By Steven B. McKinney

McKinney Consulting Inc.

It seems that everyone I speak with in business, politics or socially is concerned about the global economy. U.S. President George W. Bush and Democratic candidate John Kerry definitely have it on their minds. Another popular dinner discussion is, Where have the jobs gone? Have they gone to outsourcing, competitiveness, consumer spending or a combination of all of these factors? Keep reading and find out what the professionals predict and the proof to back it up.

We are cautious about current economic factors, yet research from many sources indicates that we have reason to be optimistic. The Association of Executive Search Consultants (AESC) reveals that 73% of its members think the global economy will be strong for the second half of 2004, and 69% believe that their executive search firms will see a strong demand for services in the same period. And according to the latest survey conducted by PricewaterhouseCoopers Management Barometer, senior executives at most large U.S. companies plan to increase both hiring and investments over the next 12 months amid growing optimism about the economy.

So where are the jobs? The Rand Corporation produced a large study on the employment situation. Their search for answers about the changing workforce (available for download) as mentioned in the Washington Times focused on several key factors:

What are the forces that will continue to shape the U.S. workforce and workplace over the next 10 to 15 years? With its eye on forming sound policy and helping stakeholders in the private and public sectors make informed decisions, the U.S. Department of Labor asked RAND to look at the future of work. The authors analyzed trends in and the implications of shifting demographic patterns, the pace of technological change, and the path of economic globalization.

As indicated in the selected Rand text, one main focus was the dynamics of demographics. Changing demographics combined with globalization and advances in technology shows that the workforce is growing more slowly and becoming increasingly technology oriented. Additionally, the workforce is more diverse, with more females and an increase in the number of older workers. As a result the workforce will be harder to find and retain. Research confirms this theory. TalentMax, a talent management consulting firm, revealed that their latest report indicated that 81% of human resource departments expect to see greater competition for talented executives.

Additionally, the Rand study showed these key findings:

The baby boom is long since over. The annual growth rate of the nation's workforce is expected to slow to a nearly static 0.4 percent by 2010. That's a sharp decline from the 1.1 percent annual increases seen in the 1990s and the 2.6 percent annual increases experienced during the 1970s. The slowing workforce growth rate is caused primarily by a 25 percent decline in the birthrate that followed the end of the baby boom in the mid 1960s, coupled with a trend toward earlier retirement by men.

The influx of immigrant workers and women into the workforce has counteracted these forces so that the workforce has continued to expand, albeit at a slower rate.

Technology will continue to shape the U.S. economy in greater ways, and the pace of those impacts will be accelerating. The report says that with advances in technology and an increasingly global economy, employees will be more mobile and work in more decentralized, specialized firms with less formal and more individualized employer-employee relationships. While technology has many benefits for the workforce, such as increased productivity, it also forces workers to maintain their skills through lifelong learning. Workers with fewer skills will command much lower salaries and risk job loss to their better-trained counterparts -- domestically and globally.

Economic globalization will affect industries and segments of the workforce that in the past were relatively isolated from outside competition, boosting trade, affecting capital flows, encouraging mobile populations, and causing rapid transfer of knowledge and technologies. While some sectors might experience a net loss in jobs and market share, those consequences should be counterbalanced by gains in other sectors. 

How do the implications of this study apply to South Korea?

Koreans are not quite so optimistic about the near future. Though Korean companies are becoming more positive, a slight majority are still pessimistic says the Federation of Korea Industries (FKI). FKI, which represents Korea’s biggest industrial groups, conducted a business confidence survey in August 2004 of the 600 largest companies by sales on their outlook for exports, domestic sales and capital investment for the month ahead. The business confidence index, a gauge of how companies perceive the business environment in the coming month, was at 95.6 points, compared with 86.4 in July. While this is a significant jump in confidence, a reading below 100 indicates most respondents are still pessimistic about the economy.

However, just like the other Organization for Economic Co-operation and Development (OECD) countries:

South Korea is subject to the same global trends: an aging workforce, a workforce that is growing more slowly, becoming more technical, with more females and migrant workers entering the workforce population.

The workforce is becoming harder to find and retain as the qualifications for individual positions increase and the competition for talent races on.

Korea is one of the leaders in technology and this is an area of priority growth for the current administration.

The economic globalization affects Korea as well, with foreign direct investment being the driver of the local economy.

As a result, some industries will increase while others will fade away.

In summary, employers must accept change as the normal path, and staying abreast of emerging technologies withn their industry is mandatory for survival.  The future of the workforce will be based on survival of the fittest.  Continued training and appropriate staff development for employees will have to be standard operational procedures in order to hire and retain the best talent.

Employees of the future must change their ideas of a standard career path and develop what some outsourcing firms call employability skills. Rather than focusing on one skill or area of expertise, an increasing number of students are being educated in multiple disciplines. Continuing to upgrade one’s abilities is the new standard. Job seekers who are willing to do so will no longer have to look for jobs that seem to be hiding; rather, firms will seek out these qualified individuals.

About the Author: Steven B. McKinney is the founder and president of McKinney Consulting Inc., Korea's most trusted executive search firm.  McKinney Consulting offers a comprehensive range of personalized, professional resource services to a wide cross-section of companies operating in Korea and Asia.  Mr. McKinney is a globally established commentator on international management.  He can be reached at This email address is being protected from spam bots, you need Javascript enabled to view it