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Davide Gronchi shares an article on optimizing your business during a labor shortage. 

In the last few years we could all observe an increase of labor shortage in traditional sectors of the private business as well in the public administration. In May 2022 only in the US there were 11.3 million open positions vs. 9.3 in April 2021, an increase of 22%.

Many jobs today are not seen as attractive anymore, skilled available resources are getting more demanding to their employer. Several reasons can be identified, just to mention the main ones: A demographic change is happening since the “baby boomer generation” (born around 1955-69) is increasingly retiring

During the COVID-19 pandemic many workers have moved from industries affected by the lock-down to industries with better pay and working conditions

Many, especially in the younger generation are moving from a permanent work condition to independent. Only in the US a recent survey made by McKinsey&Co. shows a remarkable 36% of employed respondents identify as independent workers compared to only 27% in 2016.

All this not only leads to a shortage of skilled workers and unfilled positions in manual artisanal and social professions, but also forces larger companies in all sectors to adapt to the new situation. And this affects all areas of the company.

Current solutions don’t solve yet the problem

In Germany, in addition to promoting (qualified) immigration as a solution to the problem (there is consensus for additional 500,000 qualified people needed every year), it is often increasingly pointed to the possibilities given by digitization and automation.

Both approaches may have their justification, but in our view they are not sufficient and concrete enough. Especially for the administrative areas of a company, we see other possibilities for action.

While measurable productivity gains have already been achieved in the past in the production areas through approaches such as lean and automation, the administrative areas are still rarely the focus of optimization.

This will have to change, as it is questionable whether the labor shortage can be addressed in reasonable time and moreover, new resources can be qualified quickly for those complex administrative positions that require less manual and more intellectual skills.

Key points include:

• Aligning processes
• Concentrating limited human capabilities
• Digitization and automation

Read the full article, Optimization In Times Of Labor Shortage, on GrowingOperations.com.