In the end, it could become a critical disconnect in the C-suite, with leaders seeing a talent shortage ahead—but just not in their own backyards.
According to a new Korn Ferry survey of 1,500 leaders around the world, 66% said that there will be a shortage of talent by 2020. Slightly more than half said that there’d likely still be a shortage by 2030. But the survey also found a key disconnect: 95% of leaders express confidence that their own organization can meet its future talent needs. Nearly three-quarters of the leaders believe technology will overtake people as their organization’s most valuable asset.
Experts say this mentality could cost businesses dearly, according to a new Korn Ferry report. The talent shortage isn’t a passing phenomenon, but a structural change that could cost firms nearly $8.5 trillion in lost revenue by 2030. “The lack of skilled workers needed to drive business strategy could be the defining issue of the age, threatening the GDP of nations as well as the profitability of organizations,” says Alan Guarino, vice chairman of Korn Ferry’s CEO and Board Services practice.
The expected shortages are not limited to any geography. China, for instance, may have a deficit of 6.7 million highly skilled workers by 2030, with the United States right behind it with a deficit of 6.6 million workers. Five other countries could have deficits of 2 million or more workers.
With so many leaders not seeing any shortages in their camps, experts worry they be could underinvesting in talent training programs or an overall talent strategy. If organizations don’t make workforce planning a priority, they will likely find themselves constrained by a lack of skills. Worse, they’ll have to pay up for the talent they do hire. Korn Ferry estimates that the global talent shortage could inflate salaries by $2.5 trillion by 2030.
Organizations can act now to avoid future talent shortages. The report lays out several tactics to better identify potential talent and train them in the skills that the organization will need now and in the future. “There are huge untapped pools of talent already available in most organizations; the challenge is in identifying them,” says Cynthia Stuckey, a Korn Ferry senior client partner.