Work Force Challenges
Despite the improving economy, we'll continue to struggle with difficult work force challenges in 2011.
Despite the improving economy, we'll continue to struggle with difficult work force challenges in 2011, as companies find themselves dealing with such problems as disengaged employees, skills atrophy and worker resentment.
That forecast comes from Rick Dacri, a human resources consultant and author of the book, "Uncomplicating Management." I spoke with Dacri earlier today, and he provided 10 predictions on what to expect in the realm of work force management in the coming year:
- Hiring will be up. Throughout 2011, hiring will increase, slowly, but steadily. Watch for targeted hiring as employers focus on key employees who can make an immediate contribution in the company's core business. Previously, too many companies responded to productivity problems by throwing people at them. Now, hiring for the sake of hiring is dead.
- Turnover will increase. As employees become more confident of an improving economy, many will bail. Pent up frustrations with cuts in pay and benefits, watching fellow employees lose their jobs and fatigue due to working more with less will push workers to begin searching for greener pastures. At the same time, employers' star performers will be targeted by external recruiters for poaching. As business improves, key staff will be needed and those unprotected and unappreciated stars will become vulnerable and open to a recruiter's pitch.
- Contingent hires will reign. Though the economy is improving, employers will focus their hiring on temporary workers as a hedge. Confidence is not high so employers will depend on temps realizing their work force can expand and contract easier with them. Temp agency businesses will boom in 2011. Watch for significant hiring of temps, part-timers and independent contractors.
- Cost reductions will continue. Employers will continue to search for ways to cut costs. Labor costs and health care insurance will be the biggest targets. While employers struggle to keep these two line items in check, they will be forced to address the need to remain competitive. Cutting too much will drive employees out-potentially into the hands of competitors; cut too little and employers will watch their bottom line erode. Employers will struggle to keep the balance.
- Layoffs will continue. Though hiring will increase, expect to see employers cutting labor at the same time. In fact, more employers will be hiring and firing simultaneously. In this new economy, employers will continue to focus on their core business, hiring needed and critical talent for their core business while quickly shedding "unnecessary" workers elsewhere. Lean and mean will be the new mantra.
- Employee engagement will continue to drop. Employee engagement has been dropping for several years and will continue in 2011. Workplace stress, fatigue and anger have turned employees off and the last two years have been especially hard on employees. With disengagement, employer's productivity gains will be at serious risk. Employers who successfully address this problem will see business soar in 2011.
- Training will increase. Employers will begin investing in all aspects of employee training. Training was among the first things to go during the recession and employers are beginning to feel the effects. Skill atrophy has set in, especially among workers who have been out of work for over a year. As employers push for greater productivity with less labor, the need for trained talent will be critical.
- Social networking will become more mainstream. More employers will turn to social networking to recruit and also to communicate directly with their employees. No longer will it be seen as a productivity drain or an employee distraction. Employers will utilize it as a valuable and cost effective tool.
- Employment lawsuits will increase. As more older and higher paid workers get pink slips while the unemployed struggle to find jobs, more will turn to the courts for remedy. Watch for more age discrimination and wrongful discharge suits. In addition, as more contingent workers are hired, more claims around worker misclassifications will occur, putting a chill on future hiring.
- Succession planning will be more in vogue. More and more organizations and boards of directors will slowly begin to realize that many of their key employees and leadership are getting older. Employers begin to understand that they must prepare for the potential losses of this critical talent and start to put in place succession plans.