Article contributed by Manpower Group Solutions TAPFIN, September 2011
According to a recent study by the Georgetown University Center of Education and the Workforce, by 2018, 63 percent of all jobs will require at least some level of postsecondary education. The study also revealed that the US will need 22 million new workers with this level of education to sustain the current economic growth.
The contingent labor market consisted of some $1.4 trillion in worker salary in 2009 on a global level, according to Staffing Industry Analysts. Companies today are being asked to deploy their workforces globally to ensure acquisition of the best talent. Yet as companies look abroad, individual labor laws, demographic challenges by country, and other cultural nuances create complexity for companies looking to expand overseas. Consider two markets in the Asia Pacific region - Japan and India.
India’s total workforce is approximately 476 million people. Almost half a million technology students graduate post secondary schools, and 70 percent of the population is under the age of 35. Additionally, India has some 45 pieces of recent legislation that impact how a company would go about hiring a contract worker, making contingent workforce programs a more complex endeavor despite an abundance of available labor.
On the contrary, Japan’s total workforce is less than 70 million, the majority of workers are older, and it has been impacted by recent natural disasters that have reduced the attractiveness of local labor markets. The government has restrictions related to foreign workers augmenting the natural workforce, and a lack of younger workers has resulted in a larger gap in available skilled trades. If you’re considering expansion into either of these markets, understanding these challenges is critical to maximizing your investment.
Similar challenges exist in Europe. Switzerland and Hungary are both relatively small countries (just over four million workers in each country) with low unemployment rates. Yet Switzerland’s unemployment benefits can be very challenging to overcome. On average, lower paid employees actually stand to lose money by going back to work versus staying on unemployment. In Hungary, hiring seasonal workers now requires additional fees from the government, and these employees are also tax exempted.
So where do organizations even turn to begin to understand these challenges?
The answer is very complex. A one-size-fits-all approach does not exist. To be successful, organizations must have a strong understanding of the different laws, cultural nuances and demographic shifts in each market to succeed. Whether this occurs internally based off your geographical footprint or through a trusted partner in the region is critical. To maximize your workforce, you must have a strategy in place with a global perspective that offers consistency across borders.
The success of your workforce today, and tomorrow – hinges upon it.