Today’s private-sector organizations are in business for tomorrow. After all, the very notion of corporate strategy is to look ahead ‒ to future markets and future growth, all while building an engaged workforce whose well-being ensures a future of work/life success and secure retirement.
But global organizations must contend with the challenges of a complex world, in which human capital needs may be difficult to meet. As populations age in the mature economies, the progress of new entrants into the workforce may be slowed, while the realities of global unemployment are stark. More than 200 million people are out of work, many of them young people who lack the skills the private sector seeks.
As the World Economic Forum’s Human Capital Report 2015 points out ‒ through its extensive Human Capital Index, which ranks countries on the basis of education and workforce dynamics, and allows for comparisons across regions and income groups ‒ improved workforce planning and better design of education policy are vital components for meeting the human capital challenge.
Clearly, it is no longer enough for the private sector to expect educational systems to produce candidates who possess the precise skills-sets required for today’s and tomorrow’s jobs. Collaboration with educational institutions, not-for-profits and government organizations can help bridge the gaps that separate students and the unemployed from acquiring the right skills, guidance and opportunities.
Fortunately, far-sighted companies are now making inroads to address this global talent crisis, and good examples abound in another new Forum report, Disrupting Unemployment: Business-led Solutions for Action. With its compendium of nearly 80 case studies, the report demonstrates the wide spectrum and diversity of opportunities for the private sector to make a difference, alone or in collaboration with others.
These case studies fall into three categories:
- Develop Employment Skills. These are aimed at function-specific skills, whether technical, vocational or academic, as well as problem-solving and idea communication plus retraining and upskilling programmes.
- Foster Entrepreneurship. Businesses can go beyond their own human-capital limits and enhance the economic ecosystem by encouraging entrepreneurship along the value chain via financial support for start-ups and non-financial support such as training, mentoring and networking.
- Connect Talent to Markets. These seek to connect employees and employers through counselling, changing perceptions and ensuring the inclusion of traditionally marginalized or disadvantaged groups.
Reviewing this research, I found it inspiring to see so many examples of organizations taking it upon themselves to make a difference ‒ not only in terms of global unemployment, but of youth unemployment in particular ‒ often without direct benefit to the company so much as long-term benefit to society.
For instance, Credit Suisse undertook the STEM Brazil global education initiative to improve the quality and delivery of STEM (science, technology, engineering and maths) education in Brazil. The company collaborates with Worldfund Brazil to train teachers to improve the quality of STEM education in Brazil’s high schools through interactive and project-based learning that focuses on real-world problems as points of departure for learning science and maths. These include pollution, health/life problems, toxic waste and urban mobility.
Then there’s Deutsche Bank’s Born to Be programme, which targets the skills gap between what schools teach and employers want. So far, more than 400,000 young people worldwide benefit from some 140 programmes, while Deutsche Bank employees have volunteered 40,000 hours for education projects and skills-transfer support efforts. Similarly, Google’s Activate programme provides free online and face-to-face training in digital skills, targeting unemployed youth in Spain and Latin America.
As for fostering entrepreneurship, few efforts are as impressive as MasterCard’s Global Girls Entrepreneur Project. This project helps high-school girls in low-income communities develop an entrepreneurial mindset through female mentors and business and leadership skills that spur innovation and exposure to STEM careers. Importantly, it’s a partnership between the MasterCard Center for Inclusive Growth, the Coca-Cola Foundation and the Network for Teaching Entrepreneurship (NFTE). Implemented in five US markets during 2014-2015, it will expand internationally.
And as for connecting talent to markets, there’s Dell’s 2020 Legacy of Good Plan, launched in 2012 as a first step towards a new sustainability strategy for Dell. One focus is to publicly commit to a long-term goal of increasing university-level hiring from 7% to a rate of 25% of all external hiring by 2020. This requires each Dell business unit to identify skills-sets, numbers and locations globally for graduate intake over the next three years, with the appropriate onboarding, training and career paths in place.
Indeed, such programmes as these and the many others cited in the report touch on the varied aspects of developing human capital in a world of inequality. Obviously, there are skills gaps and education gaps, poverty gaps and connectivity gaps, but throughout the world, the gender gap looms large. Recent Mercer research affirms not only that women are under-represented at all levels of the global workforce, but also that eliminating the male and female employment rate gap has real economic benefits. Underutilization of female talent is a critical business issue, and programmes such as those described in Disrupting Unemployment can go a long way towards balancing the scales.
Still, the scope and complexity of global human-capital development isn’t going to yield to quick fixes or well-intentioned pilot programmes. As with most private-sector change initiatives, it takes real vision to ensure a sustainable future. For example, the emphasis on technical skill and STEM education risks devaluing the eternal verities of the arts and humanities. Yet those disciplines remain important to the development of creative, conceptual thinking ‒ thinking that leads, ultimately, to the innovative, outside-the-box solutions, without which businesses stagnate.
Such vision, along with commitment and collaboration, can secure the future for the private sector and its workforce. Is your company taking the long view?
Author: Ilya Bonic is a Senior Partner and President of the Talent business at Mercer
Image: Employees have a discussion at the innovation lab of Swiss bank UBS in Zurich January 16, 2015. REUTERS/Arnd Wiegmann