Latest study commissioned by Korn Ferry revealed that recent phenomenon of skilled talent shortages will continue to threaten global economic development and even bring significant impact on major economies by 2030. The Global Talent Crunch study indicates the world will be on deficit of more than 85.2 million workers by the year, with nearly $8.5 trillion revenue opportunity could be lost if the issue is not addressed.
The study analysed the gap between future talent supply and demand in 20 major economies across three sectors, including financial and business services; technology, media, and telecommunications (TMT); and manufacturing. As a result, Korn Ferry found that financial and business services suffer from the most severe labor shortages. By 2030, it is estimated to see a potential deficit of 10.7 million workers globally, which would cause the sector to lose out on annual revenues of $1.3 trillion.
Meanwhile, despite the high demands for skilled talents in TMT industry, the sector still face an acute global labour crunch of 4.3 million workers by 2030. Unless this issue is addressed, this could cost in hampering technological advancements across all sectors of the economy. The manufacturing sector is also facing critical talent deficit crisis as it will be lack of 7.9 million workers globally by 2030, despite being the only sector with a surplus of highly skilled workers in 2020.
Regarding the findings, the vice chairman of Korn Ferry CEO and Board Services Alan Guarino said, “The world can’t afford to have tens of millions of unfilled jobs and trillions of dollars in unrealized revenue. Companies must work to mitigate this potential talent crisis now to protect their future. If nothing is done, this shortage will debilitate the growth of key global markets and sectors.”
Further, the research also pointed out that there is a significant mismatch between supply of available workers and business demands at country level. According to the data analysis, developed markets will be hit hardest by imminent talent shortages for the next few years. Among the countries that will face the largest threat are Australia, France, Germany, Japan and the U.S., with a combined opportunity cost of $1.876 trillion in annual revenues by 2020.
In the U.S. itself, shortage of skilled workers is expected to worsen in the near future. It could leave $1.748 trillion of annual revenue on the table by 2030, which is equivalent to 6 percent of the country’s economy. On the other hand, India is reportedly to be the only economy that will maintain a talent surplus in 2025 and 2030 owing to its huge demography.
Mr Guarino said, “The right talent is the greatest competitive advantage there is for an organization – and that talent is getting scarcer every day. Our study reveals that there already isn’t enough skilled talent to go around and by 2030, organizations and economies could find themselves in the grip of a talent crisis. In the face of such acute talent shortages, workforce planning and a comprehensive understanding of the talent pipeline are critical.”
“The future will be built on the effective partnership between people and technology. The acute demand for workers with the right skills that businesses need, rather than the much-discussed domination of technology in business, could become the defining issue of our age,” he added.