Lonely Planet: Talent Shortages Loom as More People Remain Single

Screen Shot 2014-12-26 at 3.50.42 PMThe U.S. reached a milestone of sorts in recent months when for the first time since records have been kept, more than half of all people over 16 are single — almost 125 million adults. This trend has been building since the 1970s, but as the number of single people increases, birth rates drop, which means that the labor force starts to shrink.

The trend is the same in much of the developed world.

Every country in Western Europe, plus Russia, Australia, and Japan has an aging and shrinking population. At age 40, almost 40 percent of Italian men are still single and living with their parents.  The situation is the worst in Japan which faces the prospect of losing a third of its population in the next 50 years. Germany’s most recent census showed a decline in the population by 1.5 million, with estimates that the country will lose an additional 19 percent of population by 2060.

Single status for adults used to be an unusual situation up until the 1970s, but is now very much part of the accepted and popular culture. In Japan resorts offer specials for couples where one of them is a virtual companion. A survey in Germany revealed that a quarter of all men think the ideal family size is zero. In Europe a popular crime drama features a suave Italian detective and crime fighter — who lives in Rome with his mother.

The situation isn’t just restricted to developed countries. In China the One-Child policy and a skewed gender ratio means that for millions of men there is almost no possibility of finding a companion or spouse. Consequently the country faces a shrinking population in the years ahead and worsening labor shortages, despite having a population of 1.3 billion.

How each country deals with the challenge is different. Some have aggressive policies to attract talent, such as China’s Thousand Talents Program and the European Union’s Blue Card Program. The Japanese have turned to massive investments in robotics. Robots are being designed for all types of jobs including nursing care, construction, and even jobs that require soft skills like doing market research and serving as museum guides.

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The Talent Deficit

Estimates by the Boston Consulting Group show that by 2030 in many parts of the world there will be “a massive shortfall” of talent:

  • Germany will see a shortage of up to 10 million workers

  • Brazil will have a shortage of up to 40.9 million workers

  • Italy might face a labor deficit of up to 0.9 million

  • Canada will see a deficit of up to 2.3 million

In the U.S. a sluggish economy has meant that we have a surplus of talent, but as the economy picks up steam this too will change. The Conference Board predicts labor shortages in three critical areas:

  • Healthcare. Demands of an aging population and high education requirements mean increasing shortages of occupational and physical therapists, nurses, midwives, dentists, doctors, and surgeons.

  • Skilled labor and trades. A rapidly shrinking supply of young people entering these fields as increasing numbers retire means fewer construction workers, plumbers, carpenters, and truck drivers.

  • STEM jobs. Certain STEM fields — including math, information security, and civil, environmental, biomedical, and agricultural engineering — face significant shortages.

The birth rate has already dropped below replacement level in the U.S., and the growth rate has dropped to 0.71 percent because of slowing immigration. Changes in immigration policy may help increase the availability of talent, but in critical areas — particularly STEM skills — they may have little impact. Increasing numbers of foreign students from countries like China and India now return home as those economies develop and offer more opportunities.

With so many single people benefits programs that tend to favor people with families, and are often part of the pitch to candidates, will have less appeal. Single people face fewer pressures than those with families — such as mortgages and the demands of children. They’re more apt to change jobs in pursuit of more fulfilling work or support for activities they value, such as volunteering. Ever more Americans are also willing to move overseas – almost 4.5 million now live in other countries, and the number is growing by about 5 percent annually. These trends suggest that recruiters won’t be lacking for work, but much will have to change. The world is not running out of people, but finding the right ones for jobs will be harder.

Raghav Singh, director of analytics at Korn Ferry Futurestep, has developed and launched multiple software products and held leadership positions at several major recruiting technology vendors. His career has included work as a consultant on enterprise HR systems and as a recruiting and HRIT leader at several Fortune 500 companies. Opinions expressed here are his own.

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1 Comment on “Lonely Planet: Talent Shortages Loom as More People Remain Single

  1. To me these predictions have the scent of Paul Ehrich’s Population Bomb predictions. According to him, we should all be starving now due to over population. Now the world will end due to falling birth rates. Of course, birth rates are not falling in all countries, nor are trends irreversible, nor is the world static, but one universal truth does hold: most people want to improve their current situation, if possible.

    I seriously doubt the shrinking workforce will be an issue.

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