CHICAGO, Nov. 7, 2013 /PRNewswire/ -- In the wake of the biggest shock to the labor market since the Great Depression, companies are confronting important questions regarding skill shortages, retention of top talent, and the most effective composition of their workforce. The Talent Equation—a new book by Matt Ferguson (CEO of CareerBuilder), Lorin Hitt (Wharton School, University of Pennsylvania) and Prasanna Tambe (Stern School, New York University)—explores the potential for big data to transform human resources and investigates some of the most important issues affecting the labor market and workforce management today.
The book, published by McGraw-Hill, is available for purchase now at all major Internet book retailers and will be on store shelves by November 15.
"Even with more than 11 million Americans looking for work, 45 percent of human resources managers say they can't find qualified candidates for their open positions," said Matt Ferguson. "This book is written for professionals who know more can be done to address this economic quandary. Whether they're executives implementing HR strategies on a daily basis, hiring managers wondering where their next star employee will come from, or job seekers coping with a challenging market, we hope readers of The Talent Equation come away with a better sense of how data analytics and other tactics can positively change recruiting and workforce management."
Navigating the Skills Gap
Research from the book shows 8 in 10 employers express concern over an emerging skills gap, but interestingly, only 4 in 10 say their company is doing anything to alleviate it. The Talent Equation explains how companies can attract skilled labor in a competitive talent market, including:
- Using labor supply and demand data to better understand the skills of available workers in various markets
- Raising wages to improve applicant pools and signal labor markets to address skill shortages
- Empowering employment by training and reskilling job candidates with potential
The authors discuss these issues and broader human capital strategies with HR and talent acquisition executives from leading brands.
Big Data Research
The Talent Equation introduces an original, landmark big data study of more than 2,700 employers and 33 million resumes in which the authors analyze relationships between a company's market performance, education attainment, and employee tenure. For some job functions, hiring more workers with college degrees significantly affects the bottom line. For instance:
- A 10 percent increase in customer service workers with college degrees is associated with about $26,000 higher value added per employee.
- A 10 percent increase in sales workers with college degrees is associated with about $31,000 higher value added per employee.
The implications of these large-scale exercises encourage business leaders to adopt data analysis into their everyday human capital strategy.
"At every stage of the employee life cycle, a big data approach to HR can help companies make smarter decisions about their workforce," said Lorin Hitt. "Prior work of ours shows that when companies adopt data-driven decision making, they seem to have higher corporate performance."
However, many HR departments are not yet prepared to flip the big data switch, according to the authors. Surveys show data analytics is not a specialty of most HR professionals, and the McKinsey Global Institute predicts that in just six years the U.S. may be short up to 1.5 million data analysts and business managers capable of putting complex information to use.
"Companies have to ask: Do we have the right tools in place, the right data, and the right people to create the most rigorous human capital analytics strategy?" said Prasanna Tambe. "Those are significant considerations that may take time to weigh fully. The conversation around how best to use big data in HR is going to be with us for a while."
The Changing Workforce
The launch of The Talent Equation coincides with a new report from CareerBuilder and Economic Modeling Specialists Intl. (EMSI) on the projected fastest-growing occupations in the U.S. from 2013 to 2017. The five-year projections identify many of the key labor market realities laid out in the book:
- The U.S. workforce is projected to grow 4.4 percent from 2013 through 2017. The strongest growth is often found in occupations supporting the health care and energy industries, or occupations related to information technology.
- At 5 percent, high-wage occupations ($21.14 per hour and above) are expected to grow faster than low-wage ($13.83 and below) and medium-wage ($13.84-$21.13) occupations (4.7 percent and 3.3 percent respectively).
- 75 percent of the 165 occupations expected to lose jobs nationally are in the middle-wage category.
- Occupations requiring college degrees are growing significantly faster than those that do not. Associate degree and master's degree occupations are each projected to grow 8 percent, while jobs requiring short-term, on-the job training trail at 4 percent. Bachelor's degree jobs are projected to grow 6 percent.
To read more about the projections and download the full report, please visit the CareerBuilder press room. Visit www.talentequationbook.com to download a sample chapter, learn more about big data and HR, and watch a video interview with the authors.
About The Talent Equation Authors
Matt Ferguson is the president and CEO of CareerBuilder, the global leader in human capital solutions. Under his leadership, CareerBuilder skyrocketed to the No. 1 position in the online recruitment industry within five years. Ferguson has appeared on CNBC Squawk Box, ABC World News, CBS Evening News, Bloomberg TV, and the TODAY Show, among others. He was named to Crain's Chicago Business "40 Under 40" and ranked in the top 10 list of Glassdoor.com's "Highest Rated CEOs."
Lorin M. Hitt is a professor of operations and information management at the University of Pennsylvania, Wharton School. He is currently a member of the Information Strategy and Economics Group and a Senior Fellow of the Wharton Financial Institutions Center. Hitt's work has appeared in a variety of academic journals, including the Quarterly Journal of Economics, the Journal of Economic Perspectives, and Information Systems Research.
Prasanna Tambe is an assistant professor of information, operations, and management sciences at the New York University Stern School of Business. Tambe's research has been published in Management Science, Information Systems Research, and Information Economics and Policy, and has been mentioned in press outlets including CNBC, The Wall Street Journal, and Forbes.
CareerBuilder is the global leader in human capital solutions, helping companies target and attract great talent. Its online career site, CareerBuilder.com®, is the largest in the United States with more than 24 million unique visitors and 1 million jobs. CareerBuilder works with the world's top employers, providing everything from labor market intelligence to talent management software and other recruitment solutions. Owned by Gannett Co., Inc. (NYSE: GCI), Tribune Company and The McClatchy Company (NYSE: MNI), CareerBuilder and its subsidiaries operate in the United States, Europe, South America, Canada and Asia. For more information, visit www.careerbuilder.com.