Workforce management trends and events of 2009

Posted by: Joel Capperella

With 2009 rapidly coming to a close, it’s time to look back and identify the trends and events that mattered.

There are some obvious factors that influenced workforce management planning and execution over the past 12 months, but a more discrete look reveals why, beyond economic turmoil, 2009 will go on the books as a year of challenge and disappointment.

Here are the top 10 workforce management trends of 2009.

1. Unemployment. Obviously, the most significant impact on strategic workforce planning in 2009 came from the more than 10 percent unemployment rate. The furious pace of reductions in force that lasted throughout the year left employees jobless, and firms operating with skeletal crews. The impact was several-fold. The overall composition of the workforce is unlikely to return to pre-crash levels. Operational and cost efficiency, and the fact that many firms were caught flat-footed when the economy crashed, is driving firms of all sizes to be more creative with their workforce and better leverage the “non-employee.” The initial step is to categorize each segment of the “non-employee” workforce. Secondly, ongoing wage freezes and workload increases that came as a result of workforce reductions have had a serious negative impact on job satisfaction. Firms will do well to plan for any sort of recovery by ensuring that poor job satisfaction doesn’t result in the mass exodus of employees when new opportunities arise.
2. Independent Contractor Litigation. The intersection of a lagging economy, state revenue shortfalls, and large communities of independent contractors sparked an increase in audits of independent contractor usage at large and often, cross-state located firms. With state revenue still in dire straights, this is a practice we see continuing into the new decade.
3. Social Media. LinkedIn became the millennial version of the depression-era “will work for food” signs. You know the ones, the sepia colored newspaper photo of the down-and-out worker selling apples or some other commodity. This physical manifestation of the unemployed was just one example of how 2009 served as the year that the technology of employment moved well beyond the job boards. Personal YouTube pages, Facebook profiles, and Twitter accounts were leveraged for good, bad, and indifferent by those seeking unemployment, or seeking candidates. In many instances, individuals learned the importance of privacy, often ruining their employment chances with ill-conceived social media posts. It’s a trend that is likely to stick around for a long time, well, at least until Web 3.0.
4. Invisible Green Jobs. There was much talk in the 2008 presidential campaign about the green economy and the deluge of green jobs that would immediately inject life into our floundering economy. Unfortunately, 2009 ended up not being the year the economy turned green. Currently, this barely-existent sector holds promise, but it didn’t put even a dent into unemployment in 2009, and it’s unlikely to do so in 2010 either.
5. Employee Loyalty. By examining the rate of job movement, it would be easy to conclude that employee loyalty increased in 2009. However, satisfaction surveys uncovered more fear than loyalty this year. Job movement was hindered by the unavailability of opportunities, not necessarily an undying love for a current employer. Employees in 2009 felt more indentured than employed. The psyche of the employed took a beating, and 2010′s moderate recovery projections aren’t likely to be an immediate antidote.
6. Statement of Work Scrutiny. This past year ushered in a new climate of scrutiny over the project budget and the practice of leveraging the statement of work (SOW) to drive deliverables. Bad news for consultancies and professional service firms. Good news for staff augmentation firms. Consumers of the traditional SOW are being forced by operations and finance departments to be extraordinarily more discrete with what is put out to bid as SOW. And they’re demanding acceptable SOWs be aggressively priced by instituting defined categories and spend thresholds. Staff augmentation firms have been the beneficiaries, their ability to quickly deliver targeted talent providing cost-efficient alternatives.
7. IT. Jobs in information technology were perhaps the one area that remained at a fairly consistent level year-over-year, from 2008 to 2009. IT is one sector that capitalized on external conditions to implement action plans that did not require additional capital investment. This translated into the roll-out of “shelfware,” i.e. unused software licenses, and overdue infrastructure changes that could be executed with minimal hardware requirements.
8. Power Shift. Corporate services, specifically finance, human resources, and procurement, played a more strategic role and had greater authority over the enforcement of cost-saving processes. Business units were more beholden unto the processing requirements of these three support organizations, and the reward was operational and fiscal opportunity.
9. Operational Efficiency. A lot of firms underwent cost saving expeditions. Talent supply chains were evaluated for quality and performance against the dollars that had been historically directed to service providers. This resulted in a maturation of certain areas of contingent workforce management. Many firms discovered in their supply chain analysis that simple visibility into the supply chain was non-existent, thus allowing for significant improvement with minuscule supply chain ordering.
10. Stimulus Delay. While it can be argued that the new administration’s economic stimulus package helped soften the blow of the recession, the corresponding jobs did not come. It remains to be seen what the political impact will be, but 2009 will be remembered as the year that the largest increase to the federal deficit, in the history of the deficit, resulted in negligible improvements to the workforce.