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Demand for STEM skills—advanced knowledge of science, technology, engineering and mathematics—is exploding worldwide, as organizations and economies seek to drive growth. While some emerging economies are producing plentiful STEM talent, talent supplies are not keeping pace with demand in many countries. Thus organizations face a location-mismatch problem: Talented people are available but not always in the place where they are needed.
Consequently, developed- and emerging-market companies alike will need to find and gain access to STEM talent. But searching for skills in the global talent market is costly. And establishing outposts in countries with unsettled governing institutions is risky. Moreover, companies lack information about where STEM skills are located. Even if they know where skills exist, they may encounter barriers to access, such as government policies.
The authors of this research report offer suggestions for how organizations can secure STEM skills, including augmenting use of staffing agencies and online job boards with newly emerging types of labor-market intermediaries.
We initiated this research to address the fact that demand for STEM talent will likely explode in the next decade—in high-tech companies as well as numerous other industries. In addition, we believe that developed- and emerging-market companies may compete more fiercely for talent. The latter could become tough contenders as they seek to compete on product innovation instead of cheap labor, as economic growth in their countries inspires entrepreneurship and creates new professional opportunities, and as their governments limit local employees’ mobility.
Equally worrisome, the global labor market for STEM talent lacks mechanisms for matching talent demand with supply across geographic boundaries—making it difficult for companies in developed and developing markets alike to find and attract talent. To remain competitive in the coming years, organizations from every industry, in all geographic regions, will need to solve the location-mismatch problem.
In the US, employment in STEM occupations is projected to grow almost two times faster than the average for all occupations over the next decade.
China, India and Brazil are producing more STEM talent than the US, the UK and Japan.
The emerging global labor market for STEM talent lacks mechanisms for matching demand and supply of critical skills across geographic boundaries.
Most companies judge themselves ill-equipped to solve the location-mismatch problem.
Efforts to produce “business ready” STEM talent include degree programs that integrate science courses with business courses as well as new courses of study, such as a Master’s of Science in Analytics.
New types of labor-market intermediaries are emerging and could help companies secure STEM talent. These include online platforms where companies can post data sets and problems to be analyzed and answered, and networks of retired scientists and engineers whom companies can call on to work on projects.
Most companies judge themselves ill-equipped to solve the location mismatch on their own. This is not surprising, since securing STEM talent globally is a daunting task. First, the costs of searching for skills in the global talent market can be prohibitive, and establishing outposts in politically unstable countries is risky.
Second, companies lack data about where skills are located. Even if they know where skills exist, they may barriers to accessing them, such as employees’ unwilling to move, government policies and infrastructure inadequacies.
Third, traditional approaches have limitations. For example, “building” skills through training takes too long. Efforts to “buy” them on the external labor market can be stymied by lack of information and access. And “substituting” skills with technology is difficult because STEM talent’s unique qualities are impossible to program into software.
For these reasons, organizations will need innovative skills and sourcing strategies. New types of labor-market intermediaries could become essential components of those strategies.
Organizations should begin now to plot out their strategy for finding the talent they need to compete and win.
Organizations must also make forecasts of talent supply an integral part of their talent acquisition and management strategy. Because traditional means of securing STEM skills (build, buy and substitute) all have inherent difficulties, companies should make savvy use of labor-market intermediaries.
Organizations should seize the opportunity to augment use of long-deployed labor-market intermediaries (such as staffing agencies and online job boards) with new kinds of intermediaries that make it easier to match STEM demand with supply.
Elizabeth Craig is a research fellow at the Accenture Institute for High Performance. She is the author, with Peter Cheese and Robert J. Thomas, of The Talent Powered Organization: Talent Management and High Performance.
Robert J. Thomas is the executive director of the Accenture Institute for High Performance and the author of co-author of seven books on leadership and organizational change.
Charlene Hou is an analyst with the Accenture Institute for High Performance.
Smriti Mathur is a senior analyst with the Accenture Institute for High Performance.
July 24, 2012
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