The labor market is in a strange position right now – on one side of the coin, companies are being forced to cut costs by making sections of their workforces redundant.
Thankfully, this trend has slowed since its 2023 peak – but on the other side, businesses are still struggling to employ workers with the right skills to move forward.
Continuing geopolitical tensions and emerging sovereignty requirements, exemplified by the number of cloud hosting providers and cloud computing services that are now offering more localized options, have only amplified the talent shortage across all industries, from tech to manufacturing.
Sovereignty and talent scarcity
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The global talent shortage has been amplified by a growing trend toward national sovereignty in two, totally different ways. One one hand, companies are looking to locate workers within specific boundaries to comply with evolving regulations, but elsewhere, they’re looking to migrate tech closer to home, too, resulting in surged demand for highly skilled tech workers across the entire supply chain.
While these moves are aimed at reducing dependence on foreign supply chains, they have also highlighted a critical issue – the US alone faces a shortfall of approximately one million experts in various high-tech fields, with Europe likely in a similar position.
Geopolitical tensions are adding to the problem
Tensions between the US and China have further complicated the global talent landscape. Deteriorating relations between two of the world’s biggest economies have led to restrictions and total limitations not just for advanced hardware, but other elements of the supply chain, too, including talent.
The knock-on effect of this is that countries all over the world, allied with the US, China, or other interests, have been increasingly reducing reliance on other nations by moving processes closer to home.
Consequentially, workers that previously benefitted from overseas recruitment opportunities are now finding themselves with fewer opportunities, as well as evolving skill requirements from employers.
Furthermore, the companies able to hire abroad are now turning to local talent, which might not be as suitable. Talent acquisition strategies are now under consideration, but change rarely happens overnight and the struggle could continue.
Moreover, the rapid ageing of the global workforce, particularly in developed countries, has created a pressing need for skilled workers to replace retirees. But with key roles no longer being filled by younger workers, healthcare, logistics, manufacturing and other sectors are having to turn to tech to plug the gaps.
AI’s role in bridging the gap
Step in AI. Artificial intelligence and automation, while young, are already showing promising signs of improving worker productivity and company efficiency, as well as filling roles that are maybe not so attractive to humans.
While the emerging tech offers a partial solution, experts are warning that it’s nothing more than that, emphasizing the need for businesses and governments to develop human capital with education and training programs designed to help them thrive in an increasingly automated world.
Keen to demonstrate the country’s potential and reinstate the reputation as a technological hub that it held under Soviet ruling, Armenia’s tech firms and state officials gathered at DigiTec to show what they have to offer not only to the country, but to the world.
Coinciding with the gathering of leaders, officials and media at the World Congress on Innovation and Technology (WCIT) in the country’s capital, Yerevan, the DigiTec expo hall was filled with startups and more established companies keen to show off their contributions to the world of technology.
Among the exhibitors were representatives from the Armath initiative, designed to interactively educate young teenagers about STEM and their potential within the sector – an apparent success given its international reach and the fact that many of the exhibitors showing off their startups were ex-Armath students.
Summary
With the global population at an all-time high, the world is in the depths of one of the most severe talent shortages that has ever been, but the complex nature of the various factors contributing to this means that the struggles could continue for several years, or even decades.
As countries prioritize self-sufficiency, particularly in critical industries where unauthorized access could be catastrophic for economies and populations, the demand for skilled workers continues to outstrip supply.
Although tech firms are stepping in with endless AI tools, experts are warning that artificial intelligence is nothing more than a coworker, which does at least pacify initial concerns that the technology could replace human workers.
Those looking to futureproof their roles should consider upping their upskilling efforts and becoming more adaptive to emerging technologies so that they can plug gaps in the most efficient ways possible.
