There is a crisis brewing on the talent front.
A recent study conducted by Korn Ferry found that there is a growing shortage of highly skilled workers on a global level. This dearth will ultimately cause some world-leading economies, including the United States, China and Germany, to experience rapidly escalating employee costs.
The projected increase in compensation costs is staggering. By 2030, it’s estimated that organizations will add more than $2.5 trillion to their annual cost of labor.
But even more shocking is that these economies will fail to generate more than $8.5 trillion in annual revenue as a result of the talent scarcity.
A little closer to home, we’re already starting to see repercussions of the workforce shortage. Compensation costs are rising rapidly for both highly skilled labor and the top percentile of talent, and the pace is unlikely to decelerate even as the economy begins to slow down.
A byproduct of this trend is a more defensive approach by employers who are making sure they take care of their top talent in ways that significantly impact their employees, both in their wallets and in terms of career development.