The unemployment rate is a number that is talked about a great deal. Based on the number of people who allegedly want to work, this overly relied upon value is fairly dubious, but it does factor into a far more important number: wage growth. What makes wage growth more important is that it shows the strength of the economy by revealing the need for businesses to pay their workers more and the capacity of working consumers to spend more. Wage growth shows how well wealth is being circulated, or distributed, throughout the economy, which means the economy is working. Wage growth also reveals whether or not workers are progressing toward financial security and prosperity.
Proceeding the 2017 Labor Day holiday, hiring in the US slowed while lackluster wage growth stalled. A large part of the problem appears to be a lack of qualified candidates. Entrepreneurs like Tesla’s Elon Musk predicts technology will out-mode most jobs in the future, which will create the need for government to provide a universal basic income. Reliance on public welfare is an easy solution, if profitable corporations are willing to allow a significant share of their profits to be taxed and redistributed to a massive unemployed population. As this is an unlikely solution, which would also disenfranchise most of the population with terrible consequences, e.g. Yemen, solutions are needed that solve this long-term issue and today’s lack of qualified candidates.
The problem with the modern view of the workforce is the mentality of businessmen who treat the workforce like a commodity. Like precious metals, some employees are silver, others are gold, and an elite few are platinum while the majority are either copper or iron. Employees are graded based on their ability to fit the qualifications companies need to fill. They are not treated as individuals with unique skills sets and backgrounds, which means businesses cannot fully capitalize on their potential. Instead of tailoring roles in their businesses to utilize the skills of employees and candidates, businesses try to fit people into positions. Businesses struggle to find the qualifications they want, because people are so diverse and specialized.
Entrepreneurs can build businesses, because they are able to fill a need. Although a need might exist, an entrepreneur is only able to build a successful businesses when he or she is able to provide for that need. If the need, or demand, does not exist, the business will fail. When an entrepreneur is unable to find a way to utilize his or her resources and skills to fulfill a need, that entrepreneur is unable to build a successful business. The same is true of employees. The need for them exists. The employees have certain skill sets. The business owner or manager must find a way to utilize the employee’s skill sets to provide for an existing demand. Employers, therefore, need to approach hiring and promoting with an entrepreneurial spirit.
The workforce is a sea of human resources. Few employees will fit a position perfectly. As the needs of the business change, however, the positions and employees must change or be eliminated. Change is the only certainty. Employees must, therefore, be able to fill the needs of the business today and tomorrow. Employers must also foster adaptability in their employees. The only way to do that is to seize the opportunities presented by employees who may not be a perfect fit for an existing position. It is also the only way to create the opportunities and jobs people will need in the future. Instead of commoditizing people, businesses need to capitalize on their human resources to foster opportunity creation for their businesses and the economy.
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