Talent Acquisition - Chapter 5 (week 4)

The New Normal

In today’s rapidly evolving landscape, we’re witnessing what pundits call the new normal across technological advancements, demographic shifts, and changes in the labor force. And societal transformations. These trends not only redefine the way we work and interact, but they also present unique challenges and opportunities in business and talent management.

The VUCA era

volatility, uncertainty, complexity, and ambiguity.

PESTLE ANALYSIS: The U.S Talent Market

is a strategic tool used to identify and analyze the key external factors that can impact an organization or business

What does PESTLE stand for?

• Political - Government policies, regulations, stability, tax policies, trade restrictions, etc.

• Economic - Inflation rates, interest rates, economic growth, unemployment, consumer spending, etc.

• Social - cultural trends, demographics, health consciousness, education levels, etc.

• Technological- Innovation, automation, research and development, technology advances/adoption, etc.

• Legal- laws, regulations, labor laws, consumer protection, industry-specific rules, etc.

• Environmental - Climate, environmental regulations, sustainability issues, and ecological factors. 

Workforce characteristics examples

Age: The median age of a worker is 42, and 34% of the workforce is 50 or older

Education: Only 33% of the labor force has a BA or higher degree. The share of workers with some college or a high school diploma has declined since 200.

Working longer

Race and ethnicity: The U.S workforce is 76.5%  white, 12.8% Black or African American, 18.8% Hispanic or Latino, and 6.9% asian. 

Gender: 46.9% of the civilian labor force is women. 

Wage differential: on average, women working f/t, year-round are paid 84% of what men are paid. 

Nativity: 19% of workers are immigrants. 

Political shifts

• Tariffs

• Immigration Practices 

• Federal Grant Eliminations 

• DEI rollbacks

• Federal WF reductions

• Federal agency cutbacks 

• Education and WF development investment 

Social changes

• A more diverse population

• Women at work

• An aging population

• Generational shifts

• Educational attainment

• Shifts in employee expectations

• Employee discontent

• Disabled workers

• The return of unionization

• Changing social norms and attitudes

Women at Work 

While women’s representation in the workforce is around 47%, they only make up 28% of executives in the top leadership teams of the S&P 100. 

Aging population

Workers ages 75 and older are the fastest-growing age group in the workforce, more than quadrupling in size since 1964.

Generational Shifts 

There are currently 5 generations in the workplace

• Silent Generation (Before 1945)

• Baby boomers (1946-1964)

  • Demographic- came of age during the country’s highest birthrates 

• Gen X ( 1965-1980)

  • Economic- came of age during significant economic restructuring

• Gen Y (1981-1995)

  • Social- came of age during social changes in schooling and parenting

• Gen Z(1996-present) 

  • Technological- came of age as the i-generation, and are on the rise.

General changes in attitudes about work

Key aspects of changing attitudes about work:

• Focus on personal values

• Work-life balance

• Meaningful work

• Employee autonomy

• Positive workplace culture

• Recognition and rewards 

Employee discontent

Workers' confidence has dropped to a new low 

Disabled workers

People with disabilities have lower employment population ratios, higher unemployment rates, are are more likely to work part-time than people without disabilities. 

The return of unionization and worker advocacy

As of 2024, approximately 9.9% of U.S workers were union members, making a slight decline from 10% in 2023 (Reuters). This represents a significant decrease from 20.1% in 1983. 

Changing social norms + attitudes

• Political division

• Freedom of speech/censorship

• Racial inequality/social justice

• Gender equality 

• Marriage 

• Nationalism v. Globalism

• Faith in institutions

• Religion

• Climate change

• Gun control

• Abortion

• Lgbtq rights

• Animal welfare

Technological advances

• Commodization of technology 

• Exploding internet usage

• Big data platforms

• Social media

• E-learning 

• AI and machine learning applications 

• Semiconductor and computing power 

• Digitalization 

Legal + regulatory updates 

• Overtime and wage rule changes

• Worker classifications

• Non-compete clause enforceability 

• Workers’ rights

• Energy and climate policies 

• AI and technology regulations 

• NLRB

Environmental concerns 

• EPA rollbacks

• EPA de-regulation

• Changes to renewable energy policies 

• Drilling, wind, solar, etc.

• Sustainability issues

• Ecological factors 

Workforce Planning 

What skills do we have today, what do we need tomorrow?

It's the process of ensuring than an organization has the right people, with the right skills, in the right roles, at the right time, to meet its current and future business needs. 

Benefits of Workforce Planning

• Ensure that you have the right resources when you need them

• Determine the best workforce structure

• Predict work trends

• Provide insight into strategic initiatives 

• Align HR with organizational strategy

• Manage risk or trade-offs associated with staffing decisions

4 types of workforce planning

1. Strategic workforce planning- long-term, typically looking 3-5 years ahead, focusing on aligning workforce capabilities with organizational goals.

2. Operational Workforce Planning

3. Succession planning - A specialized form of workforce planning that ensures leadership continuity by preparing employees to step into critical roles as others retire or move on. 

4. Contingent workforce planning.

5 steps of workforce planning

1. Understand the current and future business goals

2. Identifying the capacity and capability of your current workforce to meet these goals

3. Forecasting the capacity and capability of the workforce you think you will need 

4. Identify gaps and use the information to guide the development of your workforce strategy

5. Review and evaluate the strategy you've got in place 

Know your current and future business goals

Understand/define your business strategy and objectives. Ensure HR alignment.

• For HR to effectively support the business, we must understand the company’s goals, challenges, and industry dynamics. By knowing the business inside and out, HR can make strategic decisions that directly contribute to organizational success, drive business success, adapt to change, improve employee experience, and enhance.

Assess your current workforce (supply) 

Prioritize critical roles and assess the existing workforce to identify gaps in skills, experience, and knowledge. This involves evaluating employee performance, skills, inventories, and potential for development for assets and limitations

• Skills inventories - a detailed record or database that summarizes each employer’s skills, competencies, and qualifications. 

• Analyze present performance, promotion readiness, potential, and development needs.

• Assess teamwork and leadership capabilities

• Consider the talent pipeline: replacement and succession

• Consider “critical” and specialized positions

• Consider historical trends and key headcount ratios: attrition, retirement, productivity, etc.

• Conduct a SWOT and PESTLE analysis 

Project Future WF

Business forecast labor forecast 

Forecasting your WF involves predicting the organization’s future talent requirements based on anticipated business activity and needs, which depend on its business strategy. Forecasting steps:

Speak to organizational leaders,

Locate/research reliable, high-quality information sources within and outside of the organization to forecast business needs and related talent requirements.

Given the uncertainty of forecasts, construct estimates as a range, providing low, probable, and high estimates. Recalculate these estimates as changes happen in the organization’s internal and external environments and as the firm’s assumptions and expectations change. 

The forecast should be scenario-based 

Identify and address the gaps 

Compare current vs future skills

• Create a skills matrix to visualize the gaps that exist. 

• Categorize skills as 

  • Existing and sufficient

  • Existing but insufficient

  • Existing but not needed in the future

  • Not currently present but needed in the future

Succession management

an ongoing process of systematically identifying, assessing, and developing an organization’s leadership capabilities to enhance its performance

Success management plans

written policies that guide the succession management process

Replacement planning

the process of creating back-up candidates for specific senior management positions…

Succession planning candidate consideration 

• 9-box matrix grid

• Experience, education, skills, performance & potential, motivation and career goals, readiness, learning aptitude, culture agility, DEI, risk/impact of loss, comparison to market, leadership capacity.

What makes succession management effective 

Understanding the nature of talent gaps with enough time before the talent is needed can allow the organization to 

• Plan for and remedy any workforce talent deficiencies

• Develop an external recruiting strategy to bring in external talent

• Redesign the work to reduce the need for the talent expected to be in short supply

• Plan alternate career paths for surplus talent

The succession management process needs to make sense to and be usable by different business units.

• A standardized process can help to focus and guide the development of employees to meet the strategic needs of the organization and increase employee perceptions of the program’s fairness by reducing opportunities for favoritism.

• The process should also align with other human resources processes, including recruitment, selection, rewards, training, and performance management.

• Continually evaluate and improve the system.

Succession Management Tips 

• Keep the process simple

• Use technology to support the process

• Align your succession management plan with your firm’s overall business strategy

• Focus on development

• Model effective succession management behaviors at the top

• Approach succession management as a key business activity