Impending baby boomer retirements, a widening skills gap driven by declining educational standards, and outdated and ineffective approaches to talent management are combining forces to produce a "perfect storm" that threatens the global business economy, according to new research conducted by Deloitte Consulting.
More than 70 percent of the 123 human resources executives polled say incoming workers with inadequate skills pose the greatest threat to business performance over the next three years, followed by baby boomer retirement (61 percent) and the inability to retain key talent (55 percent).
"The overwhelming accumulation of data...points to an inescapable conclusion: the widening skills gap, particularly among the categories of workers who disproportionately drive companies' growth and performance, is a global phenomenon that will create unprecedented challenges for businesses," said Ainar Aijala, vice-chairman, Deloitte Consulting.
In only three years, the first wave of baby boomers will turn 62, the average retirement age in North America, Europe and Asia. According to the study, one-third of US companies expect to lose 11 percent or more of their current workforce to retirements by 2008.
Unfortunately, few organizations have talent management processes in place to address the impending workforce shifts that will negatively impact critical talent segments. Even more troubling, according to Deloitte, is that more than a quarter of respondents say defining critical skills as a workforce tool is "unimportant."
Talent-savvy organizations build strategies around what matters most to their critical talent-their personal growth or development, their need to be deployed in positions and assignments that engage their interests and curiosities, and their connection to others in ways that drive performance for the company as a whole, says the study.
For more information visit www.deloitte.com/us/talentpov.