Talent Shortage? Invest in People
- September 1, 2011
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In a recent Austin Technology Council (ATC) CEO Summit, talent shortage were a hot topic. Which sounds crazy when the unemployment rate is north of 8% in Austin, and in Texas. AustinStartup’s George Dearing did a good job addressing a few of the key issues. It’s a really good read.
- 77% of respondents agree that there will be a shortage of technically skilled talent in the future.
- 71% of respondents agree that there is a shortage of technically skilled talent at the present time in Austin.
- More than half of respondents believe that talent issues have limited their organization’s productivity and efficiency.
Future Talent Shortage: I think the overall concern for the future is valid – but overstated. Technology and productivity advancements often have surprisingly dislocating affects on employment. In the 1990’s, VLSI and CAD tools got to the point where 4 Electrical Engineers could do the work that had required 100 engineers just a couple years previously. I watched my fellow class of ’94 graduates in EE go into software companies instead of working for Intel and the like – there just weren’t the number of new jobs in electrical engineering and chip design that there had been in previous years. In Austin I’ve followed the chip business with some interest – and I would venture to say that the number of chip designers employed here probably declined into the early 2000’s… until the market changed. Now there are a lot of different chip applications – mobile devices and analog applications have created opportunities for a lot more applications – and for more engineers. And, with the tools at our disposal today, it may make economic sense to tweak chip designs for much smaller volumes than in 1995.
What’s my point? Technology employment is volatile. That results in under-representation in STEM (Science Technology Engineering Math) majors, and it results in people with little STEM education joining STEM-related fields in boom times… and it results in people with STEM backgrounds exiting these fields when the boom eventually turns to bust.
When I was entering college I heard and read the same concerns about there not being enough engineers. Somehow we made it to 2011 anyway. All I know is, STEM majors are going to be good choices for college students for many years to come.
Shortage of Talent in Austin Right Now: I don’t see it. I was just talking with someone today at a local software company who commented how hard it was to find the right people in Austin. I expressed sympathy – after all, BPM is a bit of a niche business, so I can relate in that not everyone is an expert in BPM software. But his complaint was that people don’t spend enough time retraining themselves to be prepared for the technology shifts – learning a new platform or language. He has a point – if you’re in high tech and you’re not willing to invest in your own skills you’re making a mistake. But it seemed clear his expectation was that his company shouldn’t have to make an investment in someone ramping up.
But, on the other hand. This reminds me a bit of companies who hire interns but don’t expect to teach the intern anything. If you’re hiring high tech workers, you have to be willing to mix it up. Sure, hire a few people with expertise in the relevant technologies. But don’t be afraid to hire people with varying degrees of learning curve required to be proficient in the job. We hired an intern this summer who didn’t know how to do what we wanted him to do this summer. And he figured it out. And I dare say he probably has a bit more confidence that the next time someone asks him to just figure something out, he will.
Talent Issues Limiting Growth. All I can say here is – developing talent and growing costs money. For many years, many companies have gotten by with minimum investment in people. I don’t mean training classes. I mean investing in real opportunities for people to learn by doing as well as training. And then investing enough in retaining talent so that the investment in education and self-improvement pays off.
I have to quote a telling paragraph from the original post:
Brooking’s analysis opens up several discussion points. With diversity and the educational pieces presumably in place, what then are the obstacles to acquiring the right talent? Are companies just terrible at recruiting? Are all the good engineers are in Silicon Valley or overseas? Perhaps even more provocative, are companies really investing in people and training their employees to become more highly-skilled instead of sourcing things out to get the razor-thin margins necessary to sustain their models? Whatever the case, the NYT surfaced data from the National Employment Law Project [below] showing low-end jobs are actually the ones making a comeback, again leading me to question how aggressive some companies are really approaching the recruiting process.
Great work. By next summer, I’ll report on some of our own talent investments at BP3. Maybe it is just the lack of VC funding that allows us to look further out for our investments than just the next year. We have time to invest and grow with the team we hire.