The current situation on the labour market and the resulting corporate culture

Table of contents

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1. Introduction
1.1 Status Quo
1.2 Goal and construction

2. Current situation on the labour market
2.1 Shortage of specialists
2.2 Demographic change
2.3 Change of values

3. Change of Corporate Culture
3.1 Flexible work time models
3.2 Diversity management
3.3 Culture of learning
3.4 Team work

4. Conclusion

Bibliography

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Illustration 1: Age structure of the population in 2013 compared to 1990

Illustration 2: Age structure of the population in 2013 compared to 2060

1. Introduction

“ It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is most adaptable to change.“ – Charles Darwin, Scientiest

1.1 Status Quo

The economy is booming (Federal Statistical Office, 2017), the unemployment rate is lower than ever before (Federal Agency for Work, 2017), we are becoming more mobile (Federal Sta- tistical Office, 2013), the labour markets are more transparent and more global (Trost, 2012, p.9), the values are shifting (Inglehart, 1977, p.2) and the demographic change can no longer be averted. At the same time products are becoming more interchangeable and people with special abilities and creative ideas are becoming an increasingly important sucess factor (Trost, 2012, p.10). The economy is in transition. But where does this change lead to?

All these factors cause that companies are struggling to find employees and need to change their corportate culture. Especially for skilled employees and executives the competition is becoming more and more important and tougher. The balance of the power in the labour market has chan- ged. While companies could choose their employees in the past, employees can now choose which company they want to work for. Companies must adapt to these new conditions and present themselves as an attractive employer. To achieve this, small measures such as employee benefits are no longer sufficient, but the entire corporate culture must be questioned and reorien- tated.

1.2 Goal and construction

The presented research paper deals with the current situation on the labour market. Furthermore it will show how corporate culture is designed nowadays to meet the demands of employees.

To get a first impression the first chapter will introduce the topic. Further the goal and the construction of the research paper are clarified in that chapter.

The second chapter will give an overview about the current situation on the labour market. The goal is to explain the topic in detail and reflect factors that have changed. Few of the many are the lack of specialists, the demographic change and the change of values.

Chapter three will illustrate the corporate culture starting with its defintion. Afterwards different parts of corporate culture will be examined and described such as how a company can create a workspace and work atmosphere that will attract employees. This includes flexible work time models, diversity management, culture of learning and team work.

The research paper ends with chapter four which sums up the most important findings of this document.

2. Current situation on the labour market

2.1 Shortage of specialists

There is an increasing shortage of workers. In 1998 the company McKinsey predicted for the first time that by the year 2020 approximately six million workes will be absent. These workers are especially professionals and executives (Thiele, 2009, p.1). Please note that the expressions „professionals, specialists and experts“ used in this work have the same meaning.

Professionals are people who have completed vocational training or who have a degree as a technician, master oder specialist. Also university and university of applied sciences graduates are called specialists. In practice, employees with many years of experience are also considered to being specialists. A specialist is of great importance to a company and can only be replaced with great effort. The training takes several years (Schneider, 2013, p.9).

A recent study by the German Federal Statistical Office (2018) shows that skilled workers are missing in many different areas. The most acute search is currently in the care sector. But also scientists, technicians, Human Resources employees, Information Technology workers and doc- tors are urgently needed. There are many reasons for this. For example, carers are paid very poorly and there are hardly any graduates in the so-called MINT (mathematics, information, na- tural science, technology) subjects.

The struggle for professionals starts with the gaining of employees and is progressing in employee retention measures. In order to be more successfull than the competitors, companies not only have to be more attractive to the outside but also have to deliver the expected perfor- mance internally (von der Oelsnitz et al., 2007, p.56). Human Resources policy, strategic and innovative measures are needed to succeed.

2.2 Demographic change

One of the reasons for the lack of employees is the demographic change which results from a continously increasing life expectancy of the population, the development of the immigration and emigration as well as a permanently low birth rate. This overages our society (Federal Mi- nistry of Health, 2015). It does not only have implications for social and health care but also for the recruitment conditions for companies because they have problems filling vacancies (Boll- witt, 2010, p.11). The 13th population calculation by the Federal Statistical Office from 2015 makes it clear that the german demography is in transition.

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Illustration 1: Age structure of the population in 2013 compared to 1990 (Source: German Federal Statistical Office, 2015, p.11)

The comparison of the years 1990 and 2013 shows that the birth chorts of men and women, which were still in their early working age in 1990, reached their high working age in 2013. In the last 20 years, the number of births has decreased almost steadily. In addition, the number of over 70-s has increased significantly while the number of people under the age of 20 has de- creased considerably. Meanwhile not only women reach a higher age, but also men. Overall the population pyramid has become more symmetrical.

Currently Germany has about 82 million inhabitants. By the year 2060 this number will shrink to between 65 and 70 million. This is mainly due to the low birth rate which is around 1.4 child- ren per woman. For a balanced generation, it would have to rise to 2.1 (Thiele, 2009, p.10). The low birth rate also reduces the number of potential mothers.

While in 2013 (see Figure 2) 18% of the population were still children and adolescents under the age of 20, 61% were 20-65 year-olds and 21% were 65-year-olds and older, by 2060 only 16% of the population is under 20. The proportion of 20- to 65-year-olds, and thus the potential workforce will drop to 52% and one in three will be over 65. In addition, almost twice as many 70-year-olds will live as children will be born (German Federal Statistical Office, 2015).

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Illustration 2: Age structure of the population in 2013 compared to 2060 (own presentation)

Every year around 200,000 more workers retire than young people are starting in the labour market. Thus, the number of potential workers will be reduced from 44.4 million to 38 million between 2005 and 2060 (German Federal Statistical Office, 2015).

The aging and shrinking of society and thus of potential employees are the central consequences of demographic change. This is accompanied by the increasing qualification requirements for employees. The transformation of the population can no longer be stopped by demographic me- ans. Companies need to adapt to aging staff and ever-tougher competition for employees, which can only be tackled through changing the corporate culture.

2.3 Change of values

Another factor that influences the labour market is the change of values of society. In the context of this paper values are defined as morally presumptuos notions of behavior that are considered desirable in a group, sociaty or culture. They give people orientation about what is good or bad, what is desirable or undesirable and thus being the basic element of every culture (Inglehart, 1977, p.19).

Researches like Inglehart and Klages (1977, p.19) call the change in values a transformation of the culture of acceptance and obligation to the culture of self-realization. In the fifties, people lived to work and values like economic growth and livelihood were top priorities. Meanwhile one works to live. Through change the society attachs more importance to one’s own self- development and one’s enjoyment of life. It insists on its free time and accepts that women and men are equal. On the other hand, individuals no longer want to subordinate themselves and al- low themselves to be integrated into structures and regulations. Society is becoming more skep tical about traditional values and norms of industrialized nations such as performance, economic growth and technological advances (Rosenstiel, 1993, p.10).

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