*Statistics and numbers edited on May 17th*
You might have heard about the Great Resignation in the United States, where there is a massive trend of workers leaving their jobs and the job market causing a big labor shortage. While there isn’t a great resignation in Europe (yet), the labor shortage has hit a new high here too. It’s time to start thinking creatively about possible solutions.
The unemployment rate has decreased in the last year, in the Eurozone it’s at 7%, while the Dutch unemployment rate was as low as 3,8% in the last quarter of 2021. This might seem great, but this results in a new problem: There are more vacancies than there are unemployed workers. In the first quarter of 2022 this ratio was 133 vacancies to 100 unemployed.
We’ve established there’s a labor shortage in Europe and the Netherlands. But where did all the workers go? How did we go from a job shortage to a labor shortage?
One reason is the ageing population. Baby boomers are increasingly retiring. The Dutch and European ratio of the working population and nonworking population is shifting. With less and less people in the workforce, there are an increasing number of empty vacancies.
Another cause of the labor shortage is part-time workers. The Netherlands is already king in part-time work. According to the Dutch Central Bureau of Statistics (CBS) 48.1% of Dutch workers worked part-time in 2021. Causing the working population to work only 32 hours a week, on average. Especially since the younger generations are craving more time away from work to focus on other activities and their loved ones.
The combination of older generations retiring and younger generations increasingly working less hours explains the absence of people able to fill vacancies.
The situation also seems worse than it was before the pandemic. This is because of the economic growth the economy went through after the relaxation of the Corona rules and guidelines. This growth has shown that there is a shortage of workers and worsened the situation.
Technology brings great solutions to the problem of labor shortage in this day and age. Think of hiring Artificial Intelligence (AI) services, like Freeday’s own digital employees, in addition to trying to find human workers elsewhere, for instance via staffing agencies such as Young Capita.
Freeday’s digital workforce has been developed to aid in the fight against the labor shortage. Freeday has cultivated conversational AI, which incorporates tools such as Natural Language Processing (NLP), Automatic Speech Recognition (ASR), and Machine Learning (ML) with software like chatbots, voice assistants, and email sorters. This conversational AI guides customers and employees through an interface in order to complete repetitive tasks, or answer questions.
Jobs consist of a set of tasks. There are many tasks in these jobs that are repetitive and suck all motivation out of employees, while also making them spend a lot of time on said tasks. The issue with the labor shortage is a question of time spent working, if time and energy can be saved, there are less FTEs needed to run the business.
This is where these digital employees come in. They have been created to handle the repetitive tasks that jobs come with to save precious time. Since digital employees don’t get sick, and never go to sleep, they are more reliable and available for the repetitive and necessary daily tasks. On average they are 5x faster than a human team member.
Freeday offers several different digital employees that organizations can hire, ranging from chats, to voice, to email bots. There are HR, customer service, IT, finance, and healthcare employees ready to be onboarded that are scalable and flexible.
Since many people work part-time another solution that is often talked about is to get people to revert back to 40 hour work weeks. But what if people tend to be happy with the amount they are working? The employer, would have to increase employee and job satisfaction for the employees to even start thinking about increasing their hours. But how do you increase their satisfaction and experience?
Once again, technology is a big help. With digital transformation and conversational AI the boring and repetitive tasks can be discarded by the human employees, leaving these tasks for the robots.
The people can then put their focus on the creative, challenging, and fun jobs, preventing them from becoming uninspired and unproductive. 74% of employees find that automation of tasks increases job satisfaction, as humans aren’t being treated as robots anymore. Job satisfaction can increase productivity up to 13%. Becoming more productive further decreases the time and FTEs needed for an organization to run smoothly.
A good example of what a digital customer service workforce can do for the insurance sector is automating filing an insurance claim. Instead of having a human employee needing to spend time and energy on filing similar and easy claims for customers that tend to become repetitive quickly. Filing claims still need to be done, however, so why not automate it?
A digital customer service employee can automatically file simple and easy claims for the customer by asking the right questions to acquire the information needed for the claim. Any claims that the digital employee is unable to file properly or is unable to assist the customer with will be forwarded to a human worker.
Therefore, the complex claims that need more attention and critical thinking will always fall in the good hands of human employees. This makes the job less stressful and labor intensive for other employees, helping solve the labor shortage. The digital employees exist to support the human employees, not to replace them.
Something has to be done to prevent big problems from arising regarding labor shortages. One big, modern, and disruptive solution for the problems managers are facing is using technology and AI in new ways.
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