Thinking STEEP: A Bit of Economic Environmental Scanning

If you have read me for any period of time you know I pay attention to “futurism” topics and I try to make you aware of this issues as well. To me a good strategic HR professional is part futurist. So I eat this stuff up. At the Atlanta Business Chronicle’s Growth Expo that I attended the other day (where I heard about Disney’s approach to people Hire Attitude vs Aptitude: A Lesson from Disney) they had three economist discuss the state of the economy and what the future held. The economists, who are well respected in the Southeast, were Rajeev Dhawan of Georgia State University, Jeff Humphreys of the University of Georgia, and Roger Tutterow or Mercer University. Here are my notes on some of what they had to say.

  • They were all in agreement that the jobs picture for the entire country will be very slow to recover and job growth will 1% to 1.5% at most. Gone are the days of 3% job growth.
  • Job growth is driven by investment. And investment is driven by CEO confidence in the economy.
  • It will take until 2014 or 2015 before jobs return to the pre-recession levels. We lost 8.4 million jobs and at 1% it is going to take awhile to get back to even.
  • Job growth driven by government hiring will continue to diminish and for the remainder of 2010 and some of 2011 will drag down growth numbers, but the private sector will be hiring.
  • Companies expect workers to “retool” themselves by acquiring new skills that will make them more attractive to companies.
  • Workers will need technical skills regardless of what industry segement they work in.
  • Job growth will come in these areas:
    • Professional business services
    • Healthcare
    • Some high tech
    • Some education
    • Entertainment and hospitality
    • Export services and companies
  • But, repeating, job growth is driven by investment, investment is driven by CEO confidence and CEO’s are uncertain about what the government is doing. Thus they are not confident. So job growth will be slow.
  • The job market will be competitive through 2015.

So there you have a dose of economic environmental scanning. It means a couple of different things. If you are a job applicant it means you need to increase your skills. What you knew 6 months ago is OUTDATED. Laws change, technology changes, social movements change and more. You MUST stay up to date.

If you are an employer, you must change too. However, it will still continue to be a “buyers” market that allows you to get the cream of the crop. Some people may still be reticent to trade a “sure thing” for a “new thing” so you will have to hone your sales skills to attract the best. One thing you may need to do if you have a new technology is to provide some help in people acquiring that new technology. Hire for attitude and train for aptitude, like Disney. Or work with a school and sponsor them training for that technology.

BTW, for those of you that don’t remember STEEP stands for Socitial, Technological, Economic, Evironment and Political. It is a good way to classify your environment scanning. You can learn more about it here by reading Future, Inc.: How Businesses Can Anticipate and Profit from What’s Next and by reading my post about it here.

2 thoughts on “Thinking STEEP: A Bit of Economic Environmental Scanning”

  1. Interesting post Mike – but it is kind of like a doctor or mechanic telling you something you don't want to hear. The economy is slow and it is going to take a long time to recover. It took a long time to get where it is.

    If we all could look at thing a littlem more matter of fact and take the politics and emotions out of the matter, I think we could focus much better.

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