Based on new research released Wednesday at the 17th Annual HR Technology® Conference and discussed in Thursday’s opening general session, employers and HR leaders seem to have some exciting new arsenal for recreating, reshaping and sustaining their workforces of tomorrow.
The research, to be released in quarterly reports as part of an ongoing ADP Workforce Vitality Report, measures the total real wages paid to the U.S. private-sector workforce based on a number of metrics, including job holders’ wages, job holders’ hours worked, job switchers’ wages and total employment. Although this index, at 110.6 in the third quarter of 2014, is considered the report’s baseline, it did show 0.77 percent growth from the previous quarter.
So job growth, as measured by this new combination of statistics, is, essentially, going up.
What’s especially exciting, though, seems to be the potential future indicators that so much data can provide the employment sector, when you consider it’s depth — based on the wages and employment profiles of ADP’s more than 50 million (one in six) paycheck recipients.
Segments of the U.S. workforce and the growth of wages and hours worked in any industry in any state are now tangible, or at least potentially tangible, showing where growth is strongest and weakest, and perhaps why. Segments “by age, by income, by full-time and part-time status, and even by gender” will also be available, “the latter of which is especially exciting to me,” said Ahu Yildirmaz, head of the ADP Research Institute, at the panel discussion.
Here, for more, is a recent CNBC televised discussion about the new research and another report from MarketWatch.
The session — moderated by David Gergen, senior political analyst at CNN, and including panelists John Boudreau, professor and research director at the University of Southern California’s Marshall School of Business; Steven Cochrane managing director at Moody’s Analytics; Steven Rice, executive vice president of HR for Juniper Networks; and Yildirmaz — took in differing perspectives on just what all this data might mean.
Although the report indicates the South is leading the Northeast in job creation, and low-wage jobs — as in trade, transportation and retail — are leading over higher-income positions, questions still loom over whether this retail boom “is driven by higher wages or higher numbers of jobs” since the data combines all factors into one vitality — or growth — index, said Boudreau.
Moreover, “HR folks today can think of [where to find, place and develop talent] like a chess game, playing it in a more nuanced way,” he said. For instance, the index looks at four types of workers in the labor market: those who stay with the same firm (job holders), those who change jobs (job switchers), those newly hired (entrants) and those who left the firm either voluntarily or involuntarily (leavers).
Where index indicators show higher numbers of “leavers” or “entrants” — be they by industry or region — or higher-level jobs unfilled, “HR folks can be asking, ‘What would it take to make [a particular] pocket of folks who aren’t ready to fill this new talent need more ready for this need as opposed to [having to] seek talent outside the organization?’ ” said Boudreau.
The dynamics of the numeric indications, said Cochrane, actually show “economic growth happening everywhere … we have moved through the downturn, albeit in the context of a slow-growing economy … but the gap is widening between the South and West, and the Northeast and Midwest” … and this could be indicative of growth in general in the South, as in Texas oil and energy, and the “structure of the economy changing.”
Rice left attendees with an important reminder as the sole HR practitioner on the panel; that being that, while the ADP data is a start and a helpful tool, the main goal for all HR leaders using it will be to “build the best workforce to build our companies of the future.”
Looking at organizations, he said, “has completely changed for heads of HR [in terms of] where talent is located, where it’s leaving, cost of labor, etc.” It’s far more of a global challenge now.
“We need to be able to tap into that new talent pool,” said Rice. “There’s a lot of shifting, too, in terms of skill sets and teaching of skill sets to tie into that changing talent pool.”
HR leaders are also grappling with when it makes sense to bring talent together under one roof versus allowing for more virtual project work and collaboration.
“We all need to be asking, ‘What are the areas where we can drive the talent for our ideal workforce?’ ” said Rice. “This kind of data can help.”