Profound market shifts are transforming the global demand for and supply of talent, while the sources from which talent is recruited are also realigning, according to a report by Oxford Economics in partnership with professional services company Towers Watson.  

Based on the views of 352 HR professionals around the world, the report identifies four diverse global forces that are likely to drive talent requirements in the years ahead: advances in technology globalisation, shifts in labour demographics, customer needs and competition.

As a result of these shifts, the study argues that organisations need to rethink their global, business strategies and organisational approaches, including their recruitment and talent strategies.

The study identifies four areas where skills will be in greatest demand over the next five to 10 years. These include digital skills, agile thinking, interpersonal and communication skills, and global operating skills.

And as the economic rise of Asia continues, firms must also prepare for long-term and structural shifts in demand for labour as “a new geography of talent will come to define workplace recruitment”, says the report.  

Demand for talent is Asia is projected to grow by 22% over the next five to 10 years, but by only 3.5% in Western Europe.  

The report predicts that growing nations such as China and India will respond by improving access to education, thereby growing their talent pools. However, while the growth of China is projected to absorb this flow of well-educated talent into its workforce, India is predicted to have a surplus of college-educated talent.  

The picture is a mixed one, however, says the report, with Taiwan, Japan and Poland predicted to have the widest talent deficits, with India, Indonesia and Colombia having the greatest talent surpluses. 

As the report says: “The talent mismatch – between where talent is most needed and where it will be most available – is not likely to evaporate soon. Managing this skills gap in the developed world and recruiting appropriate talent in the emerging economies will become a critical task for global firms in the future.”