United States Must Transcend Political Gridlock to Address America’s Unemployment Problem: Deloitte Report
College skills outdated long before student loans paid off
SAN JOSE, Sept. 10, 2012 —Job creation in the United States is hampered by supply and demand, but not in a traditional sense, according to new research from Deloitte. Specifically, the demand for highly skilled and adaptable workers is accelerating, but the skill set of the country’s available talent is either outdated or out of stock, Deloitte reports.
Moreover, the report suggests that despite the warning signs of record high unemployment, industry market contraction and pressure from new global markets, the United States lacks the comprehensive policies needed to develop the most valued American commodity of all: good jobs. This challenge will not be resolved on its own without a significant reassessment of a broad range of public policies.
“In order to maintain our global competitiveness, there is an urgent need to reassess a broad range of public policies through the talent lens rather than only narrowly focusing on education as the key to promote a highly skilled, more adaptable and a more competitive American workforce,” says John Hagel, director, Deloitte Consulting LLP and co-chairman, Deloitte Center for the Edge, which conducts original research and develops substantive points of view for new corporate growth.
Deloitte’s “Brawn from brains: Talent, policy and the future of American competitiveness” research report examines policy reframing that needs to be undertaken by the United States to remain competitive as the talent landscape changes. The report advises the United States restructure six key interrelated policy areas to ensure that the country remains competitive in developing and retaining talent, these include employment regulation, immigration, foreign investment, unemployment insurance, intellectual property and education.
A changed talent landscape: The report reveals that the market for specialized skills is on the rise and the rapid evolution of technology has pushed the demand for technology savvy workers past the supply. The knowledge economy is also creating a constant series of niche markets and ushering in an age of hyperspecialization. As workers develop specialized skill sets to accommodate this trend, employment opportunities continue to evolve which require workers to retrain and develop transferable skills.
Desirable skills shelf life shrinking: Soon, the skills that graduates acquire after four years of college will have an expected shelf life of only five years – meaning skill sets will become outdated long before student loans are paid off.
Changing talent supply: We are no longer developing the workforce with the skills and training needed to fill available opportunities, according to the report. Additionally, the workforce is aging and maintaining high-end jobs well into the retirement years. This could further impair economic performance as this demographic of employees becomes less adaptable, mobile and innovative.
In addressing the changing nature of the new talent landscape, the Deloitte report proposes recommendations based around one simple question that could be, but rarely is, applied in virtually every policy domain: Which policy options will accelerate talent development and which policy options will impede talent development? By explicitly focusing on an opportunity that has the potential to create value for everyone, this reframing might also help to break the deadlock that has increasingly hampered national policymaking.
Reframing immigration: Our nation must cope with greatly increased competition from abroad, with emerging markets such as Brazil, India and China becoming key players in the global war for talent. More developed nations such as Australia and Canada are stepping up their game and recruiting skilled talent through more competitive immigration policies. U.S. firms can no longer attract the world’s best workers easily. Adopting a more talent-friendly approach to immigration would make it easier for talented individuals to stay in the U.S. while also keeping top foreign students at U.S. universities.
Occupation and employment regulation: We need policy changes to encourage employment regulations that offer protection to consumers without stifling entrepreneurship. Occupational licenses serve as a means to protect consumers in the U.S., but also act as barriers to entry for many professions due to the amount of regulations they face. The report suggests that policy makers reassess regulatory barriers related to such licenses. This course of action could revitalize communities.
Further, the report also asks for adjustment in foreign direct investment to help create jobs and opportunities in the U.S. and ensure foreign firms commit to the community by investing in the surrounding ecosystem.
Lifelong learning required: Current policy discussions continue to focus on how the U.S. can improve the performance and quality of K-12 and higher education. These discussions must also zero in on strategies to meet ever-changing skills needs and encourage lifelong learning. Reforms addressing K-12 should focus on expanding technical and vocational training and apprenticeships as an alternative pathway to highly specialized skills. White and blue-collar workers must be able to continually learn and adopt new skill sets to keep up with job requirements.
“We have reached an inflection point. Individuals, firms and policy makers can no longer remain complacent about developing the U.S. talent base,” said William Eggers, director, Deloitte Research, Deloitte Services L.P., who leads research initiatives for Deloitte’s public sector practice. “We must refocus, reimagine and reshape our domestic policies in six key interrelated areas through the lens of talent.”
“Brawn from brains: Talent, policy and the future of American competitiveness,” is the fourth in a series of Deloitte studies to be published before the 2012 election. Among topics explored in the series are health care reform, the role of manufacturing in U.S. competitiveness, energy independence and government transformation. Visit www.deloitte.com/us/leadstrong for research-based, non-partisan insights for public and private sector leaders on these and related issues. To download a copy of the full report, go to www.deloitte.com/us/talentopportunity.
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