The Shrinking Workforce
Future’s Ramblings – Issue 6 – January 29, 2005
I have been think a lot about Peter Geyer’s Chris Kringle. For those of you in Brisbane and Melbourne let me describe the gift: A very very VERY large pair of white underpants, Y front briefs to be exact. On the back was stenciled the word STRATEGIC. Like the rest of us in the Sydney practice I thought the gift was quite hilarious, now after a bit more reading and thinking about it my thoughts have gone from humor to fear. You might ask, what is so scary about a huge pair of underpants?
What is so scary is that those are big drawers to fill, and Peter is not the only one in this organization sporting big drawers.
In a previous version of Futures Rambeling I made reference to a problem that will be one of the key challenges that dominate the world of work in 2005, that is the shrinking workforce. It is not a new problem we have been talking about it for some time now, but it is becoming more urgent and some say it will be a dominating factor in the world of work in 2005. Developing economies around the world are facing an impending talent shortage that will make competing for business seem simple compared to competing for skilled workers. Finding good people will be a major aspect of many companies future success, and we may see companies going under not for lack of business but lack of workers.
There are many reasons this is occurring. There are fewer new, or “emergent workers”, some estimate we are roughly about 10 million knowledge workers short to meet our demand for the next five years. In addition to fewer new employees, the baby boomers will soon retire and when they walk out the door we will not just lose their bodies we will also lose the critical knowledge, important relationships, and wisdom about how to get things done.
In his book Lost Knowledge David DeLong describes four distinct types of knowledge that are important for organizations, the loss of any one of them can be devastating:
Human knowledge – basic intelligence, information, and skills
Social knowledge – embedded in relationships, some call this “social capital”
Cultural knowledge – that collective understanding of how things get done around here, in particular the values, norms, and shared assumptions that differentiate one organization from another
Structured knowledge – the formal systems, processes, and procedures that have been developed within an organization.
Beyond the four types of knowledge listed above there is something else we would lose when some people leave the work force ( I had to say some people because many of the baby boomers don’t have this due to extreme drug abuse) the Harvard Business Journal calls it “Deep Smarts”. It is not raw brain power, it is not emotional intelligence either, it is the ability to see the complete picture and yet zoom in on a specific problem. Almost intuitively people with deep smarts make the right decision, at the right level with the right people. These are people whose knowledge would be hard to purchase on the open market, and in fact these “intangible” asset are increasingly recognized as legitimate sources of worth or merit in the global business context.