The next 12 months will be one heck of a ride for Connecticut employers. As Boomers look toward retirement and employers fight for qualified Millennials, I’m expecting a dramatic shift in the way businesses get things done in 2017.
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The next 12 months will be one heck of a ride for Connecticut employers. As Boomers look toward retirement and employers fight for qualified Millennials, I'm expecting a dramatic shift in the way businesses get things done in 2017.
Here are some of the trends I expect to see that will change the workplace forever:
An increase in the number of workers retiring in 2017 will be a major obstacle to growth for Connecticut companies. No one needs a crystal ball to know that the number of Boomers retiring within the next few years will continue to escalate. Yet, many growing companies have chosen to ignore that fact and it's going to be a big obstacle for growth sooner than they think. According to the Connecticut Business and Industry Association (CBIA) 3.6 percent of Connecticut's workforce will retire in 2017. And between 2018 and 2021 an additional 10 percent will join them. That means that in the next five years 13.6 percent of the workforce will be lost to retirement.
Almost every small business I've worked with this year has been facing this. Because they were so focused on running their businesses, business owners haven't built a strong middle-management team, something that's especially critical for a company once it gets to 25 or more employees.
More small businesses will be up for sale. This is another by-product of the agingof theBoomers. But unlike the first trend, these folks are probably well-aware of what this trend is going to mean if they want to sell their business. So, even though most of them haven't been quite ready to sell and retire up until now, expect a big chunk of them to start the process of selling their businesses. Some will do it in 2017 because they want to get a jump on their fellow Boomer business owners.
In Connecticut, it's projected that between 35 and 40 percent of these small business owners plan to sell within the next 10 years. That will mean lots of sellers and not enough buyers. And when those buyers do their due diligence about these companies, many will be turned off. They will find small businesses in which the owners haven't done enough to get ready to get out of the way.
The war on talent will heat up like never before. Next year, expect even more employers to be scrambling to fill positions. For the past 10 years, the average tenure for jobs has been 4.6 years. Now, with more Millennials moving into the job market, it's down to two years. Right now, 75 percent of full-time workers are looking for new opportunities and 48 percent of employers haven't been able to fill open positions. They just can't find people with appropriate skills to match these high attrition rates. This war on talent could result in some fairly bad hires and some unwelcome turnover rates. Businesses that don't do a good job recruiting, hiring and on-boarding will see their profits erode, or simply won't last.
Employee feedback will be a key to keeping talent. Today's employees want feedback. Having a well-established feedback system today is more critical than ever if a company wants to retain their good employees.
Employees today need instant feedback. This is particularly important for retaining Millennials.
This is a generation that grew up hearing “good job” and they expect regular feedback on a daily or weekly basis. Waiting an entire year to hear how they did during the traditional annual review doesn't work for them.
Adapting to the blended workforce will be a must. The blended workforce is one that combines traditional full- and part-time workers with independent contractors. Small businesses will increasingly seek “freelance workers” to join with employees to work on projects. We anticipate that within the next five years, 50 percent of the workforce will be independent contractors in one form or another. That's not a new phenomenon. Right now 34 percent of Connecticut's workforce is independent contractors. Businesses will have to learn how to deal with the blend between them and traditional workers.
Creation of remote workforce policies will become increasingly critical. Remote workforce policies will be a competitive advantage in 2017 for companies that need to compete for talent. Employees who are able to work at least one day a week from home report having higher job satisfaction.
The technology is here, but employers must have the policies in place to cover these arrangements and they need to understand the legal pitfalls they present.
Pam Butterfield is the founder of Manchester-based Business Success Tools, a small business advisory firm.
