The hot job market is almost becoming a crisis – Josh Bersin

unbelievable. After four months of worrying about a recession and a steady increase in interest rates, today the BLS reported that 528,000 jobs were created and the unemployment rate dropped to 3.5%. This is the lowest level since 1969, when I was in middle school.

At the same time more and more jobs are created, GDP itself is slowing down. What does this mean? Well, economists keep getting it wrong – it’s actually quite simple. The economy is shifting from goods to services, with an increasing need for people.

As I discuss in the video below, we have automated many things in the business world, but technology never stops. The idea that a computer or artificial intelligence system will “replace people” is ridiculous. Once you create it, something else comes along, so if you don’t have people monitoring it, developing it, and adapting to it, the technology simply becomes less valuable.

This is why companies like Google, Apple, Amazon and Microsoft keep hiring. Technology itself is a people-centric business, and now that we can work from anywhere, the talent model for every company is global.

Why do I say this is a crisis? Because, quite simply, we can’t “manufacture more people” in a jiffy. We can solve the global supply chain problem by building a factory, purchasing a ship, or expanding a distribution center. People don’t work that way. We need to educate and train them and train them to perform on the job. And as all the data now shows, when people “push” hard, they just quit, quit, or change jobs.

I won’t repeat all the research we’ve discussed, but several studies now prove that nearly a third of the workforce will change employers this year and more than 40% of these activists will change the industry. So, regardless of these layoffs, you see in the overly bloated tech companies, nearly every company is struggling to hire, retain and grow their employees.

There are a lot of reasons behind this: a low fertility rate, early retirement for baby boomers, and the frustratingly difficult work experience many people have in retail, transportation, hospitality, and other industries. And of course, people feel underpaid when inflation rises, and most employees feel overworked. (81% feel exhausted).

My point is not to repeat what you probably already know, but to tell you that this is a problem as well do not go away. This shift to service-focused industries is a major and long-term impact, and it drives the message that every company, regardless of industry or size, is now in the realm of people and talent.

Next week we’ll be taking a great new look at the corporate training industry and you’ll see how affected it is by this issue, and in September we launched our Global Workforce Intelligence research and you’ll see all this data in detail.

However, the big message for executives and HR staff is that you should think about your company differently. You can no longer just “recruit” your way out of this problem. We need what we call “systemic HR” strategies and fully integrated HR operating models that combine the four elements: hiring, retaining, reskilling, and redesigning, all in one integrated way.

We’ll explain that more in the coming months, but now it’s clear from all of our research that you have to do these things in a new and innovative way. This is the only way to deal with this existential shortage of labor.

The only real solution, regardless of the direction of the economy, is to treat people as an asset. As I describe it in my book, it’s time to “make your company irresistible,” and all that that means.

Every company we talk to is now working on figuring out how to do that, and ultimately this is the solution to the crisis. Stay tuned for more.

Additional Resources

Mental health in the workplace is now a business strategy

Irresistible Design: The Successful Strategy for Today

Be careful with layoffs

How job design and job design have pushed companies back

Unleashing Human Potential: The True Secret to Business Success

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