US-based global organisational consulting firm Korn Ferry has said India would have a talent surplus of around 245.3 million workers by 2030 at a time when the Asia Pacific (APAC) region would face a talent deficit of 47 million workers. The world's sixth largest economy, India, is the only place in the APAC region that will have a talent surplus by 2030, says the Korn Ferry study named as 'Global Talent Crunch'.
The study says the skilled talent shortage will continue to impede growth and, if not addressed, could have a significant impact on major APAC economies by 2030. "Companies must work to mitigate this potential talent crisis to protect future," said Michael Distefano, Chief Operating Officer, Korn Ferry Asia Pacific. He added that if left to run its course, this shortage will severely impact the growth of markets across APAC. The region is expected to have an imminent talent deficit of over 12.3 million workers by 2020, rising to a shortage of 47 million workers by 2030. The shortage could lead to $4.238 trillion in unrealised annual revenue loss if the problem is not addressed, the report says.
The study estimates the gap between future talent supply and demand in 20 major economies in 2020, 2025 and 2030, and across three sectors: financial and business services; technology, media and telecommunications (TMT); and manufacturing.
The study says the world can expect a talent deficit of 85.2 million workers across the economies analysed - greater than the current population of Germany.
Globally, the study reveals the United States, Japan, France, Germany and Australia would face the largest threat in the near term, with a combined opportunity cost of $1.876 trillion by 2020. Labour shortages in global financial and business services are the most acute, with a potential deficit of 10.7 million workers globally by 2030.
Bhavna Sud, Client Partner, Korn Ferry India, said: "The talent crunch will severely impact the growth of key markets and sectors across the region. India however, has the unique distinction of having a talent surplus right now and will continue to do so in 2030."
Industries where the talent surplus will be the most visible in India include the financial services with a surplus of 1.1 million, TMT at 1.3 million and manufacturing at 2.44 million of extra manpower in the next 12 years.
"However, it's no secret that while India has a surplus of talent, we must deal with the twin challenges of employability and job creation. The government as well as industry have made significant efforts to address both issues through programmes like 'Skill India', but we will have to do more to create a competitive advantage of the surplus manpower we have. If left unchecked, the talent surplus will add to our woes of jobless growth and unemployment," said Sud.
How to tackle talent crunch challenge?
- Companies need to re-think their hiring and talent management processes.
- Hire for fit and culture rather than skills because skills come with a shelf-life.
- Hire people high on agility and make continuous learning a part of your life.
- Retain your best; tap into new and different sources of talent.
- Make it easy for women to re-enter the workforce and double your talent supply.