This Week's Herman Trend Alert

Leadership in Normal 2.0

  The Herman Trend Alert

January 30, 2002

The Churning has Begun

The first people hired in a reheating economy are key executives needed to lead the charge. Many organizations bring in new blood specifically charged with substantial growth. Smart companies will strive for strong positioning on the leading edge of the expansion.

More aggressive recruiting of executives has begun. From a number of sources, we have indications of significant movement-among recruiters, among executives accepting new positions, and among relocation companies engaged to manage moves. This activity is the first step in the transformation back to a lively economy, and it is quietly beginning.

The next targets of recruiters will be middle managers with specific talents. Depending on their needs, savvy companies preparing for growth will seek experienced marketers, sales professionals, manufacturing managers, logistics specialists, and others, depending on the nature of their business.

Expect an unprecedented churning in the American labor marketplace, beginning in the third quarter of 2002. As the economy heats up, refreshing opportunities and aggressive recruiting will challenge loyalties. Wise employers will engage in strategies now to build positive relationships with their employees. Employers will invest in training, development, and coaching efforts to strengthen the bonds with valued employees.

Economically, we see slow growth starting in first quarter 2002, with more apparent signals surfacing in the second quarter. Economic futurists anticipate 4-5% growth rate by fourth quarter. As the country gets back on track, latent American optimism will resurface with the strong economic projections laid out at the start of the decade. We'll move back into a boom mentality, causing severe difficulties, as employers' demands for workers cannot be met. The country is currently approximately five million workers short, a figure exacerbated by the need for competencies in short supply.

Complicating this intricate web of interacting trends and factors is an increasing tendency for workers, particularly young people, to take more control of their own careers. Demands for life balance, telework, and personalized compensation and benefits will drive many employers to undertake major changes in the way they do business.

American trends are followed by similar trends elsewhere. Lag time may be shorter than in the past.

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