I had to LOL today when I read Spend Matters’ interview with ISM’s chief content and engagement officer, M.L. Peck. One excerpt of the interview stood out to me because it ventured into the topic of the “supply chain talent crunch.”
In this excerpt, Spend Matters’ wrote “We always hear about the mass exodus of supply chain professionals that’s going to come when the Baby Boomer generation retires. But at the same time, more universities are establishing supply chain programs, which are also becoming more popular. What is your take on the talent gap? Is it as bad as people say?”
Peck responded by saying, “I do think the talent gap is substantial. We’re now at the point where within the next five years or so, 75% of baby boomers are going to retire and Generation X wasn’t big enough to fill all of those seats.”
This sounded eerily familiar to me.
So, I went back to the NLPA blog and found a post entitled “The Purchasing Talent Crunch Paradox” from July 27, 2007. That’s not a typo in the year. It is actually from 2007, not 2017.
In the comments to that post, fellow blogger Michael Lamoureux and I had an interesting exchange. Lamoureux wrote “When you consider the fact that 76M baby boomers in the US will soon be eligible for retirement – over 25% of the US population and over 35% of the US workforce – the talent crunch is only going to get worse. Much worse! And it’s going to happen on a global basis as well, since 25% of the world’s population will reach retirement age in the next 3 years!”
I responded by writing “I think that one distinction that deserves to be made is the difference between ‘eligible for retirement’ and ‘planning to retire.’ While many baby boomer purchasing folks are eligible to retire, many will continue to work. I still think that the talent crunch is not destined to get worse. It can get worse. But it doesn’t have to. There are so many tactical purchasers out there who can step up and really make a career for themselves. There are more university purchasing programs than there were when the baby boomers started their careers. The image of purchasing has been elevated in recent years. All of these things can prevent the ‘sky from falling.’ The wild card is for the tactical purchasers to see both the threat to their ‘as-is jobs’ as well as the opportunity to have a tremendously successful career by transforming their capabilities to qualify for the strategic ones.”
So, if Spend Matters and ISM are talking about the “supply chain talent crunch” and Baby Boomer retirement ten-plus years after visionaries like Michael Lamoureux and I debated it, it shows that the sky wasn’t falling after all, then.
And it’s not falling now. You may worry based on pieces like my blog post from last week, but the economy has always been cyclical. Once it reaches a boiling point, the pendulum swings and things go in the opposite direction.
Consider these things. In this month’s article of mine entitled “Procurement Challenges In A Hot Economy,” I cited some statistics: a US unemployment rate of 4.2% that was the lowest since February 2001 and a historically high Dow Jones Industrial Average of 23,000.
Well, what happened immediately after February 2001?
The unemployment rate rose the next month. And the month after that. In a year, it was at 5.7%. In 27 months, it rose to 6.3% before declining again. It went as low as 4.4% in May 2007 – around the same time as the blog post I’ve cited above. Then, it rose to a whopping 10% in October 2009 before a SLOOOOOW recovery brought it to where it is today, eight years later.
Did the stock market follow suit?
You bet it did!
In February 2001, the Dow stood at 10,495.28. In a year, it fell to 10,106.13. By the time the unemployment rate peaked at 6.3%, it declined to a pathetic 8850.26. Like the unemployment rate, it improved over the next few years, blowing past the 13,000 mark around the time of the aforementioned blog post. Then, it slumped to around 7,000 when unemployment reached its zenith.
So, is an economic correction imminent?
I wouldn’t bet against it.
And that supply chain talent crunch?
It may worry latecomers like ISM and its exec.
I wasn’t worried about the supply chain talent crunch in 2007 and time has proven me right.
And I’m not worried now.