Exploring the Talent Shortage Problem in Latin America

Today’s post comes to us from advisory board member Ivonne Vargas, and it provides perspective on the talent situation in Latin America.

The combination of technical skills and human strengths required of employees today — and in the immediate future — does not resemble what certain industries find in the labor market today within Latin America. México, for example, has begun to suffer from a lack of talent, particularly in areas such as construction, information technology and technology in general, and commerce.

There are sectors that have faced exceptional growth when it comes to job creation, such as finance technology. So far this year, this sector has increased 182% in terms of job opportunities, according to figures reported by the consulting firm Robert Walters.

The disappointment arises when, although there is demand, the supply of talent is not sufficient, as this threatens to stop the growth machinery in certain sectors. In Mexico, by the way, 69% of employers face a talent shortage — the biggest number in the last 10 years.

The talent shortage is a real problem in other Latin American countries: Argentina (73%); Costa Rica (67%); Colombia (61%); Guatemala (78%); Panama (65%); Perú (67%).

Which Industries Are in Danger?

Talking of Mexico, for example, according to ManpowerGroup, 65% of construction employers report difficulties in finding the required skills; however, 57% of directors want to increase their staff during the third quarter of the year in this country. The percentage of talent shortage changed, according to the industry.

IT and technology also experience similar problems, according to 68% of those surveyed by ManpowerGroup. In addition, 63% want to increase their staff in the same period.

The generation of human capital required by high-tech companies is today diminished by the lack of profiles with certain skills, particularly when it comes to highly qualified engineers and technicians.

A city with a remarkable development in México (Querétaro), which is rebounding in the transformation industry in the country, generates 237,995 jobs in the state, according to data from the Mexican Institute of Social Security. But this is just one example of the various productive activities in which employers need to invest up to seven months or more to train staff. The training acquired in school becomes obsolete faster.

In my experience, applying strengths tests for candidates, the soft skills that IT and technology employers look for — and don’t find easily — are collaboration and teamwork, self-discipline and reliability, resilience and adaptability, critical thinking and analysis, as well as creativity and originality.

What About Commerce?

Commerce, the most proactive sector in hiring, also presents a shortage of talent in

commercial roles (wholesale and retail). Employers in this area also have the strongest outlook for expanding talent in work teams (65% intend to hire for this quarter of the year, according to the ManpowerGroup study). However, when asked about the difficulties in finding certain skills, 69% of employers admit that they cannot fill vacancies quickly.

Even sales and marketing are listed as the third-most-demanded position by employers in México. In addition to this activity, there are four other profiles with greater complexity to recruit: front office and customer service; operations and logistics; administration and administrative assistant; and IT and data analyst.

In the case of commerce, the top soft skills that companies are looking for the most include resilience, adaptability, and self-discipline.

What Trends Are Driving the Demand for Talent?

Recently, global logistics company DHL announced the inauguration of a school to work on the technical skills of its operators in México. This news shows the increasing need to add new skills all the time. In addition to this trend, there are others that will push the demand for more professionals urgently to be covered. Consider the following trends:

Human vs. Robot
More than 80% of employees have moved towards digitization in response to COVID-19. Intelligent machines and artificial intelligence (AI) will allow people to specialize in such human strengths as empathy and honesty, judgment and creativity, training, and compassion, among others. One in three organizations plan to invest more in technology and AI, including machine learning this year.

Digitization is Adopted at Full Speed
One in five organizations, according to ManpowerGroup, have trouble finding tech talent. In addition to what I discussed above, what are the positions with the most demand? IT project managers, software developers, cybersecurity analysts, and AI and machine-learning specialists. It is not only about México — the big question is whether we have the talent, globally, ready to face the needs of a market changing faster every day because of technology challenges.

Sustainable Technology
What will prevail is the use of technology to reduce emissions and transform supply chains, among other KPIs. The combination of the physical and digital worlds will become one of the new trends, creating opportunities to reimagine hybrid meetings and work with less environmental impact. One in three organizations plan to develop internal capabilities in e-commerce and digital commerce platforms, big data analytics, cloud computing, and the Internet of Things. Therefore, this is the type of profile that organizations are targeting.

Looking Ahead

Once we know what companies are looking for and not finding easily, another valuable question becomes: What are we doing to quickly cover those needs? From the very basics, for job seekers, for example, learning to align your profile (developing other skills) with what is most in demand. On behalf of organizations, one of the most important questions is: How will employees fulfill their roles while upskilling to form new profiles?

Schools are an important enabler of early knowledge that expires faster. However, these same centers have the possibility of offering a retraining aligned with the needs of the private initiative.

For a closer look on what’s going on with talent in the United States, check out our Leadership in the Labor Shortage video series, featuring advisory board member John Frehse.