Leaders can take advantage of a great opportunity to leverage talent and drive growth in a tight job market, if they know where to look.
This article originally appeared in TechPoint Index.
We’ve all seen the headlines—this year, the U.S. Department of Labor reported unemployment was at a nearly 50-year low, hovering around 4 percent. However, positive news for the overall health of the national economy isn’t all bright for employers. Continued economic growth leads to increased demand for talent, and creates more competition in an already tight talent market. On average, it now takes 42 days to fill an open position, and 52 percent of recruiters reported scarcity or lack of qualified applicants for their open positions.
With all the jobs either coming or already available, leaders might assume employees are in the driver’s seat when it comes to rising through the ranks at their own organization, when in fact, the opposite seems to be true. Only 33 percent of Millennials feel they get the chance to do what they do best at work, and 37 percent of workers said their current job does not fully utilize their skills or provide enough challenge. Despite more open roles, employees are still more likely to look outside their organization for growth than they are to try to advance within their own organization.
In a tightening market, it’s no longer feasible for employers to continue relying on new headcount to solve productivity issues. It’s time to abandon the idea that leaders can hire their way out of slow growth and unimpressive results. Instead, businesses need to find better ways to leverage and develop existing talent to find the momentum they’re looking for.
The Cost of Underutilized Employees
Leaders are rightfully worried about what the war for talent means for their business, but few are taking steps to avoid talent shortages. Research suggests that 72 percent of CEOs are concerned about the availability of key skills on their teams, yet few organizations have reliable systems in place to capture, track, and nurture the talent they already have. The best information on employee skills and availability often lives in an aging resume database, outdated intranet, or even on external employee LinkedIn profiles. When the majority of employers have little to no access into the skills, experience, and availability of their workforce, it’s no wonder that so many leaders turn to hiring to solve their perceived talent issues.
Hiring new talent to solve existing challenges may have a more negative impact than employers realize. Not only does it suggest current employees may not have interest take on more expansive roles, it also assumes they don’t have the skills or experience to get the job done. “Most companies are adept at bringing in smart, talented people,” writes Liz Wiseman, executive advisor and author of Multipliers: How the Best Leaders Make Everyone Smarter. “Few companies put as much discipline into understanding how fully they are using the talent they’ve acquired.”
Underutilized talent does not just means jobs go unfilled and projects are put on hold. It means the whole organization suffers from lower productivity than it would if employees were aligned with the right opportunities to succeed. Organizations with less productive teams see up to 50 percent lower profit margins than organizations who are optimizing their current talent to drive productivity. Leaders who fail to find a way to boost productivity for existing employees face being left behind as they try to hire their way out of slow growth, when they could be re-focusing their efforts on boosting the impacts of the people they already have.
Fixing Your Talent Shortage, Without Adding Headcount
Employees who utilize their strengths and stretch their abilities on the job are invaluable to their organizations. For executives, the challenge comes in aligning talent with the opportunities that will challenge and inspire them. By understanding employees’ strengths, experience, interests, and career objectives, leaders can assign existing team members to new projects and roles that allow them to stretch their skills and dive into the type of work that inspires them to achieve more. After all, one inspired employee can produce as much as 2.25 average employees, and employees who get to use their strengths are more profitable for their organization, with less stress.
The best leaders know that strong, optimized teams drive growth, especially in times when new talent is hard to come by. Instead of relying on the next big star to fix your problems, it’s time to dig into the data to maximize the contributions of your people hiding in plain sight. Learn how Structural is putting people data to work by simplifying access to critical insights to accelerate projects, build stronger teams, and drive growth.