UAE's efforts at long term strategic workforce development will help keep the deficit to a projected 110,000 workers by 2030
The growing global skilled talent deficit could leave the Gulf’s biggest economies losing well over a quarter of a trillion dollars by 2030 if the issue is unaddressed, according to a study by global talent and organisational advisory firm Korn Ferry.
Skilled talent shortages will impede growth and could lead to unrealised annual revenue of $50.6 billion in the UAE and more than $206 billion in the Kingdom of Saudi Arabia, according to the Future of Work report.
The second report in a series by Korn Ferry, the report looks at how to help governments and companies prepare for future workforce demands in a new digital economy. In a study of 20 major global economies, technology is being looked at by world leaders as the biggest driver of future growth, discounting value of human capital. Approximately 67 percent of CEOs believe technology will the their chief value generator in the future.
Arabian Business Podcast: The skilled labour crisis
Korn Ferry is calling that a “trillion-dollar blind spot”: research by the company shows human talent will add $1.215 trillion to the global economy, almost 2.33 times greater than physical capital, including technology. It also shows that for every $1 invested in human capital, $11.39 is added to the GDP.
Globally, unrealised economic opportunity totals more than $8.5 trillion due to a talent gap of more than 85 million skilled workers. Europe, the Middle East and Africa (EMEA) account for approximately $1.9 trillion in unrealised revenue potential annually by 2030 with a talent gap of 14.3 million workers.
Germany stands to face the largest deficit in EMEA of 4.9 million workers at an impact of up to $629.89 billion of annual revenue by 2030, equivalent to 14 percent of its economy. India is the only economy in the study that will maintain a talent surplus in 2025 and 2030.
“This talent crisis has the potential to greatly impact individual company growth as well as ambitious national economic development strategies to diversify and grow local economies,” said Jonathan Holmes, Managing Director, Korn Ferry MENA. “Now is the time for leaders in both the public and private sectors to proactively plan and align the workforce of the future to power the growth needs of the economy of the future.”
While the UAE will still have a talent deficit in 2030, efforts at addressing looming talent gaps with long-term economic and social development platforms see it projected to face the smallest impact in 2030.
The creation of the National Higher Education Strategy and Education and Human Resources Council, which recently launched a new partnership with the UAE private sector to promote advanced skills development for the future, as well as initiatives such as One Million Arab Coders will help restrict the skilled talent deficit to 110,000 workers in 2030.
“The UAE is an example of a country that has a highly proactive workforce development strategy that is closely aligned with the long-term economic diversification and sector development strategy. As a result, the country is in an advantaged position compared to other global economies facing significantly greater talent gaps and much higher unrecognised economic opportunities,” said George Karam, Managing Director, Korn Ferry Hay Group.
The Korn Ferry study, Future of Work: The Impending Talent Crunch, is a series of four reports, with two more to be unveiled over the course of the year. The reports look at future talent supply and demand in 20 major economies at three milestones: 2020, 2025 and 2030, and across three sectors: financial and business services; technology, media and telecommunications (TMT); and manufacturing.