Industry News
Economic Trends May Change the Way We Do Business
While it is not the end of the calendar year, it is the end of the fiscal year and
as good a time as any to identify some economic trends that may occur over the next
12 months.
The following is based on projections from the Chicago-based outplacement firm Challenger,
Gray & Christmas, Inc. While some of these ideas may be more plausible than others,
all of them are food for thought.
The End of Business Travel
With airfares continuing to increase, along with pressure to become more environmentally
responsible, American corporations may eventually eliminate the need for business
travel in favor of teleconferencing.
Some companies have already instituted teleconferencing with great success. Since
implementing videoconferencing, telecommunications firm Vodaphone estimates that
it has eliminated more than 13,500 flights per year and reduced its carbon footprint
by over 5,000 metric tons.
A New Way to Recruit Employees
Over the next ten years, recruiters will increasingly shift their recruiting efforts
away from traditional print ads and online job boards to the rapidly expanding world
of social networking sites. The shift may already be occurring. The executive director
of the National Association of Colleges and Employers noted in a recent interview
that while most employers once viewed social networking sites solely as a way to
"check out" potential hires, more than half now use these sites to proactively identify,
reach out to, and network with candidates.
A survey by an Australian law firm found that nearly half of regular social networking
users would refuse a job if these sites were banned by a potential employer.
Employees Assuming More Health Insurance Costs
The percentage of business with fewer than 200 employees offering health insurance
has been falling steadily and the number of larger firms shifting much of the cost
burden to employees has been increasing. For example, in-network PPO deductibles
have increased from $689 in 2001 to $1,134 in 2007.
Add to this, the fact that more Americans are changing employers every year or two,
or are employed as contract workers, and it is easy to see a trend forming away
from employer-financed health insurance. The inefficiency of handling the paperwork
alone is enough to drive companies to seek alternatives.
The Four-Day Work Week
Rising gas prices and the availability of portable technology will make the four-day
work week a practical option for employers. Workers seeking greater balance between
work and home life will also drive this option.
A new Challenger survey found that 23 percent of companies are offering a condensed
workweek, typically consisting of four 10-hour days. In some cases, companies are
finding that workers armed with the latest productivity-enhancing tools are able
to get their work done in a four-day, 32-hour workweek.
Corporate Degree Programs
More and more jobs will require advanced technology know-how, creative problem-solving
abilities, and superior communication skills. However, the high level of education
needed for these jobs will be financially out of reach for many Americans.
In response to this problem, large employers will create their own degree programs
to develop future and potential employees. Many companies have already seen the
benefits of tuition assistance, now they will attempt to customize entire educational
programs around their companies and cultures.
In theory, this will eliminate the need for on-the-job training and save both the
company and the worker thousands of dollars. Future students will hold degrees in
things like web design from Google University or Microsoft College.
Employers such as IBM have already instituted courses specifically tailored to meet
the demands of the company. This should become more widespread.
No More Headquarters
Within 20 years, the need for corporate headquarters will be nearly extinct. In
an effort to cut costs and become more eco-friendly, employers will adopt a work
wherever you want, whenever you want policy.
Some companies have already headed in this direction. Best Buy, Sun Microsystems
and At&T are on the leading edge of a seemingly radical management approach that
judges employees on the quality and quantity of output rather than on their physical
presence in the office. In other words, if you get a quality report done on time,
it does not matter where or when you wrote it.
This approach has financial benefits associated with it. Sun Microsystems, for example,
estimates that it saved $400 million in real estate costs over a six-year period
by freeing employees from the traditional confines of the corporate office.
Free Agents Will Take Over
Free agents are the fastest growing worker segment in the United States and their
numbers are expected to grow over the next decade.
According to market research firm EPIC-MRA, free agents should represent 40 percent
of the workforce by 2012. This trend will benefit both companies and workers because
it will provide greater flexibility to workers and reduced benefits costs to employers.
Workers will also benefit by selling their expertise to the highest bidder.
Source: Challenger, Gray & Christmas, Inc.
www.challengergray.com
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