Updated: Wed, 11/28/2012 - 01:00

Ending the great recession and the need for skilled employees

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In Part 2 of this series, I contrasted the radical changes that have occurred between corporate hiring practices of not so long ago with the environment job seekers are faced with today. In this part, I’ll share some behaviors, as I see them, that got us into this sorry state.

In many cases, there’s now a preference for hiring temporary workers, rather than in-house employees.

Temporary or contract workers are far cheaper to hire than in-house employees who qualify for benefits like health insurance and the retirement program. The company owes no loyalty to temps or contractors; they can be hired and fired at will.

Corporations no longer seek employees with “potential” or experience in parallel or complementary industries when hiring full-time staff

Major corporations have ceased to think long term in many areas, shifting their focus nearly exclusively to near-term actions that produce short-term results. Examples of this myopic view range from focusing on the next quarter’s stock earnings per share to viewing employees as a short-term commodity rather than long-term assets, as I shared in part one.

Viewing employees as a commodity results in corporate behavior of hiring what’s needed for the moment and discharging them when the immediate need disappears, which in turn results in a goal of only searching for and hiring employees “who can make an immediate contribution to the bottom line.”

This practice also impacts the productivity of the employees who do make it on to the payroll because they know they will be back out the door when the company decides their pay exceeds their usefulness, so they spend some of their work time trolling for the next job so they can continue to feed their families on a regular basis.

And, hey, if they can find a better position before the current one expires, why not leave early and take it? I recently read the results of a poll that said fully 66 percent of all full-time employees search for a new job on a regular basis.

During the Great Recession most large corporations returned to profitability through extreme cost cutting, mostly through layoffs in their labor force.

Employees who survived the purges were told to take on the extra responsibilities of their former colleagues, so technically the same amount of work is being performed by fewer people, which is responsible for the great gains in national productivity figures and widely reported in the media.

This approach obviously places all the necessary skill set eggs into fewer baskets, which also creates predictable problems when the new multi-taskers leave and corporations try to replace them with someone who can do the newly defined mega-job rather than spreading skills (and risk) over several employees.

New-hire employees are now expected to be the master of newly created mega-jobs, while simultaneously “hitting the ground running.” Like a new electronic gadget, a new employee should be able to “work right out of the box.”

This new expectation was unheard of only a few years ago when employees were a valuable asset to be invested in over the long term. New hires weren’t expected to be able to make meaningful contributions until they had been with a corporation long enough to learn the ropes.

For example, The New Yorker Magazine reports that in 1979 every young worker received an average of 2½ weeks of training upon hire. Last year fewer than a quarter received any training at all.

Compounding this trend, most hiring authorities no longer even make the effort to understand the skill set actually required to perform the job they’re hiring for. So advanced degrees, myriad commercial certificates and recent experience in everything are specified in the hope that the overkill will result in a person eventually hired who can do the job.

For example, you may not need an engineer with an MBA to be the head of a maintenance department. The better candidate may well be a military veteran non-commissioned officer (NCO) who successfully ran a repair depot.

Hiring the former NCO would bring superb talent and a broad background into the organization, could probably be hired at a substantial savings for the company and may stay with the company longer than the highly credentialed engineer who is intent on furthering his career climbing the corporate ladder.

Stay tuned

Staffing only for the short term and then over-specifying requirements for vacant positions are corporate behaviors contributing to the so called “talent shortage.” In part three, I’ll list more corporate behaviors that are contributing to our economic woes.

Do you agree so far? I’ll look forward to your feedback at results@bgaccelerators.com.

Dan Elder is a business coach, management consultant, speaker, and author of The Business Growth Accelerators Guide to Dramatic Business Growth in the Face of Fierce Competition on Amazon.com. Learn more at www.bgaccelerators.com.

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