CHAPTER NINETEEN
Jobs and People
The Growing Mismatch
IT IS BECOMING FASHIONABLE TO RENAME the personnel department “the department of human resources.” But few employers, indeed, few human resources managers themselves, yet realize that more is needed than a better personnel department. We face a growing mismatch between jobs and available labor supply.
Both are changing, but in different, often opposite, directions. As a result, the job openings increasingly do not fit the available people. In turn, qualifications, expectations, and values of people available for employment are changing to the point where they no longer fit the jobs offered.
This applies to the job most people still think of when they speak of “labor,” the blue-collar job in manufacturing. Even outside the “rust bowl,” blue-collar unemployment is still high enough to hold wages down. Yet some of the most desirable and best-paid blue-collar jobs are increasingly hard to fill. What formerly called for “skilled labor” now increasingly demands a technologist, that is, someone who has a modicum of theoretical knowledge, in, for example, installing information systems or in programming robots and automated materials-moving equipment. It is in such work that manufacturing offers the fastest-growing job opportunities. But we do not even know as yet whether old-line blue-collar workers can be retrained in large numbers for such jobs. In the hospital, the one major employment area with a need to fill such jobs in the past, upgrading traditional blue-collar labor has not worked. The “paramedics” represent a group with different backgrounds, training, expectations, and qualifications. And the technologist in the factory actually needs greater ability to acquire additional knowledge—and thus a firmer theoretical base—than did the paramedics with their narrow specializations.
Changes in jobs and their content are also creating mismatches in management. Technology is one factor. We know how to train people to do technology such as engineering or chemistry. But we do not know how to endow managers with technological literacy, that is, with an understanding of technology and its dynamics, the opportunities it offers, and its impact on product and process, markets, organization structures, and people. Yet technological literacy is increasingly a major requirement for managers, especially on the lower and middle levels.
But not only individual jobs are being changed; organization structures are changed as much. Technology is again a factor. As more information becomes available, fewer levels of management but more specialists of all kinds are needed. Changes in the economic and social environment are pushing businesses in the same direction. Twenty years ago, high-level specialists were, on the whole, confined to research and to data processing. Today, even a medium-size company may well have an environmental specialist, one assistant treasurer who does nothing but manage cash and liquidity and tries to protect the company against foreign-exchange losses, and another one who watches over costly benefits programs.
Our management trainees, however, are unprepared for careers as specialists. Their aspirations and expectations point them toward managerial jobs. And in business, the values, career opportunities, and rewards still assume an organization structure in which a managerial rather than a professional appointment constitutes recognition, advancement, and reward. To be sure, thirty years ago, a few companies, notably GE, pioneered “parallel ladders” of recognition and promotion for managers and individual professional contributors. But save in strictly scientific work, this has not really worked so far.
The assistant treasurers who handle the company’s foreign-exchange exposure or its benefit plans see their advancement in being promoted out of the specialist’s job and into “general management,” yet there are fewer and fewer promotional opportunities in general management.
In the clerical ranks similar forces have the same effects. “Electronic mail,” for instance, makes most of the traditional secretary’s skills obsolete. Instead, she is likely to find herself expected to define the one part of her boss’s work that henceforth will be her own direct responsibility. And even the secretary who sees in this a promotion is unlikely to be prepared for the change.
Shifts in population structure and age structure may have an even greater impact on the mismatch between jobs and labor supply, at least a more visible one. The labor-force participation of married women under age fifty is now just as high as that of men. It is therefore unlikely to rise any further. But a very large number of women in the labor force—the bulk of those who entered since 1970 when the inrush of women began—are now reaching their mid-thirties. They are approaching the age at which they must decide whether to have a second child. And most, save only the minuscule proportion in executive ranks, want both a career and a family.
Most of the married women stay in the labor force after their first child. Few, it seems, drop out entirely even after the second one. But a large proportion switch to part-time work at least until the second child enters third grade. Some employers have organized for this and have created permanent part-time jobs staffed by women employees. The great majority have not. And even those who offer part-time job opportunities have, as a rule, not thought through what these permanent part-time employees require by way of benefits, opportunities, pensions, and so on. Where rights for women were the great “cause” of the late 1970s, rights for part-time workers who are women may become the cause of the late 1980s and early 1990s.
Another major factor is the moving of the baby-boom babies into middle age. Many companies are speeding up the early retirement of the over-fifties to make room for large masses of baby-boomers—the oldest of whom are now almost forty—who demand promotions into key jobs. But the oldest of the “baby-bust” babies are now themselves twenty-five years old, and entering their first managerial jobs. And they expect the same opportunities and rapid advancement their only slightly older predecessors have had. Yet these expectations are unrealistic.
When the baby-boomers entered the work force there was a vacuum in management positions. But the newcomers now will find that the pipelines are full. Most of the baby-boomers have gone as far as they will go in management and will stay in their present jobs another thirty years or so. There is thus a total mismatch between reality and the perfectly normal expectations of the young people now entering the work force. To bridge it we will not only have to change expectations; we will have to redesign managerial and professional jobs so that even able people will still be challenged by the job after five or more years in it. Increasingly, in other words, we will have to heap responsibility on people in junior positions. And, above all, we will have to find rewards and recognition other than promotion—more money, bonuses, extra vacations, perhaps a “presidential citation,” and so on. In the meantime, however, an entire generation has grown up for whom promotion is the only “real” satisfaction, and failure to get one every year or two is equivalent to being a “loser.”
And there is the emergence of entrepreneurship, especially in existing businesses. Existing businesses increasingly will have to learn to be innovative and to create entrepreneurship within the going concern. We know how to do this; there are any number of examples around. And people on all levels within the company and outside of it are ready to become innovators and entrepreneurs. Yet, with the exception of a fairly small number of entrepreneurial companies—Johnson & Johnson, Procter & Gamble, 3M in this country, Marks & Spencer in Britain, and so on—existing businesses, small ones even more so than large ones, know only managerial jobs, pay only for managerial performance, have only a managerial structure and managerial tools and measurements.
To attract and hold entrepreneurial people and to promote innovation and entrepreneurship, companies will have to create new structures with new relationships and new policies and supplement managerial compensation, benefits, and rewards with those appropriate to the very different realities of entrepreneurship.
To overcome the growing mismatch between jobs and labor supply, employers—especially large ones—will first have to think through and project their job needs a few years out. So far, planning mostly means anticipating the markets for products and services a few years out, analyzing technology, and projecting both on money needs. Increasingly, planning will have to project people needs as well and will, in turn, project jobs and demographic trends on products and services, technology, and money requirements. Increasingly planning will have to ask: Do these goals of ours take advantage of trends in labor supply and in the expectations, aspirations, qualifications, and values of people? Or do they run counter to them? The most successful planning in the future may well start out with trends and developments in the supply of people rather than with financial goals or market projections.
Also, companies will have to both step up and considerably change their training. American business is already the country’s largest educator. But most companies have “training programs” rather than a “training policy.” Few focus their training on the company’s needs five years out or on their employees’ aspirations. Fewer still have any idea what they are getting for all the money and effort they spend on training, let alone what they should be getting. Yet training may already cost as much as health care for employees—perhaps more.
Finally, employers increasingly will have to change what they mean by “labor market.” Increasingly it will be the job seeker who is the “customer,” with job opportunities and job characteristics having to satisfy the job seeker. Traditionally employers have seen the labor market as homogeneous, divided only by very broad lines: age and sex, for example, or manual workers, clerical workers, and managerial and professional workers. But increasingly the available work force is segmenting into a fairly large number of different markets, with considerable freedom for the individual to switch from one to another. Increasingly, therefore, employers will have to learn that jobs are products that have to be designed for specific buyers and both marketed and sold to them.
(1985)