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OC Leader Board: Creating an Engaged and Resilient Talent Pipeline for Orange County

The future of work is upon us. However, there is growing evidence that many organizations in the U.S. are not prepared to thrive in this new landscape.

A recent Gallup study noted that U.S. workforce engagement has hit an 11-year low. The American Psychological Association found that 84% of employees report that their workplace conditions have negatively impacted their mental health.

Unsurprisingly, the McKinsey Global Institute has found that productivity growth in the U.S. has declined significantly over the last decade. These data suggest a shift in the U.S. labor market that has rendered many traditional approaches to workforce management either ineffective or irrelevant.

So, what has changed, and more importantly, what can leaders do to foster engaged and productive workforces going forward?

To explore these issues, I recently authored โ€œThe Conversation on Work,โ€ where I examined the paradigmatic shifts in how people workโ€”and what these changes mean for the future of organizations.

The book serves as a guide for both executives and employees, offering practical insights into how organizations can succeed in the evolving world of work.

When Employers Donโ€™t Meet Expectations

One key insight from my research is that several structural, and likely permanent, shifts in the labor market have created new challenges and opportunities for organizations.

Over the last 20 years, the impact of the manufacturing and resources (e.g., agriculture and raw materials) sectors on the U.S. economy has dramatically declined, with the service sector now the dominant driver of U.S. gross domestic product (GDP).

This trend is especially pronounced in Orange County. In 2022, 85% of Orange Countyโ€™s GDP came from the service sector, compared to only 15% from the manufacturing and resources sectors.

Much of this economic output has stemmed from the regionโ€™s strength in innovation and technology, driven by large firms such as Edwards Lifesciences and Experian, along with the growing influence of the venture community.

Most service sector jobs (e.g., accounting, finance, information technology) require generalizable occupational skills, such as computing and communications competencies, which are often easily transferable across companies.

This mobility allows employees to switch jobs while maintaining productivity, making them more selective in their job choices.

As a result, if an employer fails to meet their expectations, employees are increasingly likely to seek out positions at organizations that do. Thus, itโ€™s no surprise that the U.S. has seen a steady rise in voluntary employee turnover over the past 15 years. In many ways, the shift to a service-based economy has altered the dynamics between employers and employees, giving employees far more leverage than in the past.

Another critical trend is the increasing diversity of the workforce. Orange County has been a majority-minority county for years, and its ethnic diversity continues to grow.

However, the most significant demographic shift in the county over the last decade has been related to age. Between 2010 and 2020, the population of individuals over the age of 65 in Orange County grew by 47%, making it the fastest-growing segment of the population.

Many of these individuals are active in the workforce and represent a vital talent pool for local organizations, especially given the 9.3% decline in the number of people aged 5โ€“19 during the same period.

Employers in Orange County must now manage a workforce spanning four generations.

Importance of Flexible Work

These structural changes in the labor market are placing new demands on employers. To recruit and retain talent, organizations must better accommodate employee preferences.

Yet, with an increasingly diverse workforce, they also face a wider range of preferences to manage. For instance, the work expectations of a 21-year-old employee are likely to differ significantly from those of a 70-year-old employee, but both are essential to organizational success.

At the University of California, Irvineโ€™s Paul Merage School of Business, our global experts are at the forefront of exploring how organizational leaders can best respond to these crucial shifts.

We are leading the conversation on the future of work, hosting initiatives to share insights from cutting-edge research with real-world applications for Orange Countyโ€™s leaders.

One key finding centers on the role of flexible work environments in enhancing employee engagement and performance. Data shows that hybrid and remote work models can be highly effective for organizations because they accommodate various employee preferences.

These models also widen the talent pool from which organizations can recruit and help reduce physical infrastructure costs. For instance, Experian has successfully implemented this approach in managing its workforce.

However, while flexible work environments offer clear benefits, they can also introduce new challenges related to employee socialization, team collaboration and company culture.

Leaders must develop new skills and strategies for communication and organizing work to navigate these challenges.

The Search for Future Leaders

Another important insight is the need for organizations to adopt long-term strategies for developing their talent pipelines.

The shifting demographics, particularly the declining number of younger workers, mean that firms must invest in innovative solutions to create new talent pools.

For the past three years, the Paul Merage School of Business has partnered with Orange County school districts, philanthropists and leading businesses such as Samsung, Taco Bell, Hyundai and PIMCO to run the Future Leaders Initiative.

This summer program supports high school and community college students in pursuing business careers in the technology sectors. Programs like these ensure that Orange County businesses will have access to the talent needed to meet their future workforce demands.

As we look to the future, it is clear that the landscape of work is changing at an unprecedented pace. Yet, with change comes opportunity. Orange Countyโ€™s businesses, educational institutions and government are well-positioned not only to adapt but to lead in shaping the future of work in Southern California and beyond.

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Sonia Chung
Sonia Chung
Sonia Chung joined the Orange County Business Journal in 2021 as their Marketing Creative Director. In her role she creates all visual content as it relates to the marketing needs for the sales and events teams. Her responsibilities include the creation of marketing materials for six annual corporate events, weekly print advertisements, sales flyers in correspondence to the editorial calendar, social media graphics, PowerPoint presentation decks, e-blasts, and maintains the online presence for Orange County Business Journalโ€™s corporate events.
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