Karl Marx once referred to a pool of unemployed workers as capitalisms ‘industrial reserve army’ and essential to the workings of the wages system.

Wages would decrease as the size of the ‘reserve army’ increased and in times of high employment the bourgeoisie would be looking for ways to decrease costs either by labour-saving mechanisms, laying off employees or cutting back on operations.

Last week I phoned into the HR Happy Hour which is hosted by the very talented Steve Boese (@SteveBoese) and made the comment that ‘It’s not a ‘War on Talent’ but a ‘War on Cost’. This was in direct response to a ‘War on [Insert Target Here]’, in this case ‘Talent’ bomb dropped earlier on in the show but regularly raised by many people and groups.

Some other recent exponents of the ‘War on [Talent]’ include:

Rana Hobbs, Principal Consultant for SuccessFactors will be conducting a HR.com Webinar this week titled ‘Is there a "New War for Talent"? Workforce Planning in 2011’;

Lois Melbourne (CEO, Aquire) raised the issue during my Focus.com interview in early May;

At the height of the boom (May 2008), SAP sponsored the Economist to write ‘Talent Wars, The struggle for tomorrow’s workforce’ which makes for interesting reading and had the following statement in the executive summary:

“Over half of surveyed firms will look beyond their home regions to fill talent gaps. U.S and Japanese firms will increasingly look to east and south Asia (China and India, for example) for new talent, while UK, German and French firms will look strongly to eastern Europe for recruits.”

You can find the ‘War on [Talent]’ terminology everywhere from the big guys to the street level. The language actually comes from the late 1990’s (coined by a consulting firm) and then in 2001 grew into a book by Ed Michaels, Helen Handfield-Jones, Beth Axelrod.

I hear it, ad nauseum ALL THE TIME.

But are the constant references, especially in the United States really about a ‘War on [Talent]’ or is it really a War on [Talent Cost]?

The point I raised on HR Happy Hour was that the U.S.A has an ‘official’ unemployment rate currently standing at 9% (April, 2011: http://www.dol.gov/) so the constant references to a lack of talent in the US is a strange dialogue if you compare it to Australia with an 'official' unemployment rate of 4.9% (April, 2011: http://www.abs.gov.au).

In the Australian state of Queensland, when the ‘official’ rate of unemployment cements its percentile under 4%, you don’t have unemployment. You just have people who don’t want to be employed or people who cannot get employed.

Given the tightening market when I hear the argument about the ‘War on [Talent]’ in x sector in Australia, then I might lend it some credence, given that in some sectors there just isn’t the bench ready workers to get some projects up & running. At the moment the discussions are at the high & low end of the employment supply chain. High end includes mining, energy and infrastructure projects (all bricks and mortar skillsets) and at the low end in areas like community services, nursing and hospitality.

Thus when the same subject is raised in the US, which conservatively has 11-million officially unemployed workers I get a little suspicious that both employers and employees are gaming the numbers. 

11-million workers is an enormous amount of capacity.  How much of this 'industrial reserve army' could be 'bench-ready' in a matter of months or even in a year if a little effort was applied?

The War on [Talent] description for the U.S is just lazy language. Come to Australia and see how a real 'War on [Talent]' is playing out.

What I actually think is happening in the U.S is that the discussion around the ‘War on [Talent] has just become a discussion by business to lock in the wage savings found during a time of want by employee’s, especially as the market sees a slow improvement. At the same time the issue is being beat up by a significant amount of newly minted consultants who were displaced (ironically by the GFC) and the technology companies who have ERP, HR and HCM products to sell.

There seems to be a dichotomy between what U.S business is willing to pay for ‘Talent’ and what ‘Talent’ wishes to be paid in the post GFC world.

I suspect that as that ‘official’ unemployment number reduces in the U.S (barring unforeseen catastrophes) and reaches its longer term average of approx. 5.7% you will then hear even more influencers talking about the ‘War on [Talent] and commentators, like myself, believing in the discussion again.



Two minor points here the 9% figure does not count underutilised employee’s & those not counted in the official BLS statistics and the best guess 11-million figure of officially unemployed Americans is the size of the entire Australian workforce.

If you wish to listen to the full HR Happy Hour show and the call-in discussion kicked off with the very talented Dawn Hrdlica-Burke (@dawnHRRocks) who dropped the ‘War on [Talent]’ bomb go to http://bit.ly/ilnjyZ

Shane Granger is an Operational workforce planner, analyst, social scientist, pseudo-intellectual, occasional blogger, hiker, fine-wine lover & cricket nut. He can be lauded or abused on Twitter @gmggranger