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Private-sector jobs: a ‘lost decade’

Unemployment rates, by education level

Teenagers’ unemployment rate, by race

Employment-population ratio

Unemployment, and under-employment

Preparing for Future Changes in the Workforce: Emerging Trends

January 18, 2011

“A Differentiated and Memorable Customer Experience”

• Customized products– iTunes

• Negotiated prices– Not Y

• Flexible places– iPod– iPhone

• Targeted promotion– “hulu effect”

“A Differentiated and Memorable Employee Experience”

• Customized construct– Box vs. amoeba

• Negotiated compensation– More than dollars

• Flexible connection– “company man”

• Targeted communication– Info the way I want it

Most Critical Changes

• Diversity/Immigration• Education• 4 generations

– aging population

Diversity and Immigration

Origins

Caribbean

Cent. Am

South Am.

Europe

AsiaOther

0%

10%

20%

30%

40%

54% of all immigrants in US

Small but growing

Native-Born Total Foreign-Born

84%

16%

Educational Attainment

<HS High School Some College BA/BS

5.8%

29.7% 30.0%

34.5%

26.4%25.1%

16.4%

31.1%

Native Born Foreign Born

52%

Foreign-Born Shares

Total Pop. All workers Low-wage workers Lower-skilled workers

11%14%

19%

38%

12%

16%

21%

45%

2000 2005

Skill Levels

• 42% said “adequate”

• 25% moderate deficiencies

• 7% severe deficiencies

Note the differences…..

Project-mgt skills

Team work

Poor employability

Verbal communication

Written communica-tion

English language

0% 20% 40% 60% 80% 100%

6%

10%

15%

65%

72%

84%

Hispanic/Latino

• 15.1% of US population• 50% of total growth 2000-2007• Politicians will be politicians……..

EDUKASHUN LEVELS

(OR JACK AND JILL CAN’T READ…OR ADD….OR SUBTRACT…..OR……)

Knowledge workers

• What is a “job?”• Self-managed• Constantly innovate• Continuous learning• Quality counts• Asset, not cost

Fastest growing industries (2008-2018)

Semi-cond.

Science R&D

Med. Equip mfg

Fin. Invest.

A/V mfg

Data/info services

Software

Computer/peripheral mfg

5.9%

6.1%

6.3%

7.3%

8.4%

9.3%

10.5%17.0%

The International Context (top 30)

• 16th in reading skills

• 20th in science

• 26th in math

• 25th in problem solving

Educational Attainment by Race and Ethnicity

1980

1985

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

20

0120

0220

0320

0420

0520

0620

070

10

20

30

40

50

60

White Black Asian Hispanic

5%

5.2%

Fastest growing industries (2008-2018)

Semi-cond.

Science R&D

Med. Equip mfg

Fin. Invest.

A/V mfg

Data/info services

Software

Computer/peripheral mfg

5.9%

6.1%

6.3%

7.3%

8.4%

9.3%

10.5%17.0%

Undergraduate Degrees (top 30)

• 17.6% in science (19th)

• 6% in natural science (8th)

• 3.9% in math/computer science (12th)

• 6.4% in engineering (21st)

Undergraduate Degrees

1980 1990 2000 2002 2003 2004 2005 20060

10000

20000

30000

40000

50000

60000

70000

80000

IS Engineering Math Science

63%34%

2006

They’re not staying…..

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

-10%

0%

10%

20%

30%

40%

50%

60%

70%

Sci. Temp. Sci. Perm. Eng. Temp. Eng. Perm.

So What’s A Poor Boy to Do?

R&D as % GDP1996

No Am – 38.7% Europe – 28.9% Asia - 27.7%

2005 No Am – 35.1% Europe – 25.7% Asia - 34.4%

Higher-Skilled Immigrants

• H1-B– 3 yrs (extendable for 3 yrs)– 65,000 annually (+/- 2 months)– Can apply for “green card”

• Praise– Only way to offset shortage of native-borns

Higher-Skilled Immigants

• Criticisms– “corporate subsidy”

• Not a shortage of native-borns• Depresses wages• Eliminates native-born jobs (AIG)• “indentured servants”

India as High Tech Center

• H1-B visas• 20% Microsoft software engineers• 38% of 2008 H1B holders from India

China?????

• Questionable numbers• Questionable quality• Questionable supply for internal needs

4 GENERATIONS AND AN AGING WORKFORCE

Hot off the presses (1)……• Predicted number of new jobs?

– 525,000 +/-

• How many new jobs?– 431,000

• How many Census jobs?– 411,000

• Unemployment rate?– 9.9% (April)– 9.7% (May)– 322,000 left workforce

Age of Workers

16-24 25-34 35-44 45-54 55-64 65+-20%

0%

20%

40%

60%

80%

5% 5%

-9%

18%

48%

15%

Percent Growth in U.S. Population by Age: 2000-2010

Different Patterns of Growth by Age

1. Declining number of mid-career workers

2. Few younger workers entering

3. Rapid growth in the over-55 workforce

Source: US Census Bureau International Data Base

. . . Continuing for some time

Age of Workers

Percent Growth in U.S. Workforce by Age: 2000-2020

under 14 15-24 25-34 35-44 45-55 55-64 65+-20%

0%

20%

40%

60%

80%

7% 8% 7%

-10%

3%

73%

54%

Source: US Census Bureau International Data Base

In 2000, Fairly “Young”

Under 5% 5% to 12.4% 12.5% to 20% Above 20%

Source: U.S. Census BureauPercent of Population Age 60+ 2000

. . . Rapidly Aging by 2025

Source: U.S. Census Bureau

Under 5% 5% to 12.4% 12.5% to 20% Above 20%

Percent of Population Age 60+ 2025

Life Expectancy at Birth: 1000 - 2000

Source: Census Bureau, 2000

Age

1000 1200 1400 1600 1800 1900 2000

2530

35 3638

47

76.5

Dramatic Drop in Birth Rates

Source: Age Wave

Tota

l Fer

tility

Rat

e

US UK France Canada Japan Germany Italy0

1

2

3

4

3.3

2.8 2.9

3.6

2.0

2.5 2.5

2.0

1.7 1.7 1.61.4 1.3 1.2

1960 20002.1

Four Generations

By the numbers….

76

46

80

75

0

20

40

60

80

Mill

ions

Yers Xers Boomers Matures

Veterans/Matures/Silent Generation

• 1924-1945

Matures

• Loyal• Work is good because it is work• Respect discipline and authority• Common good, not individual good• Don’t like change

Baby Boomers

• 1946-1964

To sum them up…..

• “Me” generation

• Money, title, recognition

• Very competitive

• Build a stellar career

• Workaholics – but now?

And one final comment….

Hot off the presses (2)….

• Employee Benefit Research Institute• Sources of income for 36.5 m Americans >=65

– Social Security (40%)– Pensions/annuities (20%)– Assets (13%)– Earnings (26%)

• The clear message to you is…………..

Xers or Generation X

• 1965-1980

To sum them up….

• Misunderstood

• Very distrustful of institutions

• Flexible and motivated

• Work and life must balance

• Build a portable career

To sum them up….

• Value diversity• Embrace change• Searching for meaningful work• Confident• REALISTIC• UNREALISTIC

Do twentysomethings in your workplace?

• Offer a fresh perspective 8% • Serve as a great source of new talent 17% • Really 'get' the latest tech 7% • Expect too much 30% • Show too little loyalty 14% • Don't have much impact 24%

The Three Big UnknownsAbout The Emerging Workforce

Immigration Will nations change policies to encourage faster immigration?

Outsourcing How fast will it develop? Where?

Retirement Average retirement age continues to lower More retirees remain active Will the average retirement age change?

Source: Demography is De$tiny, The Concours Group and Age Wave, 2003

Workforce challenges

• Limited in availability• Chronologically older• Lacking key skills• Global• Highly diverse• Sharing only health as a core value

Source: Testimony by Tamara J. Erickson to the Senate Committee on Health, Education, Labor and Pensions, May 2005

Complicated by the Changing Nature of Work

• Conducive to small firms • Virtual and becoming more so• Based on experimentation and

coordination - innovation• Difficult to standardize• Linked by personal technology• Democratic and/or market-based

Source: Testimony by Tamara J. Erickson to the Senate Committee on Health, Education, Labor and Pensions, May 2005