December 24, 2014
As the digital age takes ever deeper root in our lives, the interconnectedness that it brings is having a profound effect on careers. The digital age is closing the window on some opportunities while opening unexpected windows of opportunities elsewhere for those perceptive enough to recognize them. Anyone interested in starting their working life, continuing a career, or repurposing himself or herself to start a new job, will want to keep up on the current activity in the workplace. Here is a summary of many of these key trends.
Freelancing Becoming Normalized
Until fairly recently, you would only rarely encounter someone who worked at home as a freelancer, contractor or consultant. That is changing in a hurry. There are already 17 million freelancers in America, and it is now estimated that this number will grow over the next six years to the point where they will outnumber full-time employees. In the future, people will raise their eyebrows upon encountering someone who works in an office, rather than in what will then be the more traditional home-based setting.
Employers are warming up to the use of freelancers because of the financial savings they secure by avoiding any need to pay benefits, including the famous Affordable Care Act penalties. Companies also like having the option of hiring experts for a limited time and for a specified project. The result is driving professionals as well as workers in more traditional contract positions back to their homes to make money.
As touched on above, the implementation of the Affordable Care Act is having a measurable effect on employment patterns and practices. Employers who have over 50 employees are subject to the provisions of the law, and they are delaying hiring decisions as a result. The law is also expected to accelerate a shift to contingent workers and workers employed for less than thirty hours per week.
Slow Economy Slowing Careers
The multi-year lagging economy has by now also had a harmful effect on career prospects across the board. While corporate stock prices are up, some of the related gains in productivity have been the result of tech-driven efficiencies that have reduced payrolls. The hardest hit are Millennials, who sport the highest unemployment rate of any age demographic. And for those Millennials who do find work, it is taking them four years longer, on average, to achieve the same income, inflation-adjusted, as it took their parents back in 1980.
While a college education used to ensure employment and the ability to move up in one’s career, today’s bachelors degree is serving only the purpose of yesterday’s high school diploma, assuring employers that a candidate is literate and reliable, but often not offering proof of expertise in a particular field.
Gender Gap Closing
On the bright side, the current trends are successfully closing the famed gender gap in employment income. After controlling for other relevant factors, including the differential arising from the decision of many women to interrupt their careers in order to start a family, there is now only a 2 to 3% difference between men and women when it comes to pay across all age demographics.
Moreover, the gap is expected to shrink as Millennials continue to increase as a percentage of the workforce. This is because many of the trends operating within that generation strongly favor gender equity. Among these are the increase in the number of women receiving higher education (women now outnumber men in undergraduate enrollment), and the fact that an increasing number of Millennial men are deciding not to participate in the workforce.
Out With The Old, In With The New
The baby boomer generation has passed through American life like a large meal through a python, and this demographic is now beginning to retire. Nearly a fifth of these workers will exit the workforce within five years, and of course it is the Millennials who will be replacing them.
This will bring major changes to the national workplace, as companies scramble to adjust their workplace needs to the available talent pool, which will need to scramble as well to acquire the skills that are needed. The opportunity, and the need, for inter-generational mentorship will be great as the baton is passed to a new generation of workers.
Filters Are Not Just For Coffee Anymore
With the supply of labor outpacing demand, hiring managers are facing a blizzard or resumes in answer to their job listings. Their response has been to develop software screens and filters that analyze the resumes before they do, and of course the filters screen out many of them. A human resources filter can, for example, remove all resumes that contain no college graduation information. This process can become quite granular, with the result than many applicants must struggle just to get their resumes in front of a pair of human eyes.
Social networks are also being used by employers to recruit employees. Hiring managers now routinely examine candidates’ LinkedIn profiles, and a Google search of the applicant’s name is not out of the question either. While this may seem like an added obstacle, applicants are able to turn this to their advantage by consciously cultivating an online presence that employers will find attractive.
Bad Habits Make for Expensive Employees
Employers have done the numbers on employee health, and have come to recognize that their employees who pursue unhealthy habits are costing them a bundle. Moreover, the Affordable Care Act allows employers to use financial rewards and penalties to encourage healthier behaviors among their employees. The trend that will emerge from this is already clear. Like it or not, employers will increasingly use both carrots and sticks to secure better personal behaviors from their workers.
The Only Constant Is Change
The trends outlined above offer some insight into the extraordinary period of change that the world of work in undergoing. For those who are sufficiently nimble, and sufficiently informed, these trends will offer more opportunity than peril. As in other eras that saw their own share of unexpected alterations in the employment landscape, the only constant is change.