Skills shortages could impede global growth, says Korn Ferry
Skilled talent shortages will continue to impede global growth and if not addressed, could have a significant impact on major economies by 2030, a study by Korn Ferry has revealed.
Korn Ferry’s Global Talent Crunch study estimates the gap between future talent supply and demand in 20 major economies at three milestones: 2020, 2025 and 2030, and across three sectors: Financial and business services; technology, media and telecommunications (TMT); and manufacturing. The study found that left to run its course, this shortage will create 85.2m unfilled jobs and nearly $8.5 trillion in unrealised revenue in the economies analysed.
Alan Guarino, vice chairman of Korn Ferry CEO and board services, commented, “The world can’t afford to have tens of millions of unfilled jobs and trillions of dollars in unrealized revenue.
“Companies must work to mitigate this potential talent crisis now to protect their future. If nothing is done, this shortage will debilitate the growth of key global markets and sectors.”
The talent shortage crisis could undermine market dominance within sectors:
- Labour shortages in financial and business services are the most severe with a potential deficit of 10.7m workers globally by 2030, which could cause the sector to lose out on annual revenues of $1.3 trillion.
- Technological advancement across all sectors of the economy could be hindered by an acute global labour shortage of 4.3m TMT workers by 2030.
- Manufacturing is facing a talent deficit crisis of 7.9m workers globally by 2030, despite being the only sector with a surplus of highly skilled workers in 2020.
The study also reveals a sizable mismatch between supply of available workers and business demand at country level:
- Developed markets will be hardest hit by imminent talent shortages.
- Australia, France, Germany, Japan and the US face the largest threat, with a combined opportunity cost of $1.876 trillion in annual revenues by 2020.
- The US faces a critical shortage of skilled workers that is set to worsen. It could leave $1.748 trillion of annual revenue on the table by 2030 - equivalent to 6% of the country’s economy.
- India is the only economy in the study maintaining a talent surplus in 2025 and 2030.
Guarino commented, “The right talent is the greatest competitive advantage there is for an organization - and that talent is getting scarcer every day.
“Our study reveals that there already isn’t enough skilled talent to go around and by 2030, organizations and economies could find themselves in the grip of a talent crisis. In the face of such acute talent shortages, workforce planning and a comprehensive understanding of the talent pipeline are critical.”
“The future will be built on the effective partnership between people and technology.
“The acute demand for workers with the right skills that businesses need, rather than the much-discussed domination of technology in business, could become the defining issue of our age.”
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