health (81%) > High-tech (56%) State or local government (81%) Professional services (66%)Note: Only statistically significant differences are shown. The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 22
  • 23. How have (or will) these technological changes affected the employee skills required in your organization?Comparisons by industry (continued)• The high-tech industry is more likely than the finance, health, professional services, and state or local governmentindustries to require new skills and need to hire new staff as a result of technological changes. Comparisons by industry: Require new skills and need to hire new staff Finance(8%) Health (8%) High-tech (24%) > Professional services (8%) State or local government (6%)Note: Only statistically significant differences are shown. The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 23
  • 24. How have (or will) these technological changes affected the employee skills required in your organization?Comparisons by organization staff size• Organizations with 1 to 99 employees are more likely than organizations with 500 to 25,000 employees to require thesame skills for employees as a result of technological changes.• Organizations with 100 to 499 employees are more likely than organizations with 500 to 2,499 employees to require thesame skills for employees as a result of technological changes. Comparisons by organization staff size: Require the same skills 500 to 2,499 employees (12%) 1 to 99 employees (25%) > 2,500 to 24,999 employees (14%) 100 to 499 employees (21%) > 500 to 2,499 employees (12%)Note: Only statistically significant differences are shown. The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 24
  • 25. Demographics The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 25
  • 26. Demographics: Organization Industry State or local government 20% Manufacturing 14% Professional services 13% Health 13% Finance 11% Construction, mining, oil and gas 10% High-tech 7% Federal government 7% Other 6%Note: n = 3,481. Percentages do not total 100% due to rounding. The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 26
  • 27. Demographics: Organization Sector Privately owned for-profit 43% Government 25% Publicly owned for-profit 17% Nonprofit 12% Other 3%n = 3,294 The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 27
  • 28. Demographics: Organization Staff Size 1 to 99 employees 26% 100 to 499 employees 33% 500 to 2,499 employees 19% 2,500 to 24,999 employees 16% 25,000 or more employees 6%n = 3,208 The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 28
  • 29. Demographics: OtherDoes your organization have U.S.- Is your organization a single-unit organization orbased operations (business units) only, a multi-unit organization?or does it operate multinationally? Single-unit organization: An organization U.S.-based operations only 76% in which the location and the 36% organization are one and the same. Multinational operations 24% Multi-unit organization: An organization 64% that has more than one location. n = 3,311 n = 3,325 For multi-unit organizations, are HR policies andWhat is the HR department/function for practices determined by the multi-unit headquarters,which you responded throughout this by each work location or by both?survey? Multi-unit headquarters determines HR Corporate (companywide) 68% 50% policies and practices Business unit/division 19% Each work location determines HR 3% policies and practices Facility/location 13% A combination of both the work location n = 2,206 and the multi-unit headquarters 47% determines HR policies and practices n = 2,204 The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 29
  • 30. SHRM Survey Findings: The Ongoing Impact of the Recession—Overall Financial Health and HiringSurvey Methodology• Response rate = 15%• 3,481 HR professionals from a randomly selected sample of SHRM’s membership participated in this survey• Margin of error +/-2%• Survey fielded August 28–September 14, 2012 30
  • 31. About SHRM Research• For more survey/poll findings, visit www.shrm.org/surveys• For more information about SHRM’s Customized Research Services, visit www.shrm.org/customizedresearch• Follow us on Twitter @SHRM_ResearchProject leader: Tanya Mulvey, survey research analyst, SHRM ResearchProject contributors: Alexander Alonso, Ph.D., SPHR, vice president, SHRM Research Evren Esen, manager, Survey Research Center, SHRM Research Jennifer Schramm, GPHR, manager, Workplace Trends and Forecasting, SHRM ResearchCopy editor: Katya Scanlan, SHRM Knowledge Center The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013 31