Slow job creation is just part of the unemployment problem

By most accounts, the nation has weathered the worst economic
downtown since The Great Depression.  But mere survival just won’t
be good enough this time around to transform our workforce back to
greatness.

It’s no secret that our recovery has been hampered by slow job
growth.  Our economy thrives when we people have good jobs with good
wages. These wages are used to buy more things which puts more people
back to work. The more demand for products and services, the more jobs
we create. The economy grows when we provide a world class education to
the next generations of innovators and inventors, who then become
entrepreneurs, artists, scientists and thinkers that create new jobs.
The problem this time is that we haven’t created enough new jobs fast
enough, at least jobs that are based in the U.S.

Slow job creation however is just part of the problem. A much more
significant cause is a shift in the nature of work and type of jobs
being created.  Even when jobs created in 2011 have the same title as
those created in 1991, the skill requirements are drastically different.
 According to consulting giant McKinsey & Co., nearly 85% of new
jobs created between 1998 and 2006 involved complex “knowledge work”
like problem-solving and sculpting corporate strategy. That scenario has
scripted a dramatic gap in the workplace between candidates seeking
jobs and their qualifications required to fill them.

To make my point, a friend of my wife recently lost her job.  She
worked in banking and the mortgage business for nearly 30 years.  You
couldn’t ask for a more conscientious, honest, hard-working person.  Her
next employer would get an employee of the highest character, if that’s
all the counted.  But Betty (not her real name) lacked the skills most
employers require these days. Unfortunately Betty didn’t recognize the
skill gap.  When I asked her to describe her computer skills, she
proudly shared she was “really good with Quickbooks and email.” But when
I asked her about her proficiency with Word and Excel, she responded,
“I’m really just too old to learn that stuff. That’s for younger
people.”

And that’s the problem.  Computer skills – which today accounts for
so much more than checking email and typing letters – aren’t just skills
you can pass off onto “young people.”  Every worker – regardless of age
– needs them along with minimum levels of proficiency with software and
Internet skills.  Employees also need the ability to adapt,
collaborate, think critically, and even work virtually.  Unfortunately
the labor pool is filled with a lot of job seekers named Betty.

To learn more about how this job restructuring is impacting our recovery and shaping the Future of Work,  let’s begin by describing a few terms associated with the nature of work:

Transformational: Jobs that involve the extraction of raw
material and converting them into finished goods.  Examples of
transformational jobs are mining coal, running heavy machinery, or
production line workers.  Once the type of job that defined progress and
a robust economy, only 15% of American workers took jobs in this
category by the turn of the 21st century.

Transactional: Jobs that involve routine interactions.
Examples of transactional jobs would be cashiers, office and accounting
clerks.  Most of these jobs have become commodities and if not already
outsourced, they’ve become automated.

Tacit: Jobs that involve more complex interactions –
knowledge jobs. Examples of jobs in this category would include
Executive/Manager, Nurse, Salespeople, and Mediators.  Many experts
would even include positions like customer service representatives.
Today even the CSR requires a vast knowledge base and advanced skills to
service a diverse population who present complex problems.

For many years, companies have followed the Alfred Sloan pyramid
style of business: a limited amount of tacit type of workers at the top
supported by a large base of transformational and transactional types of
workers.  This organizational model just isn’t working anymore. A new
global marketplace demands an increase in the tacit workforce. It
demands a new way of thinking.  No one is going to pay workers anymore
just to show up. 

Or as Edward Gordon, author of “Winning the Global Talent Showdown
explains it , “we only have 20% to 25% of the current workforce that
fits into jobs that are in high demand right now…”  Gordon describes
this as, “An abundance of labor, and poverty of talent.”  

In other words, despite high unemployment rates, the U.S. does not
have enough people with the right skills to fill the jobs that are being
created. We do however have an ample supply of people ready, willing,
and able to fill jobs that are or should be obsolete. That gap between job openings and skilled workers will keep unemployment high even if job creation ramps up.

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