A majority of executives of multinational corporations cite a growing global shortage of talent as a factor that could limit their entry into both developed and emerging markets more so than economic weakness or even political instability, according to a report presented today by AXA Group and MetLife, Inc.’s MAXIS Global Benefits Network (GBN)*.
Forty percent of the multinationals surveyed say they intend to expand their operations in both developed and emerging markets, including but not limited to the so-called BRIC emerging markets encompassing Brazil, Russia, India and China. The findings of the study, sponsored by MAXIS GBN, are based on an Economist Intelligence Unit (EIU) survey of more than 350 executives from multinational companies. The macroeconomic-focused research covers findings gathered from various industry sectors and locations, both in mature and developing countries. The report seeks to outline the international development strategies multinationals are employing to achieve successful growth at a global scale. The research also looks at the challenges to their growth.
“Far and away the biggest challenge for multinational corporations is finding the talent in local markets to expand their business,” said Maria Morris, executive vice president, Global Employee Benefits, MetLife and MAXIS executive board member. “The war for talent is alive and being fought on a global scale,” added Morris.
War for Talent
As multinationals are expanding globally, so will their workforce. Of the largest multinationals surveyed (those with more than US$10B in annual revenue), close to one-fifth expect to have more than 85% of their total workforce outside their home country in the next five years. This figure represents nearly double the current figure.
In addition, the difficulty of simply attracting and retaining talent in non-home markets is clear in the survey findings. Nearly two-thirds (66%) of respondents say talent shortages are likely to affect their bottom line in the next five years. The focus on talent shortages and hiring challenges is highest amongst technology, professional services, healthcare, pharmaceuticals and biotechnology.
Both HR and business executives agree that employee benefits are critical in efforts to move talent among geographies in which they operate. Ninety percent say employee benefits are a key lever in the battle for local talent. In addition, benefits rank second only to salary in importance for their globalization strategies.
HR and Business Leaders: Wide Apart
Given that the global talent shortage is the number one issue for multinationals, the survey finds that there is still work to be done to align the gap in perceptions among HR and their business counterparts about assessing local talent in markets and the company’s readiness for expansion.
HR representatives are far more likely than business executives to say their firms are proactive in assessing the talent portion of market entry/expansion. Among business executives (excluding the HR function), 61% say their firms evaluate talent management issues (eg, acquisition and retention of functional capabilities or other expertise) only after they have identified markets for entry/expansion or don't see talent as an important globalization issue at all. By contrast, 63% of HR executives say talent is considered when markets are being identified.
“Clearly, the new expansion aims of multinational companies require the development and retention of their talent. This is a key objective for human resources executives. MAXIS GBN is committed to helping them create an environment of employee benefits and protection that will be conducive to achieving their goals,” said Didier Weckner, CEO AXA Group Life Business, Chairman of MAXIS GBN.
The MAXIS study also found the following trends:
About the Survey
A total of 366 senior executives from around the world were surveyed in March 2012. More than one-half are C-Level executives (54%). Responses came from a wide range of regions: 33% are headquartered in North America, 22% in Asia-Pacific, 34% in Western Europe, 10% in Latin America and 3% in the rest of the world.
The range of company sizes was also diverse, from those with revenues of less than US$500m (46%) to those with revenues of US$10bn or more (22%). The survey covers nearly all industries, including professional services (14%), healthcare, pharmaceuticals and biotechnology (12%), manufacturing (12%), financial services (11%), and IT and technology (9%).
Of the respondent group, 27% are from general management, 23% from strategy and business development, 15% from finance and 9% from human resources.
About MAXIS Global Benefits Network:
MAXIS Global Benefits Network, created by insurance leaders AXA Group and MetLife Inc., is the largest International Employee Benefits network with leading positions in core markets around the globe. MAXIS GBN offers innovative employee benefits solutions and services to large multinational corporations in more than 100 countries. For more information, visit www.maxisnetwork.com.
About the AXA Group
The AXA Group is a worldwide leader in insurance and asset management, with 163,000 employees serving 101 million clients in 57 countries. In 2011, IFRS revenues amounted to Euro 86.1 billion and IFRS underlying earnings to Euro 3.9 billion. AXA had Euro 1,065 billion in assets under management as of December 31, 2011.
The AXA ordinary share is listed on compartment A of Euronext Paris under the ticker symbol CS (ISN FR 0000120628 – Bloomberg: CS FP – Reuters: AXAF.PA). AXA’s American Depository Share is also quoted on the OTC QX platform under the ticker symbol AXAHY.
The AXA Group is included in the main international SRI indexes, such as Dow Jones Sustainability Index (DJSI) and FTSE4GOOD. For more information, visit www.axa.com.
MetLife, Inc. is a leading global provider of insurance, annuities and employee benefit programs, serving 90 million customers. Through its subsidiaries and affiliates, MetLife holds leading market positions in the United States, Japan, Latin America, Asia, Europe and the Middle East. For more information, visit www.metlife.com.
*MAXIS Global Benefits Network is an international employee benefits network formed by AXA Group and MetLife, Inc., and consisting of insurance companies affiliated with AXA and MetLife, and independent insurers.