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  • TEN YouthUnlocking Enterprise Growth by Focusing on the Fortune at the Bottom of the Talent Pyramid
  • Nicholas Davis (bio), Ebba Hansmeyer (bio), Branka Minic (bio), Shantanu Prakash (bio), and Subramanian Rangan (bio)

In 2013, the business environment in many developed economies remains sluggish. Macro fiscal and monetary support notwithstanding, business enterprises in these economies are still awaiting a robust and confident recovery in demand. Understandably, enterprises in such circumstances have focused on lowering costs and ensuring near-term profitability while placing growth and investment on the back burner. As a result, unemployment in general, and youth unemployment in particular, remains high.

In emerging economies, on the other hand, enterprises face a different growth challenge. In Brazil, China, Indonesia, India, Nigeria, and Turkey as elsewhere, enterprise growth and expansion is bottlenecked not so much by demand but by supply—specifically, the supply of workers with mid-level skills.1 In such economies one hears of a talent drought.

Consider the case of the Dutch multinational, Philips, which some years ago secured a substantial business deal from the Zambian government. Philips was asked to provide medical equipment and technical expertise as part of a government program to improve hospital infrastructure and to make more advanced diagnostic services available to patients.

As the project matured and implementation proceeded, a major challenge emerged: there were not enough skilled radiologists, nurses, and other technical [End Page 141] personnel in the local workforce to actually operate the new equipment from Philips.

Philips and its partners eventually trained more than 300 radiographers and radiologists. But as J. J. van Dongen, senior vice president for Philips Africa, observed, “If we don’t have trained people to operate our machinery, then we’re not doing the right job for our clients.” While commenting on the huge market potential of the African continent, which includes six of the world’s ten fastest-growing economies, he cautioned: “If you want to be involved in the African economy, you have to … contribute to the development of skills in Africa.”2

The skills shortage experienced by Philips in Zambia is endemic across many emerging economies. Growth in the mining industries in Brazil3 and Mongolia4 has led to shortages, not only of engineers and technicians but of drivers and laborers as well. Likewise, the maquila industry along Mexico’s northern border is reported to miss out on growth opportunities because it is difficult for enterprises to find experienced, bilingual sales people.5 The outsourcing boom in India has slowed in recent years, in part because of concerns about the quality of graduates from the nation’s technical and university system.6 To be sure, the shortage of talent is present even in developed economies’ growth sectors (such as the U.S. and

Australian energy sector) and where an aging demographic means that skilled workers are retiring faster than they can be replaced.

Meanwhile, millions of youth around the world confront unemployment.7 Youth have several factors that work against them in the search for employment. They are at the bottom of the talent pyramid because, understandably, most of them lack work experience. A substantial proportion do not have a college degree. Even among those with a college degree only a few have work-ready skills. Last but not least, the labor market—a mystery even to specialists and veterans—is a maze to youth. As numerous observers have lamented: youth unemployment is a grave and present danger, especially because it is known to have enduring, negative effects in terms of future employability, lifetime earnings, and health, not to mention dignity, life satisfaction, and stability in society.

In our view, which we present in this article, the dual problems of an enterprise talent shortage and youth unemployment may be addressed in a bold and fundamentally unified manner. After all, enterprises seeking to realize business growth must have an appropriately skilled and productive workforce. Moreover communities and nations seeking to improve the lives of their youth must attract fast-growing companies that bring more and better jobs. We first review traditional approaches to this vexing challenge, and then we propose a hybrid approach that we call TEN Youth. As we hope to show...


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pp. 141-157
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