Two important statistics begin this discussion…
- Starting in 2016, more people will be leaving the workforce than entering it
- By 2020, 46% of all U.S. workers are predicted to be Gen Y
Thus the foundation for the war for talent, or what my friends at large companies are calling, ‘the war on talent’, as in competitors targeting and soliciting our top talent.
Not since World War II, when soldiers were leaving the workforce to fight, have we experienced a shrinking workforce. Moreover, with millennials soon representing 46% of the talent, this war for talent must be fought strategically, with different methods and different incentives than before.
Continuing the theme of execution as the driver of success and hiring the right people being a key part of execution, successful leaders are taking a two-pronged approach, focused on retention of older workers AND attraction, retention and incentives for younger workers.
In short, the war for talent is a competitive war with the same goal as winning business, i.e. getting your unfair share of the market.
We have begun conversations in all my Vistage groups on this topic. Here are some creative actions I am hearing; please share yours.
- Apprenticeship – once reserved for the trades, today Vistage members are starting to create positions for apprentices to learn the expertise of seasoned executives before they retire.
- Project Time – Google began this practice as part of their innovation culture; other companies are adopting a variation to give millennials the opportunity to make an impact early in their careers.
- Social Impact – Gone are the days when matching contributions are enough; companies who make a social impact attract Gen Y workers.
- Long Term Incentives – As young executives start families, companies that offer “golden handcuffs” retain their executives through the business cycles. While common in the large corporate world, these incentives are beginning to show up in middle market companies. Offerings include deferred compensation, stock options and stock grants.